Does SSF mean politics?

Following Martha’s and Alison’s very interesting exchanges from a few days ago, I thought that commenting on the relations between SSF (or works related to this evolving trend) and politics is called for. Martha mentioned that: The greatest criticism the research program [SSF] faces is the same as that faced by laboratory studies – the inability to move out of the organization of micro-activities.

Well, I am not sure that this is the greatest criticism that SSF faces. We’ve been accused of much worse… But, seriously, Martha has a very good point here. Both social studies of science (or at least some strands in it) and SSF were (and are) being accused of being apolitical. I will not try to defend ‘laboratory studies’ here, but I think that I can make a case (or at least two bullet points) against the claim that SSF is politics-free.

First, SSF exposed the self-referential loops at the basis of financial economics and thus opened the field for new interpretations of economic behaviour. This point is more focused on the performativity of economics argument in SSF than on other parts of the field, but it has wide implications. Showing that markets are, say, embedded in pre-existing social structures, gendered or biased towards the West is extremely valuable from a social perspective and important from a political perspective. However, such analyses are likely to be regarded as external to what mainstream economics would see as core, the way economic theory describes economic activity. So, much of the analysis offered by economic sociology could be faced by the archetypical response: ‘Yes, we know that markets are geographically/ethnically/gender-wise biased, but that’s only because they are not fully evolved yet.’ Hence, economic theory itself is intact – it’s society that’s to blame for markets’ inefficiencies, not markets. On the other hand showing that economic theory played a performative role, leaves economics no place to hide, sort of speak. It is economics, SSF shows us, that takes an active part in making markets what they are.

Second, SSF aims to show that ‘the market’ does not end where the trading floor does. Here SSF follows in the footsteps of laboratory studies (especially, of course, The Pasteurization of France). Unlike other works in sociology of financial markets that preceded it and focused on the trading arenas as the exclusive focal point of markets, SSF portrayed financial activity and structures as an ever-expanding network where various types of agents interact: traders, exchange officials, regulators, experts, as well as, of course, a plethora of non-human agents. This is the first example that comes to mind, but there are others. In doing so, SSF, in effect, states that markets do not necessarily revolve around ‘price discovery’, but that markets operate as what David Stark calls heterarchy. That is, there is a continuous competition for dominance in markets among various worldviews, some of which are radically incompatible with each other. Of course, SSF did not invent this approach from scratch. Fligstein’s Markets as Politics alludes at the markets’ polyphony. However, SSF goes a step further – a big step. SSF shows that the multiplicity of financial markets does not take place only at the national or global levels, but that it is woven even into the operation of the smallest trading units; for example, a trader, a sheet with pre-calculated prices and the compliance officer. The very thing SSF is ‘accused of’, the focus on the internal workings of markets’ organisations, is what provides this approach with such strength.

So, does SSF mean politics? Yes it does. By revealing empirically the performative nature of financial markets and by showing the heterogeneity of networks of financial markets, SSF makes a political statement. Of course, one can ask if being political is the intention of SSF scholars. This is an open question. However, just like Howard Zinn’s famous statement that one cannot be neutral on a moving train, I think that SSF shows us that one cannot argue with mainstream economists and be politics-free.