Abstract: We identify two distinct cultures that take the study of the capital markets as their common specialism, namely, that of market practitioners and that of academic financial economists. The cultures differ in all that defines a culture: their value system. Accordingly, each has a distinct body of knowledge that evolves by a different selection process. We ask: what is the market’s valuation of financial economics? It is shown that actuarial science had evaluated all the significant advances in financial economics almost as soon as they were made – sometimes even before they were made by financial economists. It is claimed that actuaries ’ evaluation of financial economics, given their market consistent value system, can be identified with the market’s valuation. The key insights of financial economics from 1900 are evaluated. We conclude that if models in financial economics are to be judged solely by the accuracy of the predicted outcomes then the models developed to date are not fit-for-purpose
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