Something new: value and change in finance*

ABSTRACT

Ethnographic and social scientific accounts of the financiers that buy and sell companies for profit often homogenize the players in these social dramas, relying on blunt, totalizing definitions of culture or overly deterministic articulations of habitus. This article, drawing on a two-year study of private equity investors, offers an alternative analytic frame for making sense of how private equity people buy and sell companies. It explores the ways in which private equity people make arguments persuading one another and the larger public that an investment is worth making. Important to these arguments are not only substantive content, the evidence that investors marshal to support a thesis, but also reflective evaluation of what counts as good evidence, meta-commentary. It is in these split levels of analysis that we can appreciate the cultural diversity within finance, Wall Street, and investment banking. I will also suggest that understanding how investors are arguing substantively as well as meta-pragmatically begins to outline a useful theory of culture change within the world of investment banking.     

Shadow banking: a story of the Doppelgänger (the Double) in science of finance

ABSTRACT

After the 2007 financial crisis central bank economists in the US produced a map of shadow banking system, a fragile interconnectedness of regulated and unregulated financial institutions, to explain why the crisis had happened. This piece of cartographic work in banking regulation had two aims: (a) to represent the economic reality, including the parts that were not in regulatory sight, with full realism and (b) to develop a regulatory surveillance regime to monitor shadow banking to prevent future crises. This paper problematises the first aim as a peculiar cognitive response to the knowledge crisis of economics which challenges the consensus on modern finance as post-modern Baudrilliardian simulacra. The paper then introduces a cultural economy perspective to explore the regulatory fear in the second aim of the shadow banking analysis with references to the theme of the Doppelgänger (the Double) in the genre of horror stories. Finally the societal consequences of the control oriented epistemological choices of the shadow banking analysis are problematised by using Michel Serres concepts of foedera natura versus foedera fati.     

University and Business Relations: Connecting the Knowledge Economy

It is commonplace to say that the modern economy is knowledge based but a moment’s reflection points to the vacuity of this notion. For all economies are knowledge based and could not be otherwise. The question is rather how is one kind of knowledge based economy to be distinguished from another? This essay proposes that the answer may lie in three directions: (1) in terms of the variety of knowledge that is engaged; (2) in terms of the processes by which the production of knowledge is organised, and its corollary the resources devoted to knowledge production and dissemination; and, (3) in terms of the purposes to which knowledge is put. In respect of each of these dimensions, the rise of the modern university as a custodian of knowledge in Western economy and society has been of central importance; but universities are not alone in this role, a wide range of other agencies, private firms, public research laboratories for instance play an important role in defining a knowledge economy and have done so increasingly since the turn of the nineteenth century—a first indication of the systemic dimensions of a modern knowledge economy.     

Financing the culture in Italy

The paper deals with financing the culture in Italy. The public expenses for the culture are shared as expenses of the government, of the regions, of the provinces and of the municipalities. The relationships of the cultural organisations with the public sector are very strong because they belong to the public sector, or they broadly depend on public funds.A specific attention is devoted to other forms of financing, about the role of the entrance fees and the entrances of the game “Lotto”, which subsidy the cultural goods and the Interministerial Committee for the Economic Planning (CIPE) allocations to the depressed areas. We will also be faced up to the examination of other sources of private financing as the sponsorships, the entrances of collateral services about museum visits (coffee and bookstore) and the supply of banking foundations. The fiscal incentives refer directly to the cultural institution or to the external financing of the nonprofit institutions by donations or sponsorships. Finally, the cultural institutions will have always to operate more and more by a strategic vision of financial and managerial field, on the basis of high qualitative standards. The activities and cultural projects will have to be able to attract additional sources of income in addition to the public one; the search of private financial resources is developed in a situation of increasing competition among the institutions, while tools of innovative finance have to be used to satisfy the increasing demand of culture. It is difficult nevertheless to define the possible best method of public–private financing, if you take consideration of the distinctive features of the different institutions and interests of the operators who are involved: artists, cultural institutions, public bureaucracy, besides the economic effects which follow alternative choices. The recent evolution of the institutional, financial and managerial models of the culture in Italy plans a larger integration between public and private sectors for a great involvement of individuals, enterprises and foundations about the financing of the cultural services offer.     

Balancing the score: the financial impact of resource dependence on symphony orchestras

Expenses in the performing arts have historically increased at a rate faster than earned revenues due to the labour reliance of the sector. Flanagan (The perilous life of symphony orchestras: artistic triumphs and economic challenges. Yale University Press, New York, 2012) found that US symphony orchestras were able to avoid the negative consequences of this earning gap by fostering strong private support. In the present study, we find that, in contexts where private funding is not as readily accessible, like in Canada, arts organizations have more incentive to keep expenses under control. This can be understood in terms of resource dependence where government funding bodies, due to a homogeneous set of demands, put pressure on organizations to control their expenses and reach greater audiences. Using panel data covering a period of 8 years and forty-eight orchestras, the results show that Canadian orchestras, when compared to US ones, achieve a lower rate of expense increases over time and are more reactive to economic downturns.     

Fat Capital

Within the domain of breast reconstruction, abject fat has become a form of biovalue to be harnessed, harvested, and remediated through fat transfer, fat grafting, the therapeutic use of fat stem cells, and fat banking. Each of these technologies deploys fat as capital and promises to return corporeal wholeness following breast cancer surgery. This paper explores the supposed endless malleability of fat and the Promethean dream it represents. In the context of these technologies, the paper asks under what conditions can fat become biovalue; what new corporeal economies are created through the labor of fat; how is this form of biovalue inextricable from the vast circuitry of the breast cancer industry; and how do broader patterns of social dispossession delimit who has access to this dream? It becomes evident that fat gets to be revalued and remediated by women already privileged within circuits of capital, demarcations along lines of race, and notions of normative embodiment. Ultimately, it is the ideal neoliberal subject – one who is ‘able’ to assume responsibility for her own health – that is the inheritor of this dream.     

The separation of economy and sentiment: a comparison of how individuals perceive hostile worlds

ABSTRACT

Analyses of the relationship between economy and sentiment tend to focus on connection rather than separation. Scholars recognize that individuals sometimes identify moral conflicts between economy and sentiment, but primarily focus their research on the boundary or relational work performed to mitigate or disappear the conflict. Instead, I analyze how individuals talk about the relationship between economy and sentiment as separate or hostile, comparing two theoretically distinct groups: non-religious individuals and practicing evangelicals. The comparison allows me to analyze patterns of discourse and boundary-making based on access to institutionalized culture. I find that both groups articulate perceptions of hostile worlds by: (1) maintaining the taboo against talking about money, (2) recommending neutral separation, and (3) demarcating areas of life as too sacred for money. Through comparison, I find that non-religious respondents describe a less permeable vertical boundary line, whereby economy and sentiment are separated into separate spheres, as if side-by-side, while evangelicals describe a more permeable horizontal boundary line, where separation is maintained through the use of consistent hierarchical discourses that assert the moral importance of sentiment over economy. My findings underscore how unequal access to cultural schema differentially shape how individuals connect economy and sentiment, if at all.     

Simulating the Ethical Community: Interactive Game Media and Engaging Human Rights Claims

Abstract

This paper examines the external bystander’s (un)ethical engagement with the suffering of distant others in the brave new world of the 21st century, where, thanks to the growth of information technologies, we are all daily spectators and bystanders of human atrocity. In a recent turn, humanitarian movements have sought to incite their audiences to action through the use of simulation and new game media – the last few years have seen a surge of ‘serious games’ such as Darfur is Dying and Sim Sweatshop, as well as the creation in online community Second Life of simulated refugee camps and political protests. The paper draws on the post‐modern theories of Jean Baudrillard and Slavoj ?i?ek, as well as the ethical philosophies of Michael Ignatieff, Stanley Cohen and Avishai Margalit, to expose the limitations of this move, arguing that interactivity and public remembering via online simulations are more properly aligned, in the real world, to interpassivity and ethical amnesia than to the forging of an effective ethical community of human beings.     

The Future of Innovation Studies in Less Economically Developed Countries

In this paper, we argue that there are patterns of innovation occurring in less economically developed countries (LEDCs) that have been historically overlooked by the innovation studies literature, including the literature on innovation systems and the triple helix. This paper briefly surveys cases in agriculture, banking, biomedicine and information and communications technologies that demonstrate organizational, scientific and technological innovation in Africa, South Asia, and Brazil. In particular, we track new developments in two distinctive patterns within LEDCs: (1) civil society as a site of innovation and; (2) innovation through appropriation. By systematically uncovering patterns of innovation in LEDCs, science and technology policy scholars may make new theoretical gains in innovation studies that can potentially contribute to innovation policies in the global South.     

Neither Public Nor Private: The Hybridization of Museums

This paper takes a preliminary look at the hybridization of museums – the creation of a variety of mixed forms of governance incorporating both public and private governing authorities. Using data from three national surveys of American museums, the analysis documents the mix of types of governing authority and demonstrates how this mix varies across location, over time, and by museum type. The paper then estimates the extent of hybridization using several different indicators and speculates about its implications. The United States offers a particularly informative case because the general view is that American museums are (1) either public or private and (2) predominately private. While the second part of this view may still be a useful characterization of American museums, the first is no longer a particularly helpful way of understanding American museums, or, by extension, other cultural institutions, American or not. It is increasingly necessary to view cultural institutions through the lens of hybridization rather than privatization in order to improve our ability to document and predict their institutional behavior.     

Reassembling the Cultural

The central argument in this paper is that actor-network theory (ANT) does not do ‘cultural economy’ symmetrically: it has had a lot to say about economy but much less to say about culture. This rejection of culture is ontological and epistemological: culture appears in ANT largely as an artefact of modernist thought rather than as an empirical aspect of agents' performances. And yet if ‘economy’ can be critiqued and reinstated as performative, so too can ‘culture’. To explore this, we focus on objects of concern that – unlike the financial markets that have formed the core of ANT-inspired thinking about the economy – are assembled by actors in and through what they themselves understand to be cultural materials, cultural calculations, cultural processes, cultural institutions. In such examples, ‘culture’ is continuously invoked and enacted by actors in constructing their actions, whatever critical sociologists might have to say about its ontological status. It seems paradoxical that a theoretical approach that makes sacrosanct the associations constructed by agents who assemble their own world, generally discusses ‘culture’ only from the point of view of critical epistemology. Bearing all this in mind, we argue that it is time for us to ‘reassemble’ the cultural.     

Optimal pricing and grant policies for museums

The “free access” policy designed by the British Government has encouraged interest in museum financial issues. We define a principal-agent model for museum administration where there are two income sources: public grants and ticket revenues. This model allows us to define the optimal contract determining public grants, ticket prices, budget and managerial effort. We find a theoretical explanation for the inelastic pricing strategy commonly adopted in cultural economics. We further find that museum manager should never have any control over the price of tickets. The model can also be applied to other institutions, such as schools or NGOs, which are able to raise funds directly from private (e.g., ticket revenues or membership fees) or public sources. JEL Classification number H20, H42, C70, D80, Z10     

New lamps for old: financialised governance of cities and clean energy

ABSTRACT

Using a six-year case study of Glasgow’s Sustainable City business model, this paper examines interactions between financialised governance of cities and clean energy strategies. Research on the role of cities in developing clean energy has paid limited attention to the interaction with financialised governance of infrastructure, which makes the implementation of plans largely dependent on private investment. A conceptual approach combining economic sociology of actor networks and urban political economy is used to analyse the career of the business model designed to transform old infrastructures into new clean energy assets. The analysis focuses on interactions between city council, public bodies and electricity distribution network business. Climate policies are creating uncertainties for energy businesses over revenues from ageing networks, suggesting scope for alliance with local governments. Making new liquid assets for clean energy from old infrastructure is however shown to be a process marked by instability and reversals. In conclusion, it is argued that concepts from actor-network theory and urban political economy used together reveal the hidden contingencies of financialisation in particular socio-technical interactions, and their materiality in the context of climate change.     

Moral Economies in Science: From Ideal to Pragmatic

In the following pages we discuss three historical cases of moral economies in science: Drosophila genetics, late twentieth century American astronomy, and collaborations between American drug companies and medical scientists in the interwar years. An examination of the most striking differences and similarities between these examples, and the conflicts internal to them, reveals constitutive features of moral economies, and the ways in which they are formed, negotiated, and altered. We critically evaluate these three examples through the filters of rational choice, utility, and American pragmatism, using the latter to support the conclusion that there is no single vision of moral economies in science and no single theory—moral, political, social—that will explain them. These filters may not be the only means through which to evaluate the moral economies examined, but aspects of each appear prominent in all three cases. In addition, explanations for decisions are often given in the language of these theories, both at the macro (policy) level and at the local level of the moral economies we discuss. In light of such factors, the use of these frameworks seems justified. We begin with an attempt to define the nature of moral economies, then move to a consideration of scientific communities as moral communities operating within material and other constraints which we relate to wider questions of political economy and societal accountabilities.

Knowledge for the West,Production for the Rest?

This article develops the argument that a ‘knowledge economy,’ despite its cheerful optimism, is also an elegant incarnation of the demise of Western economies. An analysis of policy documents, research statements, and national accounts reveals this paradoxical coexistence of anxiety and progress in the discourse on knowledge economies. While the concept is often hailed as a temporal concept (superseding other forms of economic production), this article argues that a knowledge economy is best understood as a spatial concept – it is a way of contending with global reorganizations of production. This spatial approach is elaborated to tackle three paradoxes. (1) A knowledge economy enfolds defeat with progress. (2) A knowledge economy downplays the importance of industrial labor and simultaneously depends on it to materialize its ideas. (3) While seemingly intangible and ephemeral, a knowledge economy is fixed in place in national economies through government and corporate policy (including through the emergent phenomenon of ‘knowledge-adjusted gross domestic products’). A spatial approach provides a view of the tenuous global interconnections and specific conditions that prop up a knowledge economy, and shows how the concept is mobilized to redraw the map so that endangered economies can regain their challenged sense of centrality in a world economy.     

The Politics of Value in French Funeral Arrangements

This paper draws upon the history of the funeral market over two centuries to examine three major devices which have played a central role in the funeral economy, both in terms of defining the nature of the ‘goods’ and their attendant value but also in regulating the relations between the Pompes Funèbres and the other institutional actors involved. It highlights the ways in which these devices provide a ‘politics of value’ performing the articulation between the formatting of economic value and the pursuit of political concerns. First, observing the constitutional phase of the private industry, it examines the ‘system of the classes’ as a central device of managing dissonance between conflicting interests. Then, a historical jump leads us to half way through the twentieth century to the market infrastructure formed by the management of ‘care for the deceased’. As a third point, the exponential development of death insurance in recent years appears as an expression of rationalization of funeral arrangement. The analysis of the market devices will highlight an essential property, that is, the incorporation of a ‘calculation formula’ which set up both the profit sharing and the handling of moral and political issues.     

Mission Completed? Changing Visibility of Women’s Colleges in England and Japan and Their Roles in Promoting Gender Equality in Science

The global community, from UNESCO to NGOs, is committed to promoting the status of women in science, engineering and technology, despite long-held prejudices and the lack of role models. Previously, when equality was not firmly established as a key issue on international or national agendas, women’s colleges played a great role in mentoring female scientists. However, now that a concerted effort has been made by governments, the academic community and the private sector to give women equal opportunities, the raison d’être of women’s universities seems to have become lost. This paper argues otherwise, by demonstrating that women’s universities in Japan became beneficiaries of government initiatives since the early 2000s to reverse the low ratio of women in scientific research. The paper underscores the importance of the reputation of women’s universities embedded in their institutional foundations, by explaining how female scientific communities take shape in different national contexts. England, as a primary example of a neoliberal welfare regime, with its strong emphasis on equality and diversity, promoted its gender equality policy under the auspices of the Department of Trade and Industry. By contrast, with a strong emphasis on family values and the male-breadwinner model, the Japanese government carefully treated the goal of supporting female scientists from the perspective of the equal participation of both men and women rather than that of equality. Following this trend, rather contradictorily, women’s universities, with their tradition of fostering a ‘good wife, wise mother’ image, began to be highlighted as potential gender-free institutions that provided role models and mentoring female scientists. By drawing on the cases of England and Japan, this paper demonstrates how the idea of equality can be framed differently, according to wider institutional contexts, and how this idea impacts on gender policies.     

The Double Public Good: A Conceptual Framework for ``Shared Experience' Values Associated with Heritage Conservation

This paper introduces the double public good model as a representation of the simultaneous externalities that complicate decision making in the cultural heritage sphere. Social welfare is modeled as depending on both public and private benefits of households' production of individual heritage experience, which in turn depends on the stock of historic assets (a public good) and access effort (a private good). The public benefit of private experience arises from ``shared experience' that fosters cultural identity and social understandings. The model generates marginal efficiency conditions for the amount of physical preservation, amount of access, and intensity of access. The model highlights the need for dual-level policy making in order to avoid unbalanced heritage preservation efforts that have been of some concern in the literature.     

The Experimental Economy of Geoengineering

Will the practical application of geoengineering technologies inadvertently bring about the catastrophic futures they are meant to pre-empt? And is such elicitation of unpredictability as unintended as it might appear – the accidental consequence of the extension of a modernist attitude to control and domesticate nature? To grasp what is at stake in such questions, this paper traces out the marginal history of ocean geoengineering, its correlative ‘green’ economy, and through the deployment of algae as an inventive world-remaking device, their co-formation of the earth as a site of unbounded experimentation – of what I call experiment earth. My argument here is that such methods of geoengineering inject disturbances into the algae-ocean-earth system that do not seek control, but to elicit surprise and explicate the mechanisms of the complex permutations of their unpredictability, where new forms of knowledge and value are created not through the application of preconceived ideas or a process of commensuration, but through the harnessing of anticipation and the generation of surprise. How, I ask, are we to understand the lineaments of a pre-emptive ‘green’ economy that is premised on not just managing, but speculatively materially recomposing the non-linear chemical and ecological constitution of the earth’s metabolism? And what, from this vantage point, is the earth becoming?