Description
Unlock a deeper understanding of market dynamics with 'Beyond Mechanical Markets' by Roman Frydman and Michael Goldberg. This insightful book delves into the complexities of financial markets in the aftermath of the 2007 global financial crisis, challenging the conventional wisdom that emphasizes mechanical predictability. The authors argue that both rational and behavioral theories mistakenly assume market predictability, which ultimately limits our comprehension of price swings and their essential role in allocating capital to deserving companies. With fresh perspectives gleaned from imperfect knowledge economics, Frydman and Goldberg present a compelling critique of established economic paradigms. Learn why understanding the imperfect nature of market assessments can lead to better economic reforms and strategies to manage price volatility. This pivotal text not only critiques the herd psychology that underpins many financial bubbles but also offers thoughtful insights into how markets truly operate. Ideal for economists, investors, and anyone interested in the intricate relationship between market behaviors and economic fundamentals, 'Beyond Mechanical Markets' is a must-read for those looking to navigate the complexities of the financial world. With a publication year of 2011 and issued by Princeton University Press, this trade-bound book is in BRAND NEW condition. Note: Shipping for this item is free. Please allow up to 6 weeks for delivery. Once your order is placed, it cannot be cancelled.
Note: Shipping for this item is free. Please allow up to 6 weeks for delivery. Once your order is placed, it cannot be cancelled.
Condition: BRAND NEW
ISBN: 9780691145778
Format: Trade binding
Year: 2011
Publisher: Princeton University Press
Description:
In the wake of the global financial crisis that began in 2007, faith in the rationality of markets has lost ground to a new faith in their irrationality. The problem, Roman Frydman and Michael Goldberg argue, is that both the rational and behavioral theories of the market rest on the same fatal assumption - that markets act mechanically and economic change is fully predictable. In "Beyond Mechanical Markets", Frydman and Goldberg show how the failure to abandon this assumption hinders our understanding of how markets work, why price swings help allocate capital to worthy companies, and what role government can and can't play. The financial crisis, Frydman and Goldberg argue, was made more likely, if not inevitable, by contemporary economic theory, yet its core tenets remain unchanged today. In response, the authors show how imperfect knowledge economics, an approach they pioneered, provides a better understanding of markets and the financial crisis. Frydman and Goldberg deliver a withering critique of the widely accepted view that the boom in equity prices that ended in 2007 was a bubble fueled by herd psychology.
They argue, instead, that price swings are driven by individuals' ever-imperfect interpretations of the significance of economic fundamentals for future prices and risk. Because swings are at the heart of a dynamic economy, reforms should aim only to curb their excesses. Showing why we are being dangerously led astray by thinking of markets as predictably rational or irrational, Beyond Mechanical Markets presents a powerful challenge to conventional economic wisdom that we can't afford to ignore.
Note: Shipping for this item is free. Please allow up to 6 weeks for delivery. Once your order is placed, it cannot be cancelled.
Condition: BRAND NEW
ISBN: 9780691145778
Format: Trade binding
Year: 2011
Publisher: Princeton University Press
Description:
In the wake of the global financial crisis that began in 2007, faith in the rationality of markets has lost ground to a new faith in their irrationality. The problem, Roman Frydman and Michael Goldberg argue, is that both the rational and behavioral theories of the market rest on the same fatal assumption - that markets act mechanically and economic change is fully predictable. In "Beyond Mechanical Markets", Frydman and Goldberg show how the failure to abandon this assumption hinders our understanding of how markets work, why price swings help allocate capital to worthy companies, and what role government can and can't play. The financial crisis, Frydman and Goldberg argue, was made more likely, if not inevitable, by contemporary economic theory, yet its core tenets remain unchanged today. In response, the authors show how imperfect knowledge economics, an approach they pioneered, provides a better understanding of markets and the financial crisis. Frydman and Goldberg deliver a withering critique of the widely accepted view that the boom in equity prices that ended in 2007 was a bubble fueled by herd psychology.
They argue, instead, that price swings are driven by individuals' ever-imperfect interpretations of the significance of economic fundamentals for future prices and risk. Because swings are at the heart of a dynamic economy, reforms should aim only to curb their excesses. Showing why we are being dangerously led astray by thinking of markets as predictably rational or irrational, Beyond Mechanical Markets presents a powerful challenge to conventional economic wisdom that we can't afford to ignore.