Mathematical Aspects of Financial Markets with Frictions

Frictions are factors that hinder trading of securities in financial markets. Typical frictions include limited market depth, transaction costs, lack of infinite divisibility of securities, and taxes. Conventional models used in mathematical finance often gloss over these issues, which affect almost all financial markets, by arguing that the impact of frictions is negligible and, consequently, the frictionless models are valid approximations. This dissertation consists of three research papers, which are related to the study of the validity of such approximations in two distinct modeling problems. Models of price dynamics that are based on diffusion processes, i.e., continuous strong Markov processes, are widely used in the frictionless scenario. The first paper establishes that diffusion models can indeed be understood as approximations of price dynamics in markets with frictions. This is achieved by introducing an agent-based model of a financial market where finitely many agents trade a financial security, the price of which evolves according to price impacts generated by trades. It is shown that, if the number of agents is large, then under certain assumptions the price process of security, which is a pure-jump process, can be approximated by a one-dimensional diffusion process. In a slightly extended model, in which agents may exhibit herd behavior, the approximating diffusion model turns out to be a stochastic volatility model. Finally, it is shown that when agents' tendency to herd is strong, logarithmic returns in the approximating stochastic volatility model are heavy-tailed. The remaining papers are related to no-arbitrage criteria and superhedging in continuous-time option pricing models under small-transaction-cost asymptotics. Guasoni, Rásonyi, and Schachermayer have recently shown that, in such a setting, any financial security admits no arbitrage opportunities and there exist no feasible superhedging strategies for European call and put options written on it, as long as its price process is continuous and has the so-called conditional full support (CFS) property. Motivated by this result, CFS is established for certain stochastic integrals and a subclass of Brownian semistationary processes in the two papers. As a consequence, a wide range of possibly non-Markovian local and stochastic volatility models have the CFS property.

Modeling Asymmetries in Financial Data with Multiplicative Error Models

This thesis addresses modeling of financial time series, especially stock market returns and daily price ranges. Modeling data of this kind can be approached with so-called multiplicative error models (MEM). These models nest several well known time series models such as GARCH, ACD and CARR models. They are able to capture many well established features of financial time series including volatility clustering and leptokurtosis. In contrast to these phenomena, different kinds of asymmetries have received relatively little attention in the existing literature. In this thesis asymmetries arise from various sources. They are observed in both conditional and unconditional distributions, for variables with non-negative values and for variables that have values on the real line. In the multivariate context asymmetries can be observed in the marginal distributions as well as in the relationships of the variables modeled. New methods for all these cases are proposed. Chapter 2 considers GARCH models and modeling of returns of two stock market indices. The chapter introduces the so-called generalized hyperbolic (GH) GARCH model to account for asymmetries in both conditional and unconditional distribution. In particular, two special cases of the GARCH-GH model which describe the data most accurately are proposed. They are found to improve the fit of the model when compared to symmetric GARCH models. The advantages of accounting for asymmetries are also observed through Value-at-Risk applications. Both theoretical and empirical contributions are provided in Chapter 3 of the thesis. In this chapter the so-called mixture conditional autoregressive range (MCARR) model is introduced, examined and applied to daily price ranges of the Hang Seng Index. The conditions for the strict and weak stationarity of the model as well as an expression for the autocorrelation function are obtained by writing the MCARR model as a first order autoregressive process with random coefficients. The chapter also introduces inverse gamma (IG) distribution to CARR models. The advantages of CARR-IG and MCARR-IG specifications over conventional CARR models are found in the empirical application both in- and out-of-sample. Chapter 4 discusses the simultaneous modeling of absolute returns and daily price ranges. In this part of the thesis a vector multiplicative error model (VMEM) with asymmetric Gumbel copula is found to provide substantial benefits over the existing VMEM models based on elliptical copulas. The proposed specification is able to capture the highly asymmetric dependence of the modeled variables thereby improving the performance of the model considerably. The economic significance of the results obtained is established when the information content of the volatility forecasts derived is examined.

Tannakian Formalism Applied to the Category of Mixed Hodge Structures

Many problems in analysis have been solved using the theory of Hodge structures. P. Deligne started to treat these structures in a categorical way. Following him, we introduce the categories of mixed real and complex Hodge structures. Category of mixed Hodge structures over the field of real or complex numbers is a rigid abelian tensor category, and in fact, a neutral Tannakian category. Therefore it is equivalent to the category of representations of an affine group scheme. The direct sums of pure Hodge structures of different weights over real or complex numbers can be realized as a representation of the torus group, whose complex points is the Cartesian product of two punctured complex planes. Mixed Hodge structures turn out to consist of information of a direct sum of pure Hodge structures of different weights and a nilpotent automorphism. Therefore mixed Hodge structures correspond to the representations of certain semidirect product of a nilpotent group and the torus group acting on it.

Mobiilitunnistamisen hyödyt ja mahdollisuudet Helsingin yliopistossa

Employees and students in University of Helsinki use various services which require authentication. Some of these services require strong authentication. Traditionally this has been realized by meeting in person and presenting an official identification card. Some of these online services can be automatized by implementing existing techniques for strong authentication. Currently strong authentication is implemented by VETUMA-service. Mobile authentication is interesting alternative method. The purpose of this paper is to study the Mobile Signature Service technology and to find out the benefits and possibilities of its use for mobile authentication in University of Helsinki. Mobile authentication is suitable method for implementing strong authentication and for signing documents digitally. Mobile authentication can be used in many different ways in Helsinki university.

A Floor Control Server in a Distributed Conference Service

The conferencing systems in IP Multimedia (IM) networks are going through restructuring, accomplished in the near future. One of the changes introduced is the concept of floors and floor control in its current form with matching entity roles. The Binary Floor Control Protocol (BFCP) is a novelty to be exploited in distributed tightly coupled conferencing services. The protocol defines the floor control server (FCS), which implements floor control giving access to shared resources. As the newest tendency is to distribute the conferencing services, the locations of different functionality units play an important role in developing the standards. The floor control server location is not yet single-mindedly fixed in different standardization bodies, and the debate goes on where to place it within the media server, providing the conferencing service. The thesis main objective is to evaluate two distinctive alternatives in respect the Mp interface protocol between the respective nodes, as the interface in relation to floor control is under standardization work at the moment. The thesis gives a straightforward preamble in IMS network, nodes of interest including floor control server and conferencing. Knowledge on several protocols – BFCP, SDP, SIP and H.248 provides an important background for understanding the functionality changes introduced in the Mp interface and therefore introductions on those protocols and how they are connected to the full picture is given. The actual analysis on the impact of the floor control server into the Mp reference point is concluded in relation to the locations, giving basic flows, requirements analysis including a limited implementation proposal on supporting protocol parameters. The overall conclusion of the thesis is that even if both choices are seemingly useful, not one of the locations is clearly the most suitable in the light of this work. The thesis suggests a solution having both possibilities available to be chosen from in separate circumstances, realized with consistent standardization. It is evident, that if the preliminary assumption for the analysis is kept regarding to only one right place for the floor control server, more work is to be done in connected areas to discover the one most appropriate location.

Ihanne ja todellisuus : Jäsenyyteen sitoutuminen Suomen evankelis-luterilaisessa kirkossa 1960-luvulta 2000-luvulle

The subject of the study is the ideal and reality of commitment to membership in the Evangelical Lutheran Church of Finland from the 1960s to the 2000s. The research task is to ascertain what manner of commitment the Evangelical Lutheran Church of Finland expects from its members (the ideal) and how in reality membership of the Church is realized (empiria). The research object is also to study the extent to which the ideal of commitment evinced by the Church and the actual relation of commitment to the Church changed during the research period. Additionally, those factors were analysed which influence the relation between the ideal and reality of commitment. In the analysis of the ideal of commitment the research data are official documents of the Evangelical Lutheran Church of Finland. They include confessions of the Church, Catechisms, Christian doctrine, joint strategies and plans of the Church, likewise the Church Act and Church Order. The reality of commitment is explored on the basis of Church membership, participation in parish activity and the private practice of religion, likewise attitude to Christian faith. The empirical data of the study comprise Church statistics, material from Statistics Finland and relevant surveys implemented during the research period. The ideal of commitment alongside membership includes knowing the basic tenets of Christian faith and family life based on prayer and participation in liturgical cycles. A member of the Church is expected to take care of his/her faith by living in participation of the Word and sacrament, bearing responsibility for the parish and faithfully discharging his/her worldly obligations. There have been no major changes in the ideal of commitment during the research period. On the contrary, the reality of commitment has changed. Although the majority of Finns are still members of the Church, there has been a constant decline in their share of the population. The same can be stated with respect to parish life. This has its own strengths, among them Church rites, parish activity around feast days and also work with children and confirmation training. However, the general trend is towards a decline in participation. There has also been a decrease in commitment to belief in God as taught by the Church. On the other hand, private religious observance has not changed at all. From the perspective of commitment the Evangelical Lutheran Church of Finland exists in a state of tension between the theological ideal and sociological empiria. Matters exerting a particular influence over the relation between ideal and reality are communality and varying conceptions of the Church, likewise contextuality and the related private Christianity. Societal change poses a challenge to traditional Church communality. A decline in communality has in turn led to a decline in belonging to the Church. Weakening awareness of membership has undermined the handing down of the tradition among younger generations. Modernization has influence the identity of the Church and brought the Church to an internal divergence. This way it has been able to retain its structure as a folk church but at the same time it has lost its opportunities for the formation of a clear identity. The Church has adjusted to societal change by outward-directed activities (performance) alongside the purely religious message (function). The tension between an unchanged message and a changed operating environment has increased. The challenge of contextuality has led the Church to review parish life, the nature of teaching and activity and the language used by the Church, likewise the cultural modus. Increasingly privatized Christianity challenges above all the theology and teaching of the Church, but also the life of worship and relation to cultural life.

Funktionaalinen Transitioteoria : Hallinto, Instituutiot ja Oikeusjärjestys Venäjällä

Functional transition theory: administration, legal order and institutions in Russia This dissertation examines some of the salient characteristics of Russia that are deemed to have impeded the growth of its economy and investments in particular. These characteristics are the volatility of the administrative and legal systems, corruption, and the perceived irrationality and difference in the operating environment in comparison with European conditions. The dissertation is one of the first studies on Russia that approaches the subject from the perspective of comprehensive social scientific theories. The study is based on the structural functionalistic theory, which is widely used in the social sciences. Adopting a sufficiently ambitious theoretical examination will provide a systematic and logical explanation of the characteristics of Russian institutions and ways of operations, such as corruption, that are commonly perceived as inexplicable. The approach adopted in the dissertation sheds light on the history of Russia's development and provides a comparative view of other societies in transition. Furthermore, it suggests recommendations as to how the structures of Russian society could be comprehensively strengthened.

Yhteisöllisyys juutalaisessa kansallisuusajattelussa ja Israelin valtion itsenäisyysjulistuksessa

The Idea of Community in the Jewish National Thinking and in the Proclamation of Independence The aim of this study is to clarify the idea of community in the Jewish national thinking and in the Proclamation of Independence of the State of Israel in 1948. The method is the community analysis. The values of the culture are studied by two- and threefold dimensions on the arena. On the field of that arena one can find the society of order, the society of pressure, the societies made by mosaics and the societies that are breaking apart. The community way of behaving means, that the individuals voluntarily follow common values. The earliest Jewish ideals elevated the concept of unity among the people. The reality in the society was different especially in Roman times when the religious and national thinking was fragmented into four different main views. During the Diaspora the religious tradition mostly warned against pursuing a Jewish state, but many forms of Anti-Judaism and the new national thinking in the nineteenth century created the Zionist movement. The religious Jewish people did not rely on the earthy nationalism and when some of them later chose Zionism, they stressed the religious aspects in governing the state. The cultural Zionists preferred a slower and more low key spiritual way of change. The Revisionists saw no alternatives but to use military force. Many in the majority, the Labour movement, hoped that the progress brought to the region by Zionism would change the minds of opponents. The general appearance of the proclamation is optimistic. It characterizes national and political unity gathering people who think differently and who come from different factions of the Jewish political and cultural orientation. These people can be placed on different corners in the community analysis. The proclamation concentrates on state and administrative points of view. It aims at a state for the Jews, and the Jewishness of the state is more clearly seen in later legislation. The hope for co-operation from all sides was clearly articulated. The central aim was the security of the Jews. The proclamation has a community quotation because it aimed to build up a net of cooperation. The vision of building a nation of their own is balanced by the collaboration with the Arabs and the international community. In the same roclamation the individual civil rights are side by side with the Prophets thoughts about peace and justice. The Proclamation describes a society of a good order which aims at uniting the people. In the midst of grave difficulties a noble proclamation of national and international co-operation was created. It was not taken for granted that the ideals would be realized. The care of the national homeland could become egocentric nationalism and the attention to the Prophets heritage could turn to emphasizing strict religious rules or to isolation from others. The emphasis of civil rights could turn to assimilation or in other words to other kinds of values in their own country.

Pre- and post-copulatory sexual selection in the least killifish, Heterandria formosa

It has been only recently realized that sexual selection does not end at copulation but that post-copulatory processes are often important in determining the fitness of individuals. In this thesis, I experimentally studied both pre- and post-copulatory sexual selection in the least killifish, Heterandria formosa. I found that this species suffers from severe inbreeding depression in male reproductive behaviour, offspring viability and offspring maturation times. Neither sex showed pre-copulatory inbreeding avoidance but when females mated with their brothers, less sperm were retrieved from their reproductive system compared to the situation when females mated with unrelated males. Whether the difference in sperm numbers is due to female or male effect could not be resolved. Based on theory, females should be more eager to avoid inbreeding than males in this species, because females invest more in their offspring than males do. Inbreeding seems to be an important part of this species biology and the severe inbreeding depression has most likely selected for the evolution of the post-copulatory inbreeding avoidance mechanism that I found. In addition, I studied the effects of polyandry on female reproductive success. When females mated with more than one male, they were more likely to get pregnant. However, I also found a cost of polyandry. The offspring of females mated to four males took longer to reach sexual maturity compared to the offspring of monandrous females. This cost may be explained by parent-offspring conflict over maternal resource allocation. In another experiment, in which within-brood relatedness was manipulated, offspring sizes decreased over time when within-brood relatedness was low. This result is partly in accordance with the kinship theory of genomic imprinting. When relatedness decreases, offspring are expected to be less co-operative and demand fewer resources from their mother, which leads to impaired development. In the last chapter of my thesis, I show that H. formosa males do not prefer large females as in other Poeciliidae species. I suggest that males view smaller females as more profitable mates because those are more likely virgin. In conclusion, I found both pre- and post-copulatory sexual selection to be important factors in determining reproductive success in H. formosa.

Lapset ja nuoret ympäristökansalaisina : Ympäristökasvatuksen näkökulma osallistumiseen

Children and young people as environmental citizens the environmental education perspective to participation This doctoral thesis examines the participation of children and young people in developing their own environment at school, as a part of environmental education. The aim of the research is to assess and consider children and young people s environmentally responsible participation and its effectiveness in relation to the participants own learning and the end results of the participation. The research combines the perspectives of environmental education and citizenship education through the concept of environmental citizenship. Environmental education, which enhances environmental citizenship, offers children and young people the possibility to be active citizens and learn about citizenship in their own lives by taking action themselves. The research is made up of two parts which complement each other. The first part consists of an action research carried out in the Joensuu Lyseo Upper Secondary School, where an environmental education course with a traffic-related theme was planned, developed and evaluated. The second part is made up of an interview survey carried out in Helsinki. In the survey actors from schools and various city offices, who were involved in development projects of school environments, were interviewed. According to the research results, all-round cooperation and more open relations with those outside of the school environment are important ways to support environmental citizenship in schools. Thus, environmentally responsible participation offers a chance to learn competence that an environmental citizen needs the knowledge, skills and willingness to act that have not been successfully taught through traditional school education. The research introduces a model of environmentally responsible participation as a learning process, in which learning is studied through the development of competence, self-empowerment and social empowerment. The model makes the context of environmental education visible and puts emphasis on reflection in the learning process. A central factor in children and young people s self-empowerment is the sense of being heard and taken into consideration. At the moment children and young people s rights to participate are strong, due to legislation, school curricula, and several national and international agreements. Despite this, involving them in developing their own immediate surroundings has not become a part of schools and planning organisations daily life and established methods. Reasons for this situation can be found in the lack of regard and resources for these matters, in the complex nature of planning and a long time frame, and the problems of ownership and of reaching each other. Central to overcoming these obstacles are a gradual change in conduct and mentalities and the strengthening of teachers and officials competence. Children and young people need different ways and methods of varying levels of involvement, structures and arenas which enable participation and in which environmental citizenship can be realized. Key words: environmental citizenship, environmental education, citizenship education, children and young people s participation, social learning, self-empowerment, social empowerment, school, community planning

Structure and Dynamics of Coil-like Molecules by Residual Dipolar Couplings

Nuclear magnetic resonance (NMR) spectroscopy provides us with many means to study biological macromolecules in solution. Proteins in particular are the most intriguing targets for NMR studies. Protein functions are usually ascribed to specific three-dimensional structures but more recently tails, long loops and non-structural polypeptides have also been shown to be biologically active. Examples include prions, -synuclein, amylin and the NEF HIV-protein. However, conformational preferences in coil-like molecules are difficult to study by traditional methods. Residual dipolar couplings (RDCs) have opened up new opportunities; however their analysis is not trivial. Here we show how to interpret RDCs from these weakly structured molecules. The most notable residual dipolar couplings arise from steric obstruction effects. In dilute liquid crystalline media as well as in anisotropic gels polypeptides encounter nematogens. The shape of a polypeptide conformation limits the encounter with the nematogen. The most elongated conformations may come closest whereas the most compact remain furthest away. As a result there is slightly more room in the solution for the extended than for the compact conformations. This conformation-dependent concentration effect leads to a bias in the measured data. The measured values are not arithmetic averages but essentially weighted averages over conformations. The overall effect can be calculated for random flight chains and simulated for more realistic molecular models. Earlier there was an implicit thought that weakly structured or non-structural molecules would not yield to any observable residual dipolar couplings. However, in the pioneering study by Shortle and Ackerman RDCs were clearly observed. We repeated the study for urea-denatured protein at high temperature and also observed indisputably RDCs. This was very convincing to us but we could not possibly accept the proposed reason for the non-zero RDCs, namely that there would be some residual structure left in the protein that to our understanding was fully denatured. We proceeded to gain understanding via simulations and elementary experiments. In measurements we used simple homopolymers with only two labelled residues and we simulated the data to learn more about the origin of RDCs. We realized that RDCs depend on the position of the residue as well as on the length of the polypeptide. Investigations resulted in a theoretical model for RDCs from coil-like molecules. Later we extended the studies by molecular dynamics. Somewhat surprisingly the effects are small for non-structured molecules whereas the bias may be large for a small compact protein. All in all the work gave clear and unambiguous results on how to interpret RDCs as structural and dynamic parameters of weakly structured proteins.

Understanding the chemistry of atmospheric aerosol particle formation via observations of physical properties

It is widely accepted that the global climate is heating up due to human activities, such as burning of fossil fuels. Therefore we find ourselves forced to make decisions on what measures, if any, need to be taken to decrease our warming effect on the planet before any irrevocable damage occurs. Research is being conducted in a variety of fields to better understand all relevant processes governing Earth s climate, and to assess the relative roles of anthropogenic and biogenic emissions into the atmosphere. One of the least well quantified problems is the impact of small aerosol particles (both of anthropogenic and biogenic origin) on climate, through reflecting solar radiation and their ability to act as condensation nuclei for cloud droplets. In this thesis, the compounds driving the biogenic formation of new particles in the atmosphere have been examined through detailed measurements. As directly measuring the composition of these newly formed particles is extremely difficult, the approach was to indirectly study their different characteristics by measuring the hygroscopicity (water uptake) and volatility (evaporation) of particles between 10 and 50 nm. To study the first steps of the formation process in the sub-3 nm range, the nucleation of gaseous precursors to small clusters, the chemical composition of ambient naturally charged ions were measured. The ion measurements were performed with a newly developed mass spectrometer, which was first characterized in the laboratory before being deployed at a boreal forest measurement site. It was also successfully compared to similar, low-resolution instruments. The ambient measurements showed that sulfuric acid clusters dominate the negative ion spectrum during new particle formation events. Sulfuric acid/ammonia clusters were detected in ambient air for the first time in this work. Even though sulfuric acid is believed to be the most important gas phase precursor driving the initial cluster formation, measurements of the hygroscopicity and volatility of growing 10-50 nm particles in Hyytiälä showed an increasing role of organic vapors of a variety of oxidation levels. This work has provided additional insights into the compounds participating both in the initial formation and subsequent growth of atmospheric new aerosol particles. It will hopefully prove an important step in understanding atmospheric gas-to-particle conversion, which, by influencing cloud properties, can have important climate impacts. All available knowledge needs to be constantly updated, summarized, and brought to the attention of our decision-makers. Only by increasing our understanding of all the relevant processes can we build reliable models to predict the long-term effects of decisions made today.

Numerical approaches to new particle formation and growth in the atmosphere

Aerosols impact the planet and our daily lives through various effects, perhaps most notably those related to their climatic and health-related consequences. While there are several primary particle sources, secondary new particle formation from precursor vapors is also known to be a frequent, global phenomenon. Nevertheless, the formation mechanism of new particles, as well as the vapors participating in the process, remain a mystery. This thesis consists of studies on new particle formation specifically from the point of view of numerical modeling. A dependence of formation rate of 3 nm particles on the sulphuric acid concentration to the power of 1-2 has been observed. This suggests nucleation mechanism to be of first or second order with respect to the sulphuric acid concentration, in other words the mechanisms based on activation or kinetic collision of clusters. However, model studies have had difficulties in replicating the small exponents observed in nature. The work done in this thesis indicates that the exponents may be lowered by the participation of a co-condensing (and potentially nucleating) low-volatility organic vapor, or by increasing the assumed size of the critical clusters. On the other hand, the presented new and more accurate method for determining the exponent indicates high diurnal variability. Additionally, these studies included several semi-empirical nucleation rate parameterizations as well as a detailed investigation of the analysis used to determine the apparent particle formation rate. Due to their high proportion of the earth's surface area, oceans could potentially prove to be climatically significant sources of secondary particles. In the lack of marine observation data, new particle formation events in a coastal region were parameterized and studied. Since the formation mechanism is believed to be similar, the new parameterization was applied in a marine scenario. The work showed that marine CCN production is feasible in the presence of additional vapors contributing to particle growth. Finally, a new method to estimate concentrations of condensing organics was developed. The algorithm utilizes a Markov chain Monte Carlo method to determine the required combination of vapor concentrations by comparing a measured particle size distribution with one from an aerosol dynamics process model. The evaluation indicated excellent agreement against model data, and initial results with field data appear sound as well.

Human Rights in Action

In the post-World War II era human rights have emerged as an enormous global phenomenon. In Finland human rights have particularly in the 1990s moved from the periphery to the center of public policy making and political rhetoric. Human rights education is commonly viewed as the decisive vehicle for emancipating individuals of oppressive societal structures and rendering them conscious of the equal value of others; both core ideals of the abstract discourse. Yet little empirical research has been conducted on how these goals are realized in practice. These factors provide the background for the present study which, by combining anthropological insights with critical legal theory, has analyzed the educational activities of a Scandinavian and Nordic network of human rights experts and PhD students in 2002-2005. This material has been complemented by data from the proceedings of UN human rights treaty bodies, hearings organized by the Finnish Foreign Ministry, the analysis of different human rights documents as well as the manner human rights are talked of in the Finnish media. As the human rights phenomenon has expanded, human rights experts have acquired widespread societal influence. The content of human rights remains, nevertheless, ambiguous: on the one hand they are law, on the other, part of a moral discourse. By educating laymen on what human rights are, experts act both as intermediaries and activists who expand the scope of rights and simultaneously exert increasing political influence. In the educational activities of the analyzed network these roles were visible in the rhetorics of legality and legitimacy . Among experts both of these rhetorics are subject to ongoing professional controversy, yet in the network they are presented as undisputable facts. This contributes to the impression that human rights knowledge is uncontested. This study demonstrates how the network s activities embody and strengthen a conception of expertise as located in specific, structurally determined individuals. Simultaneously its conception of learning emphasizes the adoption of knowledge by students, emphasizing the power of experts over them. The majority of the network s experts are Nordic males, whereas its students are predominantly Nordic females and males from East-European and developing countries. Contrary to the ideals of the discourse the network s activities do not create dialogue, but instead repeat power structures which are themselves problematic.

Toiminta, valta ja kokemus organisaation muutoksessa : Tutkimus kolmesta suuryrityksestä

Action, Power and Experience in Organizational Change - A Study of Three Major Corporations This study explores change management and resistance to change as social activities and power displays through worker experiences in three major Finnish corporations. Two important sensitizing concepts were applied. Firstly, Richard Sennett's perspective on work in the new form of capitalism, and its shortcomings - the lack of commitment and freedom accompanied by the disruption to lifelong career planning and the feeling of job insecurity - offered a fruitful starting point for a critical study. Secondly, Michel Foucault's classical concept of power, treated as anecdotal, interactive and nonmeasurable, provided tools for analyzing change-enabling and resisting acts. The study bridges the gap between management and social sciences. The former have usually concentrated on leadership issues, best practices and goal attainment, while the latter have covered worker experiences, power relations and political conflicts. The study was motivated by three research questions. Firstly, why people resist or support changes in their work, work environment or organization, and the kind of analyses these behavioural choices are based on. Secondly, the kind of practical forms which support for, and resistance to change take, and how people choose the different ways of acting. Thirdly, how the people involved experience and describe their own subject position and actions in changing environments. The examination focuses on practical interpretations and action descriptions given by the members of three major Finnish business organizations. The empirical data was collected during a two-year period in the Finnish Post Corporation, the Finnish branch of Vattenfal Group, one of the leading European energy companies, and the Mehiläinen Group, the leading private medical service provider in Finland. It includes 154 non-structured thematic interviews and 309 biographies concentrating on personal experiences of change. All positions and organizational levels were represented. The analysis was conducted using the grounded theory method introduced by Straus and Corbin in three sequential phases, including open, axial and selective coding processes. As a result, there is a hierarchical structure of categories, which is summarized in the process model of change behaviour patterns. Key ingredients are past experiences and future expectations which lead to different change relations and behavioural roles. Ultimately, they contribute to strategic and tactical choices realized as both public and hidden forms of action. The same forms of action can be used in both supporting and resisting change, and there are no specific dividing lines either between employer and employee roles or between different hierarchical positions. In general, however, it is possible to conclude that strategic choices lead more often to public forms of action, whereas tactical choices result in hidden forms. The primary goal of the study was to provide knowledge which has practical applications in everyday business life, HR and change management. The results, therefore, are highly applicable to other organizations as well as to less change-dominated situations, whenever power relations and conflicting interests are present. A sociological thesis on classical business management issues can be of considerable value in revealing the crucial social processes behind behavioural patterns. Keywords: change management, organizational development, organizational resistance, resistance to change, change management, labor relations, organization, leadership