Financial markets are markets in stories: Some possible advantages of using interviews to supplement existing economic data sources
AbstractFifty-two research interviews were conducted with money managers controlling over $500 billion. This paper presents detailed material from one interview to argue interviews usefully describe their shared reality and provide information about the conditions of action facing financial decision-makers with implications for aggregate behaviour. Their shared reality was dominated by “radical” uncertainty and information ambiguity which severely limited the scope for “fully rational” decision-making. How they managed to commit to decisions was by creating narratives. The study suggests it may be useful to reconsider prejudices against the usefulness of talking to individual economic agents about what they actually do.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Dynamics and Control.
Volume (Year): 36 (2012)
Issue (Month): 8 ()
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Web page: http://www.elsevier.com/locate/jedc
Financial markets; Interviews; Economic methodology; Narrative; Uncertainty;
Find related papers by JEL classification:
- B4 - Schools of Economic Thought and Methodology - - Economic Methodology
- G1 - Financial Economics - - General Financial Markets
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- Tuckett, David, 2009. "Addressing the psychology of financial markets," Economics Discussion Papers 2009-37, Kiel Institute for the World Economy.
- Gordon J. Alexander & Gjergji Cici & Scott Gibson, 2007. "Does Motivation Matter When Assessing Trade Performance? An Analysis of Mutual Funds," Review of Financial Studies, Society for Financial Studies, vol. 20(1), pages 125-150, January.
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[Plight of the Fortune Tellers: Why We Need to Manage Financial Risk Differently]," Introductory Chapters, Princeton University Press.
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- Tuckett, David, 2009. "Addressing the psychology of financial markets," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 3(40), pages 1-22.
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