Academic Finance: Responsible Enquiry or Stamp Collecting?

Abstract

The underlying assumptions and ethos of markets and market behavior as encapsulated and advanced by academic output serve to influence how financial markets are perceived and therefore manipulated by regulatory and supervision authorities. Thus, as well as sustaining individual academic careers and contributing to the prestige of academic institutions, academic finance, for better or for worse, continues to influence financial practice. This paper explores how academic thinking has helped shape how markets are perceived and thereby acted upon in practice.