Thinking outside the Box to Get inside the Black Box: Alternative Epistemology for Dealing with Financial Innovation

Marta Gasparin; Christophe Schinckus; William Green

doi:10.1080/02691728.2019.1601290

Thinking outside the Box to Get inside the Black Box: Alternative Epistemology for Dealing with Financial Innovation

Marta Gasparin, Christophe Schinckus^*, William Green

^*Corresponding author for this work

Management

Research output: Contribution to journal › Article › peer-review

2 Citations (Scopus)

Abstract

This paper seeks to ignite debate surrounding the computerization and change in organizing financial markets and, due to the emergence of trading algorithms, investigates those as disruptive innovation and its side effects. First, we frame the computerization of financial markets as disruptive innovation. Second, we analyze how an extension of a disruptive innovation generates latent effects that contradict the original principles. Third, we argue the necessity to explicitly consider the epistemological nature of financial innovations. This leads to our conclusion that there is a necessity to extend the epistemological dimension of financial innovation, in order to think outside the box to get inside the black box of financial innovation.

Original language	English
Pages (from-to)	218-233
Number of pages	16
Journal	Social Epistemology
Volume	33
Issue number	3
DOIs	https://doi.org/10.1080/02691728.2019.1601290
Publication status	Published - 4 May 2019

Bibliographical note

Funding Information:
Dr William Green is the Director of Research Impact and Knowledge Exchange for the College of Social Sciences, Arts and Humanities, and Associate Professor of Innovation, Operations and Knowledge Management in the University of Leicester School of Business. He studies design and innovation management, and the role of new technology on the interface between people, technology and their environment. This research has led to recent studies of innovation and technology adoption in the healthcare and consumer research sectors, investigating the impact of new technology on practice for both the worker and consumer or patient. Will has received over one million pounds of research funding, from a range of research funders including Marie Skłodowska Curie, Technology Strategy Board, National Health Service and the private sector. His research in the creative industries and healthcare sectors has been nominated and won awards in relation to innovation. He has published in a number of leading marketing, management and innovation journals.

Publisher Copyright:
© 2019, © 2019 Informa UK Limited, trading as Taylor & Francis Group.

Keywords

Black box
disruptive innovation
epistemology
financial innovation
financial markets
flash crashes

ASJC Scopus subject areas

Philosophy
General Social Sciences

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10.1080/02691728.2019.1601290

Cite this

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abstract = "This paper seeks to ignite debate surrounding the computerization and change in organizing financial markets and, due to the emergence of trading algorithms, investigates those as disruptive innovation and its side effects. First, we frame the computerization of financial markets as disruptive innovation. Second, we analyze how an extension of a disruptive innovation generates latent effects that contradict the original principles. Third, we argue the necessity to explicitly consider the epistemological nature of financial innovations. This leads to our conclusion that there is a necessity to extend the epistemological dimension of financial innovation, in order to think outside the box to get inside the black box of financial innovation.",

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Thinking outside the Box to Get inside the Black Box: Alternative Epistemology for Dealing with Financial Innovation

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

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