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Modigliani, Franco

Economist A professor at the Massachusetts Institute of Technology, Modigliani was born in Italy but is an American economist in both education and culture. Widely regarded as one of the leading macroeconomists of our era, he received the Nobel Prize for Economics in 1985. Originally a Keynesian, in the 1960s-1970s he pursued a theoretical synthesis of the Keynesian and the neoclassical tradition and constantly focused on the relation between monetary phenomena and economic activity. Progressively drawn to monetarist theory, he made seminal contributions to areas ranging from monetary policy to the inflation-unemployment trade-off. Amongst specialists, he is best known for his socalled ‘life cycle’ theory of saving and consumption and his study of the firm’s choice in financing investments (the so-called ModiglianiMiller theorem). He has also often contributed to debate on economic policy in Italy, supporting the incomes policy and repeatedly warning of the dangers of inflation and high national debt.