1st Edition
New Paradigms in Financial Economics How Would Keynes Reconstruct Economics?
List of figures
List of tables
Preface
List of abbreviations and acronyms
1 Introduction
2 Irrational foundations of ‘rational’ behaviour in the standard paradigm
2.1 Foundation of ‘rational’ individuals’ behaviour
2.2 Foundation of ‘rational’ pricing theory
2.3 Use and abuse of mathematics in economics and finance
3 Contradictions of the Marxian paradigm
4 The new paradigm
4.1 Common ground with existing literature
4.2 Our assumptions on economic behaviour, friction and liquidity
4.3 Fundamental assumption of the new paradigm and its implications
4.4 Role of money, reason for its existence and its time-value
4.5 Multi-pricing in efficient, frictionless and competitive markets
5 Resolution of puzzles in microeconomics
5.1 Puzzles of theory
5.2 Puzzles from experience and experiments
6 Resolution of puzzles in finance
6.1 Capital structure and debt-capacity
6.2 Dividend policy and excess volatility of share prices
6.3 Corporate control premium, discount to full net asset value and winner’s curse
6.4 Alternatives to Markowitz’s portfolio theory
6.5 Foundations of the accounting ‘identity’
7 Resolution of puzzles in macroeconomics
7.1 The new macroeconomic model of the economy
7.2 Reasons for the emergence of endogenous imbalances
7.3 Banks in the new model
7.4 Reasons for the emergence of endogenous macroeconomic swings
7.5 Pricing of risk during imbalances
7.6 Consequences of Central Bank decisions
7.7 Uneven economic development within the same economy
8 Economic role of the State
9 The recent global financial crisis
9.1 Excessive loan growth scenario and its aftermath
9.2 International dimensions of the recent global financial crisis
9.3 Authorities’ handling of the early signs of the crisis
9.4 Authorities’ handling of the crisis and its aftermath
9.5 Minimizing further damage from the crisis in the Euro-zone
10 Conclusion, policy and research recommendations
10.1 Conclusion
10.2 Policy recommendations
10.3 Future research
Appendix 1 A review of some of the academically more popular paradigms Appendix 2 A review of some of the academically less popular paradigms Appendix 3 Existing literature on resolution of puzzles in corporate finance
List of commentators
List of institutions
Bibliography
Index
Biography
Kazem Falahati is currently teaching International Financial Management at Glasgow Caledonian University, UK. He is an accountant-cum-economist by professional training. His experience includes senior managerial positions in both the financial and non-financial industries. He has advised major multinationals and financial institutions on their strategic investments and divestments as well as their financial structure, reporting and control with huge beneficial impact to their stakeholders.
