 On the epistemic contribution of financial modelsAlexander Mebius Journal of Economic Methodology, 2023, vol. 30, issue 1, 49-62 Abstract: Financial modelling is an essential tool for studying the possibility of financial transactions. This paper argues that financial models are conventional tools widely used in formulating and establishing possibility claims about a prospective investment transaction, from a set of governing possibility assumptions. What is distinctive about financial models is that they articulate how a transaction possibly could occur in a non-actual investment scenario given a limited base of possibility conditions assumed in the model. For this reason, it is argued that the epistemic contribution of financial models is that of enabling the model users to envision exactly how a prospective investment could be achieved in various ways through a detailed understanding of the available transaction mechanisms. Thus, financial models provide information about the possibility of an investment scenario by showing how a specific transaction mechanism could result from a small set of initial possibility conditions assumed in the model. Date: 2023 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:jecmet:v:30:y:2023:i:1:p:49-62 Ordering information: This journal article can be ordered from DOI: 10.1080/1350178X.2023.2172447 Access Statistics for this article Journal of Economic Methodology is currently edited by John Davis and D Wade Hands More articles in Journal of Economic Methodology from Taylor & Francis Journals |
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