Dave Elder-Vass & Jamie Morgan (2023)
real-world economics review, issue no. 105, pp. 87-110
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JAMIE: In any case, we still haven’t said much about conventions theory so we should start to turn more explicitly to that. Who would you say have been the most prominent of the conventions theorists?
DAVE: Over the years prominent figures associated with the tradition include Alain Desrosières, Francois Eymard-Duvernay, Olivier Favereau, André Orléan, Robert Salais and Laurent Thévenot. But perhaps it would help to say a little about where conventions theory first came from. It originated in the 1980s when a group of French economic statisticians, partly under the influence of the sociologist and anthropologist Pierre Bourdieu (so interdisciplinarity was baked in from the start), became critical of some of the positivist assumptions of traditional statistics (Desrosières 2011). Statistics were widely seen as objective neutral reflections of self-evident facts about the world. The conventions theorists, however, recognized that statistics reflected judgements about what should count and thus what should be counted, judgements about how to count, and in particular judgements about how to classify (or “qualify”) the things being counted. Once statistics had been produced in a particular way, this tended to embed and be perpetuated. Judgements were repeatedly re-used in further work and became stabilised as taken for granted assumptions. The conventions theorists took the essentially social constructionist view that these assumptions represented somewhat arbitrary choices, yet once made they became stabilised by social use, but those choices could have been made differently (Diaz-Bone and de Larquier 2020: 5–6). This core concept of conventions then came to be extended and applied in different contexts beyond statistics.
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JAMIE: And, to reiterate, like any other approach conventions theory exhibits dispute and diversity…
DAVE: That’s right, and as a result the concept of a convention has been used in a variety of rather different ways in the tradition, making it difficult to provide a clear and unambiguous definition. Diaz-Bone and de Larquier, in the introduction to their Handbook of Economics and Sociology of Conventions (still under construction), describe them as “institutional logics for the valuation or valorization of goods, actions, and persons” (Diaz-Bone and de Larquier 2020: 1–2). That has the merit of being loose enough to accommodate the full range of cases, but at the inevitable cost of leaving it rather unclear what would count as a convention.
JAMIE: Still, before moving on to discuss your recent book Inventing Value and how it relates to conventions theory, it might be worth here just summarising what conventions theory “is”…
DAVE: Well, I can’t guarantee to be any more definitive than Diaz-Bone and de Larquier, but perhaps I can give a definition that complements theirs: conventions theory is a trans-disciplinary tradition that focuses on how stabilised shared understandings shape our classification, evaluation, and valuation practices and as a result influence our social interactions, including our economic interactions. In a sense it therefore provides a more socialised and realistic alternative to the mainstream view of decision-making as purely a process of the rational calculation of self-interest. So, for the statisticians for example, shared understandings of different classes of labour are employed to generate labour statistics. Or for Boltanski and Thevenot, shared understandings of standards of judgement are used to resolve social disputes. Or for André Orléan, shared understandings of how we should value financial assets, like Keynes’s conventions, shape outcomes in financial markets, which I hope we can discuss in more depth shortly. From a critical realist perspective, I would want to extend the argument a little further: we should see decision-making as multiply determined by many different causal mechanisms, so that a fully realistic account of it would take into account both conventions and rational calculation, but also other factors, such as the habits or dispositions we take for granted (as stressed by some institutionalists) and our emotional commitments.
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JAMIE: When you first became interested in the subject of value, valuation and pricing was it immediately obvious that your work and conventions theory overlapped?
DAVE: No, it took me a while to realise (or perhaps decide?) that the work I was doing on value fell within the conventions tradition as well as the critical realist one. It had struck me that the concept of value, in the sense of the monetary value of assets and commodities, was central to the operation of our contemporary economy and yet it had almost disappeared from view, in the shadow of two enormously powerful misconceptions of value and its origins: the neoclassical sense of value as the equilibrium price of a good and the Marxist sense of value as a quantity of socially necessary labour power. I recognised that we only buy things because we ascribe value to them, and hence the commodity and asset economies depend utterly on the processes through which buyers (but also sellers) come to ascribe and quantify monetary value. But the Marxist analysis ignores that, and the neoclassical analysis collapses the whole question of the prices people are willing to pay to the exogenous preferences of buyers, thereby ignoring many of the most important factors that shape what prices people are willing to pay for things.
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DAVE: […] One of the more important arguments I develop in Inventing Value is that valuation conventions, and value narratives that are used to connect individual assets and commodities to particular valuation conventions, are strongly shaped by deliberate discursive work, in particular work done by people I call value entrepreneurs (I mentioned this with the Snap example if you recall). Value entrepreneurs, usually operating on behalf of larger structures like corporations, actively seek to influence how the assets or commodities in which they have an interest are valued by influencing the discursive environment. The luxury goods industries, for example, have gradually but cumulatively built a sense that the goods they produce have status because they embody heritage and heritage should be valued – as Boltanski and Esquerre have argued in their recent work on enrichment (Boltanski and Esquerre 2020). One extraordinary example is the way in which the guitar company Fender, having recognised that worn guitars have a prestige arising from the sense that they have served expert players well for many years, have started to produce pre-damaged new guitars and sell them at a premium.
JAMIE: These are interesting examples, but they seem to rest on physical qualities of commodities. Your main focus though is financial assets…
DAVE: Because they don’t have clear material consequences for our well-being on which to hang valuations, conventions are even more significant for financial assets. Their value rests entirely on future revenue streams, which of course takes us back to your quote from Keynes. As Keynes said, financial valuations rest quite heavily on the thoroughly unreasonable expectation that things will continue as they are, and hence that future income streams can be taken as read for the purpose of valuing assets. But what does it mean for things to “continue as they are”? Does it mean, for example, that a stock will continue to yield the same percentage dividend indefinitely or perhaps that internet firms will be able to extract a certain number of dollars of advertising revenue per user per annum, or…? What versions of “continuing as they are” are going to be transformed into conventions, and which one of them (or which ones) is going to apply to any given asset? Each of these is a different way of imposing a sense of predictability on an inherently uncertain future, and the prices that can be achieved for financial assets are highly sensitive to which of them is applied. Just as in commodity exchange, firms have a powerful interest in influencing the conventions applied to assets and so engage in shaping value discourses. Financial value entrepreneurs are in the business of developing favourable conventions for the assets they are marketing and producing a sense that this is the natural and obvious way of valuing the assets concerned. But different conventions could have been applied, with the result that investors would have valued the assets concerned quite differently.
OpenEdition vous propose de citer ce billet de la manière suivante :
GdL (16 novembre 2023). From original institutionalism to the economics of conventions and Inventing Value: An interview with Dave Elder-Vass. Économie des conventions. Consulté le 21 mars 2025 à l’adresse https://doi.org/10.58079/n4f3