Stochastic Calculus with Infinitesimals (Lecture Notes in Mathematics, 2067)

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Stochastic Calculus with Infinitesimals (Lecture Notes in Mathematics, 2067) image
ISBN-10:

3642331483

ISBN-13:

9783642331480

Edition: 2013
Released: Nov 07, 2012
Publisher: Springer
Format: Paperback, 130 pages

Description:

Stochastic analysis is not only a thriving area of pure mathematics with intriguing connections to partial differential equations and differential geometry. It also has numerous applications in the natural and social sciences (for instance in financial mathematics or theoretical quantum mechanics) and therefore appears in physics and economics curricula as well. However, existing approaches to stochastic analysis either presuppose various concepts from measure theory and functional analysis or lack full mathematical rigour. This short book proposes to solve the dilemma: By adopting E. Nelson's "radically elementary" theory of continuous-time stochastic processes, it is based on a demonstrably consistent use of infinitesimals and thus permits a radically simplified, yet perfectly rigorous approach to stochastic calculus and its fascinating applications, some of which (notably the Black-Scholes theory of option pricing and the Feynman path integral) are also discussed in the book.

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