From tools to theories: The emergence of modern financial economics
It is shown that early research in modern financial economics had substantially been driven by the application of the research strategy of economics and the use of newly developed mathematical methods. For this purpose the professionalization of business education as a consequence of changes in the U.S. economy after Word War II is presented. The emergence of professional Journals in financial economics, similar to the academic culture including the trend of applying abstract mathematical reasoning and during the war developed methods like linear programming are highlighted. Also the meaning of Milton Friedman's 1953 essay The Methodology of Positive Economics for the dominance of abstract and prediction driven research in modern financial economics gets discussed. Finally, the emergence of Harry Markowitz's paper Portfolio Selection (1952) is used to substantiate the hypothesis.
|Date of creation:||2011|
|Contact details of provider:|| Postal: Alfred-Herrhausen-Straße 50, 58448 Witten|
Phone: +49 (0)2302/926-584
Fax: +49 (0)2302-926-585
Web page: http://www.uni-wh.de/wirtschaft/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Samuels, Warren J., 2002. "Machine Dreams: Economics Becomes a Cyborg Science. By Philip Mirowski. New York: Cambridge University Press, 2002. Pp. xiv, 655. $35.00, paper," The Journal of Economic History, Cambridge University Press, vol. 62(03), pages 913-915, September.
- Donald MacKenzie, 2006. "An Engine, Not a Camera: How Financial Models Shape Markets," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262134608, March.
- Hausman,Daniel M. & McPherson,Michael S., 2006. "Economic Analysis, Moral Philosophy and Public Policy," Cambridge Books, Cambridge University Press, number 9780521608664, December.
- L. V. Kantorovich, 1960. "Mathematical Methods of Organizing and Planning Production," Management Science, INFORMS, vol. 6(4), pages 366-422, July.
- Blaug, Mark, 2003. "The Formalist Revolution of the 1950s," Journal of the History of Economic Thought, Cambridge University Press, vol. 25(02), pages 145-156, June.
- Mirowski,Philip, 2002. "Machine Dreams," Cambridge Books, Cambridge University Press, number 9780521772839, December.
- Debreu, Gerard, 1991. "The Mathematization of Economic Theory," American Economic Review, American Economic Association, vol. 81(1), pages 1-7, March.
- Milton Friedman & L. J. Savage, 1948. "The Utility Analysis of Choices Involving Risk," Journal of Political Economy, University of Chicago Press, vol. 56, pages 279-279.
- Blaug,Mark, 1997. "Economic Theory in Retrospect," Cambridge Books, Cambridge University Press, number 9780521577014, December.
- J. Fred Weston, 1967. "The State Of The Finance Field," Journal of Finance, American Finance Association, vol. 22(4), pages 539-540, December.
- Whitley, Richard, 1986. "The transformation of business finance into financial economics: The roles of academic expansion and changes in U.S. capital markets," Accounting, Organizations and Society, Elsevier, vol. 11(2), pages 171-192, March.
- Mirowski,Philip, 2002. "Machine Dreams," Cambridge Books, Cambridge University Press, number 9780521775267, December.
- Hausman,Daniel M. & McPherson,Michael S., 2006. "Economic Analysis, Moral Philosophy and Public Policy," Cambridge Books, Cambridge University Press, number 9780521846295, December.
When requesting a correction, please mention this item's handle: RePEc:zbw:uwhdps:162011. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.