Inside Technology Series

In An Engine, Not a Camera, Donald MacKenzie argues that the emergence of modern economic theories of finance affected financial markets in fundamental ways. These new, Nobel Prize-winning theories, based on elegant mathematical models of markets, were not simply external analyses but intrinsic parts of economic processes. Paraphrasing Milton Friedman, MacKenzie says that economic models are an engine of inquiry rather than a camera to reproduce empirical facts. More than that, the emergence of an authoritative theory of financial markets altered those markets fundamentally. For example, in 1970, there was almost no trading in financial derivatives such as "futures." By June of 2004, derivatives contracts totaling $273 trillion were outstanding worldwide. MacKenzie suggests that this growth could never have happened without the development of theories that gave derivatives legitimacy and explained their complexities. MacKenzie examines the role played by finance theory in the two most serious crises to hit the world's financial markets in recent years: the stock market crash of 1987 and the market turmoil that engulfed the hedge fund Long-Term Capital Management in 1998.
He also looks at finance theory that is somewhat beyond the mainstream -- chaos theorist Benoit Mandelbrot's model of "wild" randomness. MacKenzie's pioneering work in the social studies of finance will interest anyone who wants to understand how America's financial markets have grown into their current form.

Mechanizing Proof

by Donald MacKenzie

Published 1 October 2001

Most aspects of our private and social lives—our safety, the integrity of the financial system, the functioning of utilities and other services, and national security—now depend on computing. But how can we know that this computing is trustworthy? In Mechanizing Proof, Donald MacKenzie addresses this key issue by investigating the interrelations of computing, risk, and mathematical proof over the last half century from the perspectives of history and sociology. His discussion draws on the technical literature of computer science and artificial intelligence and on extensive interviews with participants.

MacKenzie argues that our culture now contains two ideals of proof: proof as traditionally conducted by human mathematicians, and formal, mechanized proof. He describes the systems constructed by those committed to the latter ideal and the many questions those systems raise about the nature of proof. He looks at the primary social influence on the development of automated proof—the need to predict the behavior of the computer systems upon which human life and security depend—and explores the involvement of powerful organizations such as the National Security Agency. He concludes that in mechanizing proof, and in pursuing dependable computer systems, we do not obviate the need for trust in our collective human judgment.

Inventing Accuracy

by Donald MacKenzie

Published 13 December 1990

"Mackenzie has achieved a masterful synthesis of engrossing narrative, imaginative concepts, historical perspective, and social concern."

Donald MacKenzie follows one line of technology—strategic ballistic missile guidance through a succession of weapons systems to reveal the workings of a world that is neither awesome nor unstoppable. He uncovers the parameters, the pressures, and the politics that make up the complex social construction of an equally complex technology.

Knowing Machines

by Donald MacKenzie

Published 2 January 1996

Ranging from broad inquiries into the roles of economics and sociology in the explanation of technolgical change to an argument for the possibility of "uninventing" nuclear weapons, this selection of Donald MacKenzie's essays provides an introduction to the style and the substance of the sociology of technology. The essays are tied together by their exploration of connections (primarily among technology, society and knowledge) and by their general focus on modern "high" technology. They also share an emphasis on the complexity of technological formation and fixation and on the role of belief (especially self-validating belief) in technological change. Two of the articles won major prizes on their original journal publication, and all but one date from 1991 or later. A substantial new introduction outlines the common themes underlying this body of work and places it in the context of recent debates in technology studies.
Two conceptual essays are followed by seven empirical essays focusing on the laser gyroscopes that are central to modern aricraft navigation technology, supercomputers (with a particular emphasis on their use in the design of nuclear weapons), the application of mathematical proof in the design of computer systems, computer-related accidental deaths, and the nature of the knowledge that is needed to design a nuclear bomb.