Book contents
- Frontmatter
- Dedication
- Contents
- Foreword
- Preface
- Acknowledgements
- List of symbols
- I Physics concepts in social science? A discussion
- II Mathematics and physics preliminaries
- III Quantum probabilistic effects in psychology: basic questions and answers
- IV Other quantum probabilistic effects in economics, finance, and brain sciences
- 10 Financial/economic theory in crisis
- 11 Bohmian mechanics in finance and economics
- 12 The Bohm–Vigier model and path simulation
- 13 Other applications to economic/financial theory
- 14 Neurophysiological sources of quantum-like processing in the brain
- 15 Conclusion
- Glossary of mathematics, physics, and economics/finance terms
- Index
10 - Financial/economic theory in crisis
from IV - Other quantum probabilistic effects in economics, finance, and brain sciences
Published online by Cambridge University Press: 05 July 2013
- Frontmatter
- Dedication
- Contents
- Foreword
- Preface
- Acknowledgements
- List of symbols
- I Physics concepts in social science? A discussion
- II Mathematics and physics preliminaries
- III Quantum probabilistic effects in psychology: basic questions and answers
- IV Other quantum probabilistic effects in economics, finance, and brain sciences
- 10 Financial/economic theory in crisis
- 11 Bohmian mechanics in finance and economics
- 12 The Bohm–Vigier model and path simulation
- 13 Other applications to economic/financial theory
- 14 Neurophysiological sources of quantum-like processing in the brain
- 15 Conclusion
- Glossary of mathematics, physics, and economics/finance terms
- Index
Summary
In this chapter and Chapters 11, 12, and 13, we will discuss quantum-like models with financial applications in mind. The very last chapter of this book will analyze the sources of quantum-like processing in the brain.
The concept of non-arbitrage, as we have indicated before (see Section 4.18.3) is of key importance in financial models. We reiterate its importance in this chapter. We also briefly mention a popular finance model. In the coming chapters, the wave function will sometimes have an information interpretation. Therefore we also discuss the informational aspects of the classical financial theory (see Section 10.1). This chapter is meant to introduce the reader to some of the key achievements in financial theory. By doing so, we hope to convince the reader, in later chapters, that some of those very achievements can possibly be reformulated with the help of the wave function approach. Section 10.3 in this chapter will give a flavor of how Fourier integration can possibly be used to model George Soros' concept of reflexivity.
Relevance of the concepts of efficiency and non-arbitrage: a brief discussion
With the 2008 financial crisis, the concept of efficiency may have been seriously questioned. Indeed the financial market in September 2008 did take a tremendous hit and the ensuing price movements would not be consistent with a so-called efficient market.
- Type
- Chapter
- Information
- Quantum Social Science , pp. 173 - 183Publisher: Cambridge University PressPrint publication year: 2013