By the 1980s, the time lag between development of academic theory and its application was nil! Today, it is even faster. How can I make such an absurd remark? Today much of the leading edge work is occurring in commercial organisations. Markowitz has a long association with Daiwa; Sharpe consults; Black was a partner in a leading US investment bank; and Scholes, a partner in one of its competitors. Locally, the committee of the Q-Group (a practitioner group) is replete with PhDs in number theory, quantum relativity, control theory, etc. from places ranging from Cambridge to Stanford. Throughout the world, some of the best brains are in full time research positions in financial institutions.
Not only has mathematics changed the face of finance, but the practice of finance has changed mathematical research. One consequence of this is a lack of publication of leading-edge work, or at least its delay until its money-making potential has passed.
The nature of theoretical disputes has also changed. In the last two columns of Imre Salusinszky's article ``Academic squabbles are feud for thought''[ 10], recounts how Bertrand Russell, after continual interjection during a Cambridge lecture by Ludwig Wittgenstein ``dragged him across the floor to the exit, and slammed the door on his head several times. `There were no further disputations...', noted Russell in his diary that night.'' In the financial community, we would use a few hundred million dollar arbitrage to make a profit at his expense, and then not even tell him (in case he worked out how we had done it).