Comment by JumpCrisscross
13 hours ago
> Quant finance doesn't claim to be devising grand theories about how the world operates
What do you base this on?
13 hours ago
> Quant finance doesn't claim to be devising grand theories about how the world operates
What do you base this on?
What's quintessential quant finance? Black-Scholes and no-arbitrage pricing. Don't you agree it's much more of a tool than a theory of how the world works.
> What's quintessential quant finance? Black-Scholes and no-arbitrage pricing
This is a bad model to pick to exemplify physics envy given it’s based on thermodynamic dispersion.
The term “physics envy” broadly applies to all social sciences lacking a mathematical basis. It’s a criticism of using math where it doesn’t belong. That hasn’t really fit (until very recently) with economics. It’s been a classic complaint about quantitative finance’s loftier visions of universality.
> This is a bad model to pick to exemplify physics envy given it’s based on thermodynamic dispersion.
Using a model derived from physics is not having physics envy.
> The term “physics envy” broadly applies to all social sciences lacking a mathematical basis
No, physics envy is about thinking you can have the same prediction power as physics using simple mathematical tools just because some branch of physics do (while not understanding physics at the same time, because all of physics definitely doesn't work like that).
> It’s a criticism of using math where it doesn’t belong. That hasn’t really fit (until very recently) with economics
Well, if you consider Ricardo to be recent, maybe…