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The financial Logos : The framing of financial decision-making by mathematical modelling

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  • Christian Walter

    (LAP - Laboratoire d’anthropologie politique – Approches interdisciplinaires et critiques des mondes contemporains, UMR 8177 - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper introduces the notion of "financial Logos", defined as a structuring discourse embedded in management tools and beliefs of financial practices. I hypothesize that this discourse contains a specific representation of risk mathematically modelled by probability measures. Next I use a performativity based approach to describe the concrete action of the financial Logos on financial practices: the framing of financial decision-making by mathematical modelling. I argue that it is not possible to think of a given financial practice without epistemologically and sociologically thinking of the contribution of the mathematical modelling to this practice. I conclude with consequences for ethics of finance: extending ethics of action to epistemic ethics, I suggest that, in finance, any preference in mathematical modelling is also a preference in ethics.

Suggested Citation

  • Christian Walter, 2016. "The financial Logos : The framing of financial decision-making by mathematical modelling," Post-Print halshs-04503518, HAL.
    • Handle: RePEc:hal:journl:halshs-04503518
    DOI: 10.1016/j.ribaf.2016.01.022
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-04503518
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    References listed on IDEAS

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    11. Boudewijn Bruin, 2013. "Epistemic Virtues in Business," Journal of Business Ethics, Springer, vol. 113(4), pages 583-595, April.
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    Cited by:

    1. Christian Walter, 2020. "Sustainable Financial Risk Modelling Fitting the SDGs: Some Reflections," Sustainability, MDPI, vol. 12(18), pages 1-28, September.
    2. Lagoarde-Segot, Thomas & Martínez, Enrique A., 2021. "Ecological finance theory: New foundations," International Review of Financial Analysis, Elsevier, vol. 75(C).
    3. Lagoarde-Segot, Thomas, 2019. "Sustainable finance. A critical realist perspective," Research in International Business and Finance, Elsevier, vol. 47(C), pages 1-9.
    4. Amalia Rodrigo-González & Alfredo Grau-Grau & Inmaculada Bel-Oms, 2021. "Circular Economy and Value Creation: Sustainable Finance with a Real Options Approach," Sustainability, MDPI, vol. 13(14), pages 1-30, July.
    5. Mudakkar, Syeda Rabab & Uppal, Jamshed Y., 2018. "Stability of cross-market bivariate return distributions during financial turbulence," Research in International Business and Finance, Elsevier, vol. 45(C), pages 389-401.
    6. Erwan Lamy, 2023. "Epistemic Responsibility in Business: An Integrative Framework for an Epistemic Ethics," Journal of Business Ethics, Springer, vol. 183(1), pages 1-14, February.

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    More about this item

    Keywords

    performativity; mathematisation; mathematical modelling; financialisation; ethics; Finance;
    All these keywords.

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics
    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics
    • G1 - Financial Economics - - General Financial Markets

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