Javier Izquierdo: Tribute to a SSF pioneer
July 6, 2010
Earlier this week, Fabian Muniesa wrote to me saying that Javier Izquierdo died last the previous week. Javier was one of the unsung heroes of SSF: his insights and ideas inspired and motivated my thinking about the performativity of financial economics and, more generally, his take on sociology of finance was clearly pioneering.
In 2001, Javier published the paper ‘RELIABILITY AT RISK The supervision of financial models as a case study for reflexive economic sociology’, (European Societies, 3:1, 69-90). In that paper, he sketches the broad mechanics of what later came to be known as performativity of economic models in financial markets and defines these mechanics as a new form of financial risk:
‘Computational financial engineering’ intends to build from scratch the kind of transparent cultural machines that could be fully understandable and controllable by the king-scientist. However, put to work in a market environment where stability is increasingly determined by their being accurate, computational (econometric) models of financial risk now have to face the perverse effects of their own success in the form of new, uncontrolled types of financial risk.
The reflexive loop of performativity is evident here, but note also that the tension between scientific knowledge and technological knowledge is addressed here. This tension, researched extensively in the sociology of science was little touched upon in economic sociology until the advent of SSF in the early 2000s. So, Javier did not only help to frame the specific causal mechanisms of performativity, but also connected them to a broader intellectual landscape where economic sociology, ANT and Barnsian sociology of science interact freely and create new and exciting combinations.
This broad landscape was also translated into wide disciplinary implications. The analysis in the paper refers to financial regulation, to the practices of financial engineering and, reflexively, to the nature of risk and uncertainty in the sociological thinking. Some of these issues were touched upon in later SSF work, but, not as sufficiently and rigorously as, say, the risk and regulation literature. In all honesty, reading the text from 2001 by Javier Izquierdo, now, in 2010, I am struck by how much broader the vision for SSF can (and should) be. I would recommend reading this paper to everyone who is interested in the sociology of financial markets and financial risk. I believe that it will enrich our on-going conversation about this issue. Just remember, if many of the things in the paper seem familiar, it is because Javier Izquierdo identified the issues many of us later developed empirically, just that he recognized them ahead of us.