This paper argues that the subsistence of the fundamental theorem of contemporary financial mathematics is the ethical concept ‘reciprocity’. The argument is based on identifying an equivalence between the contemporary, and ostensibly ‘value neutral’, Fundamental Theory of Asset Pricing with theories of mathematical probability that emerged in the seventeenth century in the context of the ethical assessment of commercial contracts in a framework of Aristotelian ethics. This observation, the main claim of the paper, is justified on the basis of results (...) from the Ultimatum Game and is analysed within a framework of Pragmatic philosophy. The analysis leads to the explanatory hypothesis that markets are centres of communicative action with reciprocity as a rule of discourse. The purpose of the paper is to reorientate financial economics to emphasise the objectives of cooperation and social cohesion and to this end, we offer specific policy advice. (shrink)

methods that have shown promise for improving extreme risk analysis, particularly for assessing the risks of invasive pests and pathogens associated with international trade. We describe the legally inspired regulatory regime for banks, where these methods have been brought to bear on extreme ‘operational risks’. We argue that an ‘advocacy model’ similar to that used in the Basel II compliance regime for bank operational risks and to a lesser extent in biosecurity import risk analyses is ideal for permitting the diversity (...) of relevant evidence about invasive species to be presented and soundly evaluated. We recommend that the process be enhanced in ways that enable invasion ecology to make more explicit use of the methods found successful.. (shrink)

"Does torture work?" is a factual rather than ethical or legal question. But legal and ethical discussions of torture should be informed by knowledge of the answer to the factual question of the reliability of torture as an interrogation technique. The question as to whether torture works should be asked before that of its legal admissibility—if it is not useful to interrogators, there is no point considering its legality in court.

Fifty years of effort in artificial intelligence (AI) and the formalization of legal reasoning have produced both successes and failures. Considerable success in organizing and displaying evidence and its interrelationships has been accompanied by failure to achieve the original ambition of AI as applied to law: fully automated legal decision-making. The obstacles to formalizing legal reasoning have proved to be the same ones that make the formalization of commonsense reasoning so difficult, and are most evident where legal reasoning has to (...) meld with the vast web of ordinary human knowledge of the world. Underlying many of the problems is the mismatch between the discreteness of symbol manipulation and the continuous nature of imprecise natural language, of degrees of similarity and analogy, and of probabilities. (shrink)

An Aristotelian Philosophy of Mathematics breaks the impasse between Platonist and nominalist views of mathematics. Neither a study of abstract objects nor a mere language or logic, mathematics is a science of real aspects of the world as much as biology is. For the first time, a philosophy of mathematics puts applied mathematics at the centre. Quantitative aspects of the world such as ratios of heights, and structural ones such as symmetry and continuity, are parts of the physical world and (...) are objects of mathematics. Though some mathematical structures such as infinities may be too big to be realized in fact, all of them are capable of being realized. Informed by the author's background in both philosophy and mathematics, but keeping to simple examples, the book shows how infant perception of patterns is extended by visualization and proof to the vast edifice of modern pure and applied mathematical knowledge. (shrink)

Pascal’s Wager does not exist in a Platonic world of possible gods, abstract probabilities and arbitrary payoffs. Real decision-makers, such as Pascal’s “man of the world” of 1660, face a range of religious options they take to be serious, with fixed probabilities grounded in their evidence, and with utilities that are fixed quantities in actual minds. The many ingenious objections to the Wager dreamed up by philosophers do not apply in such a real decision matrix. In the situation Pascal addresses, (...) the Wager is a good bet. In the situation of a modern Western intellectual, the reasoning of the Wager is still powerful, though the range of options and the actions indicated are not the same as in Pascal’s day. (shrink)