Well, Black-Scholes has proved pretty useful. With the caveat that all models are wrong-- and most people using B-S know this. Which is why actual option price

Well, Black-Scholes has proved pretty useful. With the caveat that all models are wrong-- and most people using B-S know this. Which is why actual option prices have the "smile", with tail prices being higher than the model would predict (because traders know that the model underestimates tail risk, and generally have a good sense of how far it underestimates it, because the model is fairly transparent). Because B-S is closed form, you can run it backwards, to convert actual prices to an implied volatility. Which is also known to be wrong, because historical standard deviations of returns are only somewhat predictive of future observed returns. As one person put it, Black-Scholes is the wrong model, into which you put the wrong data, to get the right answer.