Study title

The project will research two closely related issues. The first is how the properties of the particular complex financial instruments on which it will focus (which are known as "multi-name credit derivatives") were and are understood. Even the most experienced market participant cannot value such an instrument simply by reading its prospectus. We will examine questions such as how mathematical modelling has developed and how it has been and is used, eg by banks, hedge funds, and the agencies that give multi-name derivatives credit ratings. The second issue to be researched is how these complex financial instruments were and are governed: for example, to what extent has this market developed outwith the control of banking supervisors and other regulators, and to what extent has it been a response to such regulation? The main source will be around eighty semi-structured interviews with traders, managers, modellers, regulators, accountants/auditors, rating agency staff. The research will be a contribution to the emerging field of social studies of finance, in which instead of applying economics to financial markets (the dominant approach), other areas of the social sciences are drawn upon: in this case science and technology studies and politics (especially comparative and international political economy).