markets have and are culture


Last week Peter Levin wrote an interesting blog post about different kinds of cultural economic sociology. Some research focuses on how culture affects market activity (e.g., pricing, volatility, etc.) and other research explores the market as a unique kind of cultural phenomenon. Peter sees these research emphases as existing along a theoretical continuum.

[T]he embeddedness framework implies a split between the economic activity, something purely economic, and the culture/structures/networks that have effects on that economic activity. In effect embeddedness argues for more sociological independent variables for economic dependent variables….On the other side of this dichotomy are those who argue that markets are culture. That is, markets are themselves cultural phenomena. This is close to, but not identical to Viviana Zelizer’s critique, that markets are subsumed by culture.

Peter does not stop there. He then suggests that our perspective on the market is probably related to the kind of market that we’re empirically interested in. Borrowing from Swidler’s conceptualization of unsettled/settled times, Peter suggests that when analyzing markets that are unsettled (e.g., the emergence of the consulting industry), we take a “markets as culture” view. When studying settled markets (e.g., a cross-sectional view of the stock market), we focus on the cultural mechanisms that underlie their functioning. He provides a nice figure that illustrates this.

Missing from his figure is the use of social movement theory in economic sociology. My sense is that much of this research would fit on the right side of the diagram. Social movement scholars focus on how “cultural entrepreneurs” actively change others’ perceptions regarding the appropriateness of an activity and generate market demand for new products or services. Consider the work of scholars like Huggy Rao who examines the emergence and legitimation of new industries or Mike Lounsbury’s work on movement efforts to create a market for recycling. Interestingly, this kind of economic sociology has a lot in common with the work of organizational ecologists, who are also interested in how new industries or markets are legitimated. This theoretical conceptualization would support Omar’s claim that organizational ecology is a “radically cultural” perspective.

Peter has more to say about this, and I wouldn’t venture to predict what his conclusions will be. But my take on this is that economic sociology is slowly but surely breaking down this continuum. For one, if you take Zelizer seriously, it’s hard to ever disentangle the cultural aspects of markets from markets as cultural objects. But additionally, I think in reality its hard to divorce “how the market functions” from “how markets get created.” The economist Albert Hirschman was getting to this in his brilliant, Exit, Voice and Loyalty, in which he argues that firms actively try to blunt the influence of the price mechanism on their behavior, and organizational members or other stakeholders similarly try to use the price mechanism as a way to instigate change. In Hirschman’s analysis, price formation (a typical economic mechanism) could not be divorced from the presence of voice (a clearly cultural form of expression). Both have the potential, especially when used together, to cause a shift in the market or in other words to lead to an unsettled market.

I think this is one direction that future research on social movements and markets will go. Take, for example, the empirical phenomenon of corporate social responsibility. CSR didn’t just jump out of a hat one day. Shareholders and other stakeholder activists put a lot of pressure on corporations to evolve their policies to become more responsible to the environment and local communities. The institutionalization of CSR was a reaction by the corporate community to both activist pressures to change their policies and uncertainty in the market, as exhibited in changing and volatile stock prices. Both fed into each other. The result was the emergence of new measurement instruments that kept track of corporate initiatives and, subsequently, a rise in the level of market activity of consumers and investors doing business with companies that meet their ideals. The “market for virtue” was then a creation of both market forces and the cultural entrepreneurship of activists and interested stakeholders. This kind of perspective threatens, I think, to collapse the conceptual dichotomy of “markets have culture” and “markets are culture.”

Written by brayden king

February 22, 2008 at 8:55 pm

6 Responses

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  1. Great post!

    But, while some things can perhaps be gained in this type of conceptual “collapsing” — aren’t some key issues also lost?

    So, for example, Giddens collapses agency and structure into “structuration;” but, doesn’t that just, as Archer put it, “throw a blanket over the two constituents, structure and agency, which only serves to prevent us from examining what is going on beneath it” (1995). I’m afraid the above exercise of collapsing markets and culture might similarly muddy the waters rather than clarify. Or?



    February 22, 2008 at 10:58 pm

  2. It’s tricky to understand what it means to say A has x and A is x at the same time. Instead of a cross-classification, maybe think about branches on a tree: either markets have culture or they don’t. If they have culture, either culture is all they have, or it isn’t. On this view, “markets have culture” and “markets are culture” are not two theses awaiting a missing synthesis. Rather, the latter claim is the strongest version of the former. This would still be consistent with Peter’s earlier point that people at different points on the tree tend to cherry-pick cases that suit them.

    Here, you seem to be pointing to a strong yet very defensible alternative, maybe best characterized as “Markets always have culture” (and interpreted with an implicit “in a way that matters”).



    February 23, 2008 at 4:57 am

  3. Hmm, I’m not sure I buy your logic. Culture has various dimensions, each of which can affect the other. If you think that industries are constituted by categories and that categories are cultural, and you also believe that new categories emerge as actors bring in new frames by which to legitimate their activities and you think that frames are cultural, then it’s not clear why culture can’t be on both ends of the equation.



    February 23, 2008 at 5:23 am

  4. We’re probably not disagreeing. I’m motivated here mainly by a desire to avoid sloppy use of the word “culture” and, when not sloppy, to avoid confusion arising from having to use the same word to do too many different kinds of work. So if you want to make the strong, all-culture claim, that’s fine. But I still think it’ll be easier to have a much more specific vocabulary — categories, frames, doxa, whatever. As you use yourself.



    February 23, 2008 at 5:32 am

  5. Right, that makes sense.



    February 23, 2008 at 5:40 am

  6. […] sociology and culture.  (Peter’s take on culture and markets has been a topic of debate here before.)  The general tone of these review essays is triumphant.   Take, for example. Polletta’s […]


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