From performativity to political economy

Index investing, ETFs and asset manager capitalism

Bibliographic Data

ID8046801
AuthorsBonnie Braun (0000-0002-5186-5923, Max Planck Institute for the Study of Societies, Paulstr. 3, 50676 Cologne, Germany, corresponding author)
Year2015
Volume21
Issue3
Pages257-273
Publication date2015-10-29
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueNew Political Economy (JOURNAL)
Journal identifiersISSN: 1356-3467 • E-ISSN: 1469-9923
PublisherTaylor & Francis (PUBLISHER • GB)
DOI10.1080/13563467.2016.1094045
OpenAlexW2160370263
LanguageEN
Citations received89
References cited95

As a discipline, political economy has often been reluctant to engage with the details of market devices and practices. This weakens the microfoundations of its analysis of capitalist macro-dynamics and cedes unnecessarily large stretches of intellectual territory to economics. The performativity approach developed by Michel Callon offers a theoretical way out of this dual dilemma. It allows political economists to study 'the economy' directly by investigating the links between the diversity of market devices and the diversity of capitalism. The argument is illustrated by an analysis of the gradual, performative evolution of the investment intermediation market, where the traditional high-cost model of active asset management has been challenged by the emergence of a low-cost alternative in the form of index-tracking investment funds. Highlighting the distributive implications of this development, the current article shows that the financial innovation of exchange-traded funds played a crucial part in the completion of the socio-technical agencement of the 'passive investor'. In contrast to the recently resurgent notion that the two approaches are incompatible, this article insists that the micro-sociological study of market devices fosters the analytical capacity of political economy by opening up new perspectives on the macro-dynamics of contemporary capitalism. In the case at hand, it brings into sharp relief the contours of the emerging constellation of 'asset manager capitalism

Financialization · Performativity · Banking stability, regulation, efficiency · Housing, Finance, and Neoliberalism · Private Equity and Venture Capital

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