Edwin Kuh (1925-86) was hired by the Sloan School at M.I.T. in 1954, completing his Harvard Ph.D. in 1955. He was promoted to full professor of economics and finance in 1962 and was a joint appointment of the Sloan School and the department of economics. Mostly known as a pioneer in the application of econometric methods to forecasting, his New York Times obituary notes that in 1971 he worked together with Lester Thurow and John Kenneth Galbraith to devise proposals to promote affirmative action.
The undergraduate course reading list for finance transcribed for this post was fished out of Franco Modigliani’s papers at the Economists’ Papers Archive at Duke University.
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15.46 FINANCE
E. Kuh
Fall Semester, 1962
I. CAPITAL MARKETS (2 weeks)
W.L. Smith, “Monetary Policy and Debt Management”, Chapter 9, Staff Report on Employment, Growth and Price Levels, Joint Economic Committee, 1959, pp. 315-407.
R. L. Rierson, The Investment Outlook, Bankers Trust Co., 1962.
II. CAPITAL BUDGETING (8 weeks)
A. Decision Criteria—New Asset Demand
P. Massé, Optimal Investment Decisions, Ch. 1.
V. L. Smith, Investment and Production, Ch. 1, Ch. 3, pp. 62-72, Ch. 9.
E. Solomon, editor, The Management of Corporate Capital, Essays II—3, 5, 6, 7, 8.
D. Bowdenhorn, “Problems in the Theory of Capital Budgeting”, Journal of Finance, December 1959, pp. 473-92.
B. Decision Criteria—Replacement Demand
V. L. Smith, Investment and Production, Ch. 5.
P. Massé, Optimal Investment Decisions, Ch. 2.
C. Cost of Capital—Risk and Uncertainty
H. Markowitz, Portfolio Selection, 1959, pp. 1-34, 180-201, 287-97.
J. Hirschleifer, “Risk, the Discount Rate and investment Decisions”, Proceedings of the American Economic Association, May, 1961, pp. 112-120.
F. Modigliani and M. H. Miller, The Cost of Capital, Corporation Finance and the Theory of Investment, American Economic Review, June, 1958, pp. 473-492.
L. Fisher, “Determinants of Risk Premiums on Corporation Bonds”, Journal of Political Economy, June, 1959, pp. 217-37.
E. Kuh, “Capital Theory and Capital Budgeting”, Metroeconomics, (August-December, 1960), pp. 64-80.
D. Cost of Capital—Rationing
V. L. Smith, Investment and Production, Ch. 7.
E. Kuh, Capital Stock Growth, excerpts from Ch. 2 (mimeo).
E. Solomon, ed., The Management of Corporate Capital, Essay II-4.
III. DIVIDEND POLICY (2 weeks)
J. Lintner, “Distribution of Incomes of Corporations Among Dividends, Retaining Earnings, and Taxes,” American Economic Review, Supplement, May, 1956.
S. Dobrovolsky, Corporate Income Retention, 1915-1943.
IV. CURRENT POSITION (1 week)
D. Greenlaw, “Liquidity Variations Among Selected Manufacturing Companies,” M.I.T. Masters Thesis, 1957.
C. H. Silberman, “The Big Corporation Lenders,” in Readings in Finance from Fortune, Holt, 1958.
V. DEPRECIATION (2 weeks)
R. Eisner, “Depreciation Allowances, Replacement Requirements and Growth,” American Economic Review, December, 1952.
E. C. Brown, “The New Depreciation Policy Under the Income Tax: An Economic Appraisal,” National Tax Journal, March, 1955.
Article on Depreciation Practices in Europe, National City Bank Newsletter, September, 1960.
E. C. Brown, “Tax Incentives for Investment”, Proceedings, American Economic Review, May, 1962, pp. 335-45.
William H. White, “Illusions in the Marginal Investment Subsidy”, National Tax Journal, March 1962.
E. C. Brown, “Comments on Tax Credits as Investment Incentives”, National Tax Journal, June 1962, pp. 198-204.
Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library, Economists’ Papers Archive. Franco Modigliani Papers, Box T1, Folder: “Capital Markets, 15.432. Spring 1963”.
Image Source: MIT Museum website. People: Kuh, Edwin.