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Table of contents (9 chapters)
About this book
This introductory text is devoted to exposing the underlying nature of price formation in financial markets as a predominantly sociological phenomenon that relates individual decision-making to emergent and co-evolving social and financial structures.
Two different levels of this sociological influence are considered: First, we examine how price formation results from the social dynamics of interacting individuals, where interaction occurs either through the price or by direct communication. Then the same processes are revisited and examined at the level of larger groups of individuals.
In this book, models of both levels of socio-finance are presented, and it is shown, in particular, how complexity theory provides the conceptual and methodological tools needed to understand and describe such phenomena. Accordingly, readers are first given a broad introduction to the standard economic theory of rational financial markets and will come to understand its shortcomings with the help of concrete examples. Complexity theory is then introduced in order to properly account for behavioral decision-making and match the observed market dynamics.
This book is conceived as a primer for newcomers to the field, as well as for practitioners seeking new insights into the field of complexity science applied to socio-economic systems in general, and financial markets and price formation in particular.
- Behavioral finance
- Economic theory and financial crisis
- Econophysics of financial markets
- Financial market complexity
- Psychosocial decision making
- data-driven science, modeling and theory building
- quantitative finance
Authors and Affiliations
CNRS; Centre d'Économie de la Sorbonne, University of Paris 1, Paris, France
Jørgen Vitting Andersen
Faculty of Psychology, University of Warsaw, Warsaw, Poland
Book Title: An Introduction to Socio-Finance
Authors: Jørgen Vitting Andersen, Andrzej Nowak
Publisher: Springer Berlin, Heidelberg
Copyright Information: Springer-Verlag Berlin Heidelberg 2013
Hardcover ISBN: 978-3-642-41943-0Published: 30 December 2014
Softcover ISBN: 978-3-662-52021-5Published: 20 August 2016
eBook ISBN: 978-3-642-41944-7Published: 11 December 2013
Edition Number: 1
Number of Pages: XIII, 185
Number of Illustrations: 35 b/w illustrations, 9 illustrations in colour