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Reading :: The Laws of the Markets

Posted by: on Jul 13, 2010 | 2 Comments

Laws of the Markets
Ed. Michel Callon

Reading Thompson’s Between Hierarchies and Markets reminded me of this book, which Thompson uses as his primary source for actor-network theory. I think I tried reading it a few years ago, but was put off by the fact that most of the contributions are not ANT-oriented. This time, with considerably more background in social network analysis and related areas, I rallied and finished it.

The Laws of the Markets takes on how markets are made concrete and stabilized; contributors come from socioeconomics. As you may know, I am not a socioeconomist, so take my reading with a grain of salt.
The book starts with a lengthy introduction by Michel Callon, who asks: Why does economics have so little to say about the market? (p.1). His assertion is that “economics, in the broad sense of the term, performs, shapes, and formats the economy, rather than observing how it functions” (p.2). And “the aim of the present book is to contribute to the analysis and understanding of the subtle relationships between economics and the economy; not within an historical perspective, although some chapters do include historical material, but within a deliberately anthropological one” (p.2). And in that anthropological perspective, he overviews the book’s chapters, interspersed with thoughts about economics, markets, and networks – and rhetoric.
About the latter, Callon cites McCloskey’s book on the rhetoric of economics, “although its definition of rhetoric remains so classical that it is obviously limited” (p.31). “Rhetoric, defined as the art of building alliances to establish a favorable balance of power whether in science or politics, cannot be reduced to an excess of mathematization of generalizing abstraction intended to terrorize the opponent” (p.31), Callon chides, dividing rhetoric from brute calculation.
Let’s skip a bit, because many of these chapters were interesting to me, but not connected enough to my own research to describe in detail. For instance, Vivianna Zelizer’s “The proliferation of social currencies” has a fascinating discussion of earmarking, wallet systems, and other domestic and social currencies. Mitchel Abolafia’s “Markets as cultures: An ethnographic approach” has a terrific discussion of how he gained access to a firm in order to conduct his ethnography; I’m thinking about using it next time I teach a qualitative research class.
Interesting in a deeper way was David Stark’s “Recombinant property in East European capitalism.” Stark has a fascinating take on how Eastern Europe’s informal interfirm networks, developed to make the command economy of the USSR work, survived the collapse of the Soviet regime to become a partial substrate of the new capitalist regime. “In short, in place of disorientation, we find the metamorphosis of sub-rose organizational forms and the activation of pre-existing networks of affiliation” (p.117). “Thus, we examine how actors in the post-socialist context are rebuilding organizations and institutions not on the ruins but with the ruins of communism as they redeploy available resources in response to their immediate practical dilemma” (p.117). So in Hungary, for instance, we see new property forms under the heading of recombinant property (p.119). One feature of recombinant property is inter-enterprise ownership, with the State buying substantial stakes in many companies, and enterprises buying each other’s stocks (p.122). Stark has a name for this: a “recombinet,” or network of recombinant property (p.128). State paternalism continues to exist in a big way, but whereas under the Soviets state paternalism manifested as managing assets, in the post-socialist regime, state paternalism manifested as managing liabilities (p.132). Recombinant property, Stark concludes, is “an attempt to have a resource that can be justified or assessed by more than one standard of measure” (p.134) – e.g., profitability and eligibility – with different strategies for each measure.
At the end of the book, Callon supplies a final essay: “An essay on framing and overflowing.” Here, he argues that the market is not simply expanding, it’s emerging and reemerging (p.245). Callon takes the economic notions of externalities and overflows, puts them in contact with Goffman’s notion of framing, and playfully uses them to discuss an ANT understanding of markets. The conventional approach, he says, is to see framing as normal and overflows as rare leaks (p.250). But from ANT’s perspective, it’s overflows that are the norm, and framing is rare and costly (p.252). All framing, he says, amounts to an effort to extricate agents from the network; overflows, in contrast, have many sources and flow in many directions (p.253). He points to intermediaries, which “secretly cross the frame’s boundaries” (p.256), and insists that “no externalities can exist without relationships” instantiated through these intermediaries (p.257). Overflows, he continues, define groups (p.258). This discussion leads directly to one of hybrid forums (p.260; see also his Acting in an Uncertain World).
In all, the collection is a little uneven, but it has some standout essays, particularly Callon’s. If you’re interested in ANT, check it out.


  1. Tim Graham
    October 5, 2012

    Fantastic little overview – thanks Clay!

  2. Clay Spinuzzi
    October 6, 2012

    Glad it was useful!

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