MIT Press
An Engine, Not a Camera: How Financial Models Shape Markets
Key Metrics
- Donald MacKenzie
- MIT Press
- Paperback
- 9780262633673
- 8.8 X 5.9 X 0.9 inches
- 1.15 pounds
- Technology & Engineering > Social Aspects
- English
Secure TransactionBook Description
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.
Author Bio
I'm a sociologist of science and technology, and my research aims to throw new light on their role in shaping the modern world. I work on topics such as how financial-market participants use mathematical models, how nuclear weapons systems are designed, and how those involved try to produce high-confidence knowledge of the safety and security of computer systems.
Currently, I'm researching two topics: automated 'high-frequency trading' (HFT project), and AdTech, the technical/economic systems of online advertising (AdTech project).
My book on HFT, Trading at the Speed of Light: How Ultrafast Algorithms Are Transforming Financial Markets (also available as audiobook), was published by Princeton University Press in May; read an early review by Diane Coyle.
Previous books include Inventing Accuracy: A Historical Sociology of Nuclear Missile Guidance (MIT Press, 1990); An Engine, Not a Camera: How Financial Models Shape Markets (MIT Press, 2006); and Chains of Finance: How Investment Management is Shaped (Oxford University Press, 2017), jointly written with Diane-Laure Arjaliès, Philip Grant, Iain Hardie and Ekaterina Svetlova.
Source: The University of Edinburgh
Videos
No Videos
Community reviews
Write a ReviewNo Community reviews