Performativity in Science. The Rise and Fall of the Black-Scholes Model

The Black-Scholes model provides a nice case study of performativity in financial markets. Performativity, as a notion, refers to how economic models and theories can shape the markets they aim to describe, influencing behavior and, in turn, the dynamics of the market itself. This post will discuss the rise and fall of the Black-Scholes model, […]