Economic Theory Commons^™

A Forensic Analysis Of Global Imbalances, Menzie David Chinn, Barry Eichengreen, Hiro Ito

Economics Faculty Publications and Presentations

We examine whether the behavior of current account balances changed in the years preceding the global crisis of 2008-09, and assess the prospects for global imbalances in the post-crisis period. Changes in the budget balance are an important factor affecting current account balances for deficit countries such as the U.S. and the U.K. The effect of the “saving glut variables” on current account balances has been relatively stable for emerging market countries, suggesting that those factors cannot explain the bulk of their recent current account movements. We also find the 2006-08 period to constitute a structural break for emerging market …

The Marginalist Revolution In Corporate Finance: 1880-1965, Herbert J. Hovenkamp

All Faculty Scholarship

During the late nineteenth and early twentieth centuries fundamental changes in economic thought revolutionized the theory of corporate finance, leading to changes in its legal regulation. The changes were massive, and this branch of financial analysis and law became virtually unrecognizable to those who had practiced it earlier. The source of this revision was the marginalist, or neoclassical, revolution in economic thought. The classical theory had seen corporate finance as an historical, relatively self-executing inquiry based on the classical theory of value and administered by common law courts. By contrast, neoclassical value theory was forward looking and as a result …

A Preface To Neoclassical Legal Thought, Herbert J. Hovenkamp

All Faculty Scholarship

Most legal historians speak of the period following classical legal thought as “progressive legal thought.” That term creates an unwarranted bias in characterization, however, creating the impression that conservatives clung to an obsolete “classical” ideology, when in fact they were in many ways just as revisionist as the progressives legal thinkers whom they critiqued. The Progressives and New Deal thinkers whom we identify with progressive legal thought were nearly all neoclassical, or marginalist, in their economics, but it is hardly true that all marginalists were progressives. For example, the lawyers and policy makers in the corporate finance battles of the …

Corrigendum To "A Gaussian Approach For Continuous Time Models Of The Short Term Interest Rate", Peter C. B. Phillips, Jun Yu

Research Collection School Of Economics

An error is corrected in Yu and Phillips (2001) (Econometrics Journal, 4, 210-224) where a time transformation was used to induce Gaussian disturbances in the discrete time equivalent model. It is shown that the error process in this model is not a martingale and the Dambis, Dubins-Schwarz (DDS) theorem is not directly applicable. However, a detrended error process is a martingale, the DDS theorem is applicable, and the corresponding stopping time correctly induces Gaussianity. We show that the two stopping time sequences differ by O(a2), where a is the pre-specified normalized timing constant.

Finanzkapital In The Twenty-First Century, Nikhilesh Dholakia

College of Business Faculty Publications

Purpose – Drawing inspiration from the 1910 book Finanzkapital by Rudolf Hilferding, this paper seeks to explore the nature of financial capital in the early twenty-first century from a political-economic and culture theory perspective. It aims to offer suggestions for transcending the crises-prone contemporary economic systems.

Design/methodology/approach – The paper reconceptualises the notions of Finanzkapital in the contemporary context, drawing selective evidence from current and twentieth century economic and business history.

Findings – The nature of contemporaneous Finanzkapital is elaborated by presenting seven “theses” that probe the nature of Finanzkapital prior to, during, and after the Great Recession of 2007-9. …

Currency Trading Using The Fractal Market Hypothesis, Jonathan Blackledge, Kieran Murphy

Articles

We report on a research and development programme in financial modelling and economic security undertaken in the Information and Communications Security Research Group (ICSRG, 2011) which has led to the launch of a new company - Currency Traders Ireland Limited - funded by Enterprise Ireland. Currency Traders Ireland Limited (CTI, 2011) has a fifty year exclusive license to develop a new set of indicators for analysing currency exchange rates (Forex trading). We consider the background to the approach taken and present examples of the results obtained to date.

Forex Trading Using Metatrader 4 With The Fractal Market Hypothesis, Jonathan Blackledge, Kieran Murphy

Conference papers

This paper reports on the results of a research and development programme concerned with the analysis of currency pair exchange time series for Forex trading in an intensive applications and services environment. In particular, we present some of the preliminary results obtained for Forex trading using MetaTrader 4 with a new set of trend indicators deigned using a mathematical model that is based on the Fractal Market Hypothesis. This includes examples of various currency pair exchange rates considered over different time intervals and use of the indicators in a live trading environment to place a buy/sell order.