Study on the Paradigm Shift in Marketing Derivatives

A derivative is a type of a financial instrument, whose value is derived from underlying assets. These underlying assets can be equities, interest rates, currencies and commodities. The general practice is to use derivatives as a risk management tool that allows an investor to transfer the risks attached with the underlying asset to the party who is willing to take it. There can be a number of risks such as market risks, credit risk and liquidity risk. While the term -paradigm‖ has been around for a long time, the wide acceptance and usage of the concept in the marketing literature is mainly fueled by Kuhn‟s (1962) seminal work The Structure of Scientific Revolutions (Deshpande 1983). The Kuhnian definitions of paradigm‖ generally refer to three postulates: paradigms as a complete view of reality or way of seeing, as relating to the social organization of science in terms of different schools of thought, and as relating to the specific use of instruments in the process of scientific puzzle solving‖ (Arndt 1985, p. 15). Most scholars, including authors of this study, use the term in the first sense. In the following discussion, the words paradigm and worldview‖ are used interchangeably. The latest paradigm debate in marketing was ignited by dissatisfaction with the dominant goods-centered, transaction-based marketing model, and the concern that academic thinking lags behind real-world development (Lusch and Vargo 2006). Although scholars involved in this debate may take the risk of being academically imprudent and theoretically superficial, or even fragmentizing or oversimplifying marketing studies (Vargo and Lush 2004a), such efforts are considered healthy to the growth of a discipline (Brown, 2004). Granted, sometimes the term paradigm‖ has been misinterpreted and misused in these debates. However, to be true to what has been used, this study employs the term paradigm‖ when necessary, rather than nitpicking the semantic nuance.