Co-operative and Alternative Finance for Agricultural/Food Communities : European Developments

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Frontiers of finance: Evolution and efficient markets

In this review article, we explore several recent advances in the quantitative modeling of financial markets. We begin with the Efficient Markets Hypothesis and describe how this controversial idea has stimulated a number of new directions of research, some focusing on more elaborate mathematical models that are capable of rationalizing the empirical facts, others taking a completely different tack in rejecting rationality altogether. One of the most promising directions is to view financial markets from a biological perspective and, specifically, within an evolutionary framework in which markets, instruments, institutions, and investors interact and evolve dynamically according to the “law” of economic selection. Under this view, financial agents compete and adapt, but they do not necessarily do so in an optimal fashion. Evolutionary and ecological models of financial markets is truly a new frontier whose exploration has just begun.

Management science, economics and finance: A connection

This paper provides a brief review of the connecting literature in management science, economics and finance, and discusses some research that is related to the three disciplines. Academics could develop theoretical models and subsequent econometric models to estimate the parameters in the associated models, and analyze some interesting issues in the three disciplines.

Fashions and fads in finance: contingent emulation and the political economy of sovereign wealth fund creation. IHS Political Science Series No. 131, July 2012

Sovereign wealth funds (SWFs), government-owned or managed investment vehicles, have proliferated at a remarkable rate over the past decade, even as political controversy has surrounded them. Why? The extant literature depicts the process of SWF creation as driven by functional imperatives associated with “excess” revenue and reserves accumulated from commodity booms and large current account surpluses. I argue that SWF creation also reflects in large part a process of contingent emulation in which first this policy has been constructed as appropriate for countries with given characteristics, and then when countries took on these characteristics, they followed their peers. Put simply, fashions and fads in finance matter for policy diffusion. I assess this argument using a new dataset on SWF creation that covers nearly 80 countries from 1984 to 2007. The results suggest peer-based contingent emulation has been a crucial factor shaping the decision of many countries to create a SWF, especially among fuel exporters. An earlier version of this paper was presented at the annual meeting of the American Political Science Association, Washington, DC, 2 – 5 September 2010. The author would like to thank Eric Neumayer for his many suggestions and comments on previous versions of the manuscript. The author would also like to thank Zachary Elkins for sharing data. Finally, the author would like to acknowledge the research assistance of Natali Bulamacioglu and Christopher Gandrud.