Hayne Leland, professor emeritus of finance at the University of California, Berkeley, was awarded the $100,000 Stephen A. Ross Prize in Financial Economics for his work on corporate debt pricing and capital structure, according to a statement from the Foundation for the Advancement of Research in Financial Economics.
Mr. Leland — the Arno Rayner Professor Emeritus of Finance and Management at Haas School of Business at the University of California, Berkeley — is the first recipient of the prize from the foundation, which is a network of finance academicians and practitioners from around the world.
The prize was established in October 2007 and named after Stephen A. Ross, professor of financial economics at the Massachusetts Institute of Technology Sloan School of Management. It is awarded in recognition of advancements in the financial economics over the last 15 years.
A group of Mr. Ross’ former students — mostly academicians and a few investment practitioners — donated the money for the prize, which the foundation plans to award every two years.
The award was given for Mr. Leland’s 1994 Journal of Finance paper “Corporate Debt Value, Bond Covenants, and Optimal Capital Structure.” The paper analyzed how firms determine the optimal mix of debt and equity to acquire funding at the lowest cost.
Mr. Leland said in the statement: “I was surprised and delighted to be the first recipient of the Ross prize.”