Derivatives and the Wealth of Societies

Derivatives and the Wealth of Societies

Benjamin Lee and Randy Martin

Print publication date: 2017

ISBN: 9780226392660

Publisher: University of Chicago Press

Abstract

This book is a unique collaboration that looks at derivative finance from the standpoint of the social sciences and the social sciences from that of finance. It joins experts from different intellectual backgrounds with disparate trajectories of application. These include knowledge domains of financial engineering, sociology, anthropology, arts activism, media/cultural studies, design, and philosophy. The social reading of the derivative draws upon discussions of the gift, ritual, play, and performativity while the derivative reading of the social adds concepts like volatility and arbitrage to our social science tool-kit. It creates new juxtapositions to understand the relations between finance and society in our contemporary “derivative capitalism,” like Black and Weber on uncertainty, the gift as a contingent claim, or even the “derivative” nature of skateboarding. The book argues that the breakthrough in derivative finance is the discovery and pricing of volatility, enshrined in the Black-Scholes model. Yet the discovery of volatility is also a cultural phenomenon and this book provides the intellectual framework for understanding it, which is especially important in our “culture and politics of volatility.” The mathematical arcana of contemporary finance often prevent dialog and accessible cross-fertilization among disparate domains. But to avoid the technical leaves us in the dark about how derivative finance insinuates itself into the social. By bringing together diverse authors, the book is a new model for collaboration in which academic disciplines and professional practice work together to understand the social dimensions of the derivative and the derivative dimensions of contemporary capitalism.

Table of Contents

Introduction

Benjamin Lee

Part I

Chapter One The Wealth of Dividuals

Arjun Appadurai, New York University

Chapter Two Ritual in Financial Life

Edward LiPuma, University of Miami

Chapter Three From Primitives to Derivatives

Benjamin Lee, The New School

Part II

Chapter Four Liquidity

Robert Meister, University of California, Santa Cruz

Part III

Chapter Six Remarks on Financial Models

Emanuel Derman, Columbia University

Chapter Seven On Black-Scholes1

Elie Ayache, ITO 33

Chapter Eight Mapping the Trading Desk

Robert Wosnitzer, New York University