Introducing a New Logical Framework for Modelling Reflexivity in Financial Markets

Abstract:     
The vicious positive and negative feedback loops (vicious reflexivities) that occur in all areas of the social sciences have the same structure as the logical paradoxes of the Liar and Anti-Liar, and of the corresponding Russell and Anti-Russell paradoxes in set theory. In recent decades the logical and set-theoretic paradoxes have been resolved within the new field of paraconsistent mathematics. The paper argues that the vicious reflexivity apparent in the social sciences can be resolved by a similar move. An outline of the paraconsistent mathematics framework adequate for the modelling of social science reflexivities is presented and discussed.

Number of Pages in PDF File: 35

Keywords: reflexivity, behavioural finance, evolutionary game theory, paraconsistent set theory

JEL Classification: C00, G10, G14

working papers series