The Platonic Foundations of Finance and the Interpretation of Finance Models
Titel:
The Platonic Foundations of Finance and the Interpretation of Finance Models
Auteur:
McGoun, Elton G. Zielonka, Piotr
Verschenen in:
Journal of behavioral finance
Paginering:
Jaargang 7 (2006) nr. 1 pagina's 43-57
Jaar:
2006-03-01
Inhoud:
What is the nature of the collection of mathematical models we call "finance?" There is knowledge in finance, but what is the nature of it, and what is it really about? What sorts of justified true beliefs do we have, i.e., what would it mean for these beliefs/models to be true, and how do we justify their truth? The traditional positive interpretation of finance models poses a number of difficult, and perhaps even intractable, philosophical problems. There are as many as six other interpretations, only one of which, the normative interpretation, is familiar. Most of finance's interpretations of its models, including both of the usual ones, fall within the platonic/foundational perspective as it is applied to mathematics. Even the positive interpretation, to which most in finance implicitly or explicitly subscribe, does not reveal the "objective reality" that is supposed to be out there. We clearly need a truly "behavioral" finance, in every sense of the word.
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