Fallibility, reflexivity, and the human uncertainty principle. George Soros*. Soros Fund Management and the Open Society Foundations, New York, NY, USA. When I first read The Alchemy of Finance by George Soros, I thought his “theory of reflexivity” was absurd. It seemed to be an ex post facto. In epistemology, and more specifically, the sociology of knowledge, reflexivity refers to circular . Economic philosopher George Soros, influenced by ideas put forward by his tutor, Karl Popper (), has been an active promoter of the.

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I have no business relationship with any company whose stock is mentioned in this article. It is clear that I ought to get out of the market, but how and when? The flaws may be revealed only after the construct has come into existence. I imagine this book being a lot harder to write for George Soros if he had never done this.

Bourdieu argued that the social scientist is inherently laden with biasesand only by becoming reflexively aware of those biases can the social scientists free themselves from them and aspire to the practice of an objective science.

Cultural traditions are often imagined as perpetuated as stable ideals by uncreative actors. Georgd Read Edit View history. Nonetheless, many anthropologists have accused the “writing cultures” approach of muddying the scientific aspects of anthropology with too much introspection about fieldwork relationships, and reflexive anthropology have been heavily attacked by more positivist anthropologists.

Reflexivity, therefore, raises real issues regarding the extent to which the social sciences may ever be viewed as “hard” sciences analogous to classical physics, and raises questions about the nature of the social sciences. At the peak of the Japanese real estate bubble, the land under the Imperial palace was worth more than the state of California. Georhe used to occur before I knew what was wrong, often even before the fund began to decline in value.

Economist and former columnist of the Financial Times, Anatole Kaletskyargued that Soros’ concept of reflexivity is useful in understanding the way in which Western analysts believe that China’s “economy is not only slowing, but falling off a cliff. Journal of Social Theory.

For Bourdieu, therefore, reflexivity is part of the solution, not the problem. See also structure and agency and social mobility.


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Objectification of people and cultures and analysis of them only as objects of study has been largely rejected in favor of developing more collaborative approaches that respect local people’s values and goals.

Fundamental analysis seeks to establish how underlying values are reflected in stock prices, whereas the theory of reflexivity shows how stock prices can influence underlying values. A low level of reflexivity would result in an individual shaped largely by their environment or ref,exivity. Making our way through the world: They can play with, comment upon, debate, modify, and objectify culture through manipulating many different features in recognized ways.

University of Chicago Press.

Reflexivity (social theory)

The same process can operate in reverse leading to a catastrophic collapse in prices. There is one last piece of advice I have from his book that George says helped him a lot. I find it somewhat embarrassing to get caught in the “bust of our lifetime” while writing about the “boom of our lifetime. In the paper, he has a nice chart with an explanation of it. And when a successful idea or strategy gets copied it becomes harder to succeed if lots of other market participants are copying it.

This rise in domestic demand raises output as producers will produce more to meet the demand.

Any particular field of research occupied with aspects of knowledge processes in general e. Reflexivity is inconsistent with general equilibrium theorywhich stipulates that markets move towards equilibrium and that non-equilibrium fluctuations are merely random noise that will soon be corrected.

Reported Speech and Metapragmatics. George concludes that his theory of reflexivity is best to be used along with fundamental analysis, rather than on its own. Lists Anthropologists by nationality Anthropology by year Bibliography Journals List of indigenous peoples Organizations.

Higher production means higher profits. Higher equity prices implies holding gains capital gains for the holders ultimately households.

Reflexivity (social theory) – Wikipedia

He constantly second guessed himself. The New Paradigm for Financial Markets: The prophecy has a constitutive impact on the outcome or result, changing the outcome from what would otherwise have happened. That is what makes financial markets such a good laboratory for testing your ideas: More broadly, reflexivity is considered to occur when the observations or actions of observers in the social system affect the very situations they are observing, or theory being formulated is disseminated to and affects the behaviour of the individuals or systems the theory is meant to be objectively modelling.


He wrote the book, The Alchemy of Finance, to communicate his theories on the markets and why he had so much success. Sinhalese demons and Tewa clowns. Giddensfor example, noted that constitutive reflexivity is possible in any social system, and that this presents a distinct methodological problem for the social sciences.

By using this site, you agree to the Terms of Use and Privacy Policy. A very simple example when this happens to me is when the room I am working in gets too hot all of a sudden and then my work productivity starts to drop fast. Reflexivity is the theory that a two-way feedback loop exists in which investors’ perceptions affect that environment, which in turn changes investor perceptions. There is little empirical evidence of an equilibrium or even a tendency for prices to move toward an equilibrium.

Flanagan has argued that reflexivity complicates all three of the traditional roles that are typically played by a classical science: Economic philosopher George Sorosinfluenced by ideas put forward by his tutor, Karl Popper[2] has been an active promoter of the relevance of reflexivity to economics, first propounding it publicly in his book The Alchemy of Finance. Human thoughts and emotions are what drive security prices. The first sense of reflexivity in anthropology is part of social science’s more general self-critique in the wake of theories by Michel Foucault and others about the relationship of power and knowledge production.

Eventually a crossover point G is reached when the trend turns down and prices lose their last prop. For her, human reflexivity is a mediating mechanism geoege structural properties, or the individual’s social context, and action, or the individual’s ultimate concerns. He is arguably the best speculator of all time and is very well known for his bets against currencies.