Emanuel Derman and Paul Wilmott wonder how to get their fellow modelers to give up their fantasy of perfection. In a Business Week article they proposed, not entirely in jest, a model makers' Hippocratic Oath:
- I will remember that I didn't make the world and that it doesn't satisfy my equations.
- Though I will use models boldly to estimate value, I will not be overly impressed by mathematics.
- I will never sacrifice reality for elegance without explaining why I have done so. Nor will I give the people who use my model false comfort about its accuracy. Instead, I will make explicit its assumptions and oversights.
- I understand that my work may have enormous effects on society and the economy, many of them beyond my comprehension.
Maybe it's just me, but the credo sounds a bit self-flattering. If the modelers are indeed trying to give up the fantasy of perfection, they are certainly willing to replace it with the fantasy of self-importance.
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