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Jhun, Jennifer; Palacios, Patricia; Weatherall, James Owen (2018): Market crashes as critical phenomena? Explanation, idealization, and universality in econophysics. In: Synthese, Vol. 195, No. 10: pp. 4477-4505
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We study the Johansen-Ledoit-Sornette (JLS) model of financial market crashes (Johansen et al. in Int J The or Appl Financ 3(2): 219-255, 2000). On our view, the JLS model is a curious case from the perspective of the recent philosophy of science literature, as it is naturally construed as a "minimal model" in the sense of Batterman and Rice (Philos Sci 81(3): 349-376, 2014) that nonetheless provides a causal explanation of market crashes, in the sense of Woodward's interventionist account of causation (Woodward in Making things happen: a theory of causal explanation. Oxford University Press, Oxford, 2003).