Contingent

The application of highly sophisticated mathematical techniques to finance is now commonplace and is considered also of great practical importance. Mathematical modeling in finance is now very entrenched in investment houses and trading firms and this will only increase in years to come. This book is an excellent overview of mathematical finance and is written for mathematicians who have no background in finance. The book could be read easily by anyone with background in stochastic processes at the level of the author's earlier book "Brownian Motion and Stochastic Calculus". Since it is written for mathematicians, it follows a "definition-theorem-proof" format. However the authors do interject a lot of explanation into the dialog, especially that concerning finance.

Chapter 1 is an overview of a Brownian motion model of financial markets. Financial assets are considered to have prices evolving continuously in time and driven by Brownian motion. They do however g!ive references for models that assume discontinuous asset prices. The authors define a financial market rigorously in terms of (progressively) measurable processes for the risk-free rate, mean rate of return, dividend rate, and volatility. The after a discussion of portfolio, gains, income, and wealth processes, the authors define a notion of a viable market, namely one where there are no arbitrage opportunities. They then define standard and complete financial model and characterize their properties in terms of martingales.

Chapter 2 is a treatment of options pricing theory, with the assumption of a complete standard, financial market. These contingent claims are given a brief historical introduction at the beginning of the chapter. European contigent claims are treated first, followed by a discussion of forward and futures contracts. The Black-Scholes option pricing formula is then derived. American contingent claims are then discussed and defined as an income proc!ess and a settlement process. With the assumption that the discount payoff process is bounded from below and continuous, the value of the American contingent claim is given in terms of the Snell envelope of the payoff process. The discussion illustrates the difficulties in valuing American claims, based as they are on an arbitrary exercise time.

Chapter 3 is a study of a "small" single investor who begins with an initial endowment and invests in a standard complete market. The discussion reads more like one from a book on utility theory and portfolio analysis. Indeed, the Legendre transform of the utility function appears when attempting to mazimize utility from consumption plus expected utility from terminal wealth. The (nonlinear) Hamilton-Jacobi-Bellman equation appears in thes considerations as expected.

In chapter 4, the equilibrium problem is considered. In such a model, security prices are determined by the law of supply and demand. There are a finite !number of agents with utility functions and there are endowment processes. The endowments can be traded via a financial market of stocks and money market funds. The goal of the chapter is to find the equilibrium condition where endowments are consumed and the net supply of securities is zero. The authors give a rigorous proof of the existence and uniqueness of equilibrium. In addition, they give interesting examples of equilibrium markets that can be computed explicitly.

The next chapter is much more involved and studies how to do arbitrage pricing in incomplete markets. Portfolio constraints force the market to be incomplete, and the authors show how buyers and sellers in such a market can calculate the hedging price of a claim in terms of "dual" processes in a family of auxiliary markets. Since this is a constrained optimization problem, one would naturally think Lagrange multipliers would appear, and this is indeed the case, with the dual processes being the analog!ue of Lagrange multipliers. The usual unconstrained problem then is the result of this. Their approach here is extended in the last chapter of the book where the problem of optimal consumption and investment in a constrained financial market is considered. This is specialized to a deterministic case and the dual to the constrained problem satisfies a linear Hamilton-Jacobi-Bellman equation. This duality between the Lagrangian and Hamiltonian points of view is not surprising to the astute reader (and particularly the physicist reader).

The book is challenging. But if you want to do real good work in finance. You must read it.

Sylwanowicz presents compelling arguments that the key concepts of Duns Scotus' metaphysics derive from a common metaphysical inspiration: that essence is by nature self-moving. He contrasts this with the Thomistic inspiration: essence as the passive recipient of an act of existence which it delimits. One comes away from the work with an appreciation of the unique genius of Scotus, an increased capacity to view Scotistic metaphysics from within, rather than through the lens of another system. This is achieved with a minimum of polemical attitude toward Aquinas and ought to be welcomed by all, regardless of philosophical formation. Neither is the analysis for historians of philosophy alone. A reading of this book can only have salutary consequences for anyone who actively considers these issues on their own. Expect to be challenged but to come away enriched.

Virginia Brackett has successfully shown why personal criticism is a form of criticism that the academic world should embrace. Commercial writers (those who want substantial dollars for their work) have long known that a novel must have a take-away that a reader can apply to his/her own life if the novel is to be of any value. In a conversational tone, Brackett shows how literary works have impacted her life, weaving personal stories of divorce, custody battle, the death of her mother, her quest for education, and her professional writings with critical studies. She has also shown how her life experiences have changed the way she views literary works and broadened her understanding. As Brackett's life journey changed directions, feminist issues gained importance, and in this volume she views gender roles in literature and in reality.

This book is a must for any graduate program in Economics. The authors show how the state-contingent approach can be extended to production problems breaking the path for a unified duality theory under uncertainty. They also show that agency theory does not need to be inacessible for someone who does not care much about probability theory. Bravo!

It have everything you need to learn about contingent valuation, an sophisticated and controversial method to value public goods.

This book is one more in the long line of books that takes an author's training in a field of science or engineering and then tries to export it wholesale into understanding the markets. I've seen it done with engineers using the principles of signal processing and torque, physicists using -- believe it or not -- general relativity, so I guess I should not be surprised someone would pull out the really big guns of modern physics. It may be fun for the author's fellow physicists, but speaking as a finance professional with a Ph.D. and nearly twenty years on Wall Street, there are a lot of other places I would be going to understand and implement contingent claim theory before I would invest the time or money in this book.

Although I am not specialized in the field of financial analysis, I believe that it is important and useful to quantitatively describe financial phenomena. Therefore, this new theory and new method will certainly contribute to the establishment of a standard model of financial analysis. I hope the publication of this book will help people to understand, improve and apply the theory, introduced from modern theoretical physics by the author, for practical application in financial analysis.

The recognition of patterns in natural systems is the most significant step towards the full understanding of the dynamics of such systems. In the context of financial markets, the degree to which one appreciates these dynamics is the degree to which one is profitable. Beliefs-Preferences Gauge Symmetry Group and Replication of Contingent Claims in a General Market Environment not only identifies the key concepts in the understanding of the financial markets, but also lays out a rich display of tools and applications with which to analyze financial phenomena.

From the book's outset, the emphasis is on the role and formulation of mathematical symmetries, which govern the evolution of quantities such as derivative payoffs or prices in the marketplace. The key concept is summarized in the words of the author when he conjectures that, "the absence of some type of arbitrage opportunity in the marketplace indicates the presence of a certain inherent symmetry." From this powerful observation, he proceeds to formulate the active degrees of freedom in the market (i.e. the market participants) and the symmetric implications of this statement. The identification of arbitrage opportunities, that is, the practical application of this observation, comes straight from basing oneself in this non-varying quality of the market and seeing where deviations exist. As such, Dr. Kholodnyi's book is a gift to financial practitioners. Only when one knows what the market should be doing can one appreciate the instances when the market is behaving in an unusual fashion.

Considered in a wider sense, the tools laid out in this text demonstrate the power of the symmetry principle. Physicists have long been accustomed to using gauged symmetries in the analysis of high-energy phenomena. By using the same techniques to understand an area as applied as the financial markets, Beliefs-Preferences Gauge Symmetry Group and Replication of Contingent Claims in a General Market Environment heralds the dawn of potential new technologies for such disparate areas of science as quantum mechanics and biological systems.

As these techniques mature in the sense of becoming widely available financial tools, Dr. Kholodnyi's book will become the standard text for a rigorous analysis of financial phenomena. The text requires a strong mathematical background and some familiarity with mathematical rigor. However, since rigor leads to reliability, the viability of any financial strategies will ultimately depend on the understanding of the tools laid out so cleanly in this text.

Extenisve research, could have been more inclusive with contingent work section. If you want to read about a temp turned activist (she testified in the U.S.Senate Labor Committee June 1993) read Temporarily Yours by Wendy Perkins, a revealing expose of the temp industry as portrayed by this Beverly Hills temp worker.

This volume culminates a five year project working with the top scholars on contingent work in the United States. Every form of contingent work is considered in depth by knowledgeable experts, from independent contracting to temporary arrangements, from service industries to higher education. The result, in our estimation, is a thought-provoking and timely review of how particular American workers are faring.

Reviewers have commented:

"Barker and Christensen bring together an outstanding collection on the transformation of American employment. This iterdisciplinary volume provides the theoretical, historical, and legal contexts for understanding the eremergence of contingent work, and offers empirical research on its extent and its consequences for workes and their families. This volume will be useful for scholars and students interested in work in America; it is a must for policy-makers, unions, and personnel specialists." (Barbara Reskin, Harvard University)

and "This book does a simply masterful job of helping us understand contingent work arrangements..." (Jeffrey Pfeffer, Stanford University

Finite, Contingent, and Free: A New Ethics of Acceptance by Joyce Kloc McClure (Rowman & Littlefield) This book seeks to develop a new approach to ethics that is grounded in our experience as finite, contingent, and free and is consonant with a Christian understanding of what it is to be human and to be obligated to ourselves and others. A few words on the book's methodology are in order. The turn to finitude and contingency as fundamental conditions of existence, as well as the focus on the issue of human freedom, are features that reflect the author's commitment to approach ethics from what is best de-scribed as a Roman Catholic point of view. That is to say, it is deeply in-formed by Roman Catholicism's embrace of turning to nature and reason to make its case, from a perspective that is profoundly and foundationally shaped by the Christian story as told in the New Testament and by the Christian hope for humankind and redemption more generally. As such, it is a project that is meant to be open and persuasive to Christians and non-Christians alike, although the articulation of religious acceptance in the final chapter will of course resonate more with Christians.
But more is at stake than a specific point of view, however important that may be. The methodology itself was also chosen to help make progress beyond three perplexing difficulties for theologians and philosophers today, including the religious ethicist. The first is the problem of justifying any type of claim about what it is to be a human being that does not violate the particularity of each human being. Compounding this has been a problem especially relevant to the ethicist: the difficulty of making a case for the existence of human freedom, where the entire discipline in some way engages or depends on the need for human beings to make choices, and evaluate their choices, in the context of their lives. The long-standing and all-dominating view of the world as it is leaves little room for a theoretical grounding of freedom, and so philosophers and theologians alike have taken a variety of tacks to try to assume, evade, make compatible, or soften the significance of human freedom vis-à-vis determinism.
The description of finitude and contingency in the first chapter seeks to ad-dress the first problem, that of saying something about what it is to be human that is universally true to a practical extent without violating particularity.
The description in chapter 1 identifies finitude and contingency as conditions that are fundamental for human existence and therefore common to all, but since it is our finitude and contingency that give rise to our particularity, these conditions of existence seem good candidates for articulating what is universal while respecting what is particular.
The second problem is taken up in light of the answer to the first. That is, the very fact that our finitude and contingency create particular lives, lives that encounter particular choices, requires that the question of freedom be addressed. Because chapter 2 offers a new, more scientifically sound account than mechanistic determinism as an overarching view with room for freedom-a view, moreover, that also gains support from the very considerations of finitude and contingency explored in chapter 1-we may begin to think again about human persons as substantively free in a real sense. This means that we no longer need to restrict ourselves, theoretically at least, to thinking of human persons only `as if' they were free, or to constructing models for considering freedom in nonsubstantive ways. Yet if this makes it possible to speak of human persons as possessing some degree of freedom, it does so with the implication that freedom is had in a context where finitude and contingency profoundly shape our lives. This approach also recognizes that it is not possible to speak of human persons as free in an absolute sense. Freedom, to the extent that it exists, can be only a matter of degree.
Making some progress on these two fronts, however, could leave us with a third problem, one common to an endeavor of this kind: abstraction. Having worked on the topics of finitude, contingency, and freedom for some time, the author is keenly aware of how easily abstract wanderings can bedevil such considerations. However, the methodology that risks creating this problem is also its antidote. Finitude and contingency are taken up precisely because these are features of concrete existence, and the issue of freedom must then be considered because it arises directly in relation to them. These features literally confront us as we live. Moreover, the decision to turn to literary analysis from an ethical point of view reflects not just a turn to a source of deep reflection and a presentation of experience, but also a commitment to keep the ethical analysis grounded, that is, consonant with the conditions of particular lives, the conditions under which all ethical action occurs.
This book seeks to move beyond the three problems noted above and clear the way for the development of a fruitful new approach that is philosophically sound, consistent with key Christian understandings, and productive of a concrete ethics that arises from a conception of the human person as finite, contingent, and free. The final chapter offers a specific approach to ethics that can assist us in understanding morality anew and in discerning how we are to act if we are indeed finite, contingent, and free. Admittedly, seeking to develop a way of understanding that avoids the three problems noted above and generates a new approach to ethics is an ambitious agenda. But the book is in-tended as a beginning, as a new way of asking questions about ethics, not as the answer to the ongoing ethical questions that life poses for us.

In this 1998 book, Dr. Eileen Schell takes on the problem of "contingent labor" in higher education; that is, work that is part-time, adjunct and non tenure-track. Schell asks: why are so many of these dead-end jobs going to women? And why do so many of these women wind up teaching Freshman composition courses? To observers of employment trends in colleges in the 90s, the trend toward "two-tier" employment is obvious and troubling. While academics in fields with a high market value in the business world can ask for and receive salaries and job enhancements that are competitive, English, Humanities, and Language Arts faculty find themselves competing for very few jobs. Many are forced to decide after years of part-time work that they will never become fully employed at the college level. They drop out, to take jobs in industry, especially technical writing, or to find other work altogether. But the space they leave is filled with young hopefuls almost before anyone notices. In my work as a Division Chair at a California community college, the part-time roster of English department faculty lost about 25% of its names every year. We were constantly hiring newly minted graduate students who would burn out within a few years as their dream of full-time employment faded. Gypsy Academics takes a look at the myths about part-time teachers that prevent Higher Education management from bringing equity into their hiring practices. Schell explores the dynamics of the dialogue between full-time, tenured faculty and their part-time colleagues, documenting failures of professionalism. Her final chapter asks: What can we do? As a participant-observer, Schell has provided a valuable analysis of the use and abuse of women in maintaining college-level writing instruction programs. Documentation for her observations runs nearly to twenty pages. For part-time faculty, becoming increasingly politicized, and for those seeking a comprehensive look at gender politics for women in higher education, this book is an excellent resource.

Enron, Worldcom, Global Crossing and others have driven home the need to consider corporate securities as contingent claims. The important issues of equity value and credit risk are hot topics in today's markets.

Great job on an excellent general overview of derivatives. I enjoyed the treatment of exotic options in particular. The style is clear and classic.