On Sun, Jul 29, 2012 at 7:05 AM, Charles Turner <vze26m98 at gmail.com> wrote:
> Thought someone here might be interested in this download:
>
> <http://monoskop.org/log/?p=5042>
>
> The blurb:
>
> "In An Engine, Not a Camera, Donald MacKenzie argues that the
> emergence of modern economic theories of finance affected financial
> markets in fundamental ways. These new, Nobel Prize-winning theories,
> based on elegant mathematical models of markets, were not simply
> external analyses but intrinsic parts of economic processes.
>
> "Paraphrasing Milton Friedman, MacKenzie says that economic models are
> an engine of inquiry rather than a camera to reproduce empirical
> facts. More than that, the emergence of an authoritative theory of
> financial markets altered those markets fundamentally. For example, in
> 1970, there was almost no trading in financial derivatives such as
> “futures.” By June of 2004, derivatives contracts totaling $273
> trillion were outstanding worldwide. MacKenzie suggests that this
> growth could never have happened without the development of theories
> that gave derivatives legitimacy and explained their complexities.
>
> "MacKenzie examines the role played by finance theory in the two most
> serious crises to hit the world’s financial markets in recent years:
> the stock market crash of 1987 and the market turmoil that engulfed
> the hedge fund Long-Term Capital Management in 1998. He also looks at
> finance theory that is somewhat beyond the mainstream—chaos theorist
> Benoit Mandelbrot’s model of “wild” randomness. MacKenzie’s pioneering
> work in the social studies of finance will interest anyone who wants
> to understand how America’s financial markets have grown into their
> current form.
>
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-- Michael Perelman Economics Department California State University Chico, CA 95929
530 898 5321 fax 530 898 5901 http://michaelperelman.wordpress.com