AFEP-IIPPE international conference Lille 3-5 July 2019

Sciences-Po Lille

Convention theorist contributions at the AFEP-IIPPE international conference “Envisioning the Economy of the Future and the Future of Political Economy” Lille 3-5 July 2019

Anaïs Henneguelle (University of Rennes 2) and Gaël Plumecocq (INRA Toulouse)

In Lille at Sciences-Po Lille the congress of the French Association of Political Economy AFEP (Association française d’économie politique) took place (in collaboration with International Initiative for Promoting Political Economy, IIPPE). It was big event with up to 800 participants and it was coined by many contributions from representatives of the French institutionalist approach of economics of convention. 

Gaël Plumecocq and Anaïs Henneguelle,
the organizers of the three sessions

This report presents discussions in three sessions devoted to economics of convention first, and at the end presents an outlook about the future of economics as seen from economics of convention. Here Guillemette de Larquier presents some remarks also on additional conventionalist contributions to the congress at Lille.

10 young researchers present their conventionalist work at the AFEP 2019 congress

Version française

30 years have passed since the publication of the special issue of the French economists journal Revue économique (published with the title “économies des conventions”, Vol. 40(3) in 1989), which was devoted to the economics of convention (in short EC) at this AFEP congress. This congress was an opportunity to review the current status of the conventionalist research agenda. In particular, the call for proposals aimed to bring together as a matter of priority (but not exclusively) the work of young researchers, who work on their problems using the conceptual frameworks of EC. The aim was to consider how the conventionalist research program can or should evolve. In which way have social transformations, such as the emergence of environmental issues, the renewal of public policies or changes in labor law (among others) been taken into account by the approach of economics of convention? How and in what ways does conventionalist work on the scope and functionalities of companies, in the field of health, relating to energy and poverty issues, or on the production and sharing of value(s), etc., renew the approaches of EC? What disciplinary articulations, new or renewed, are the new working fields of young researchers in this approach? How can we envisage cross-fertilization within the economic discipline with the different currents of thought? The three conventionalist sessions thus made it possible to explore these questions, and to raise others. It brought together about ten young researchers working in EC. The debates, introduced for each panel by different senior researchers, provided an opportunity to discuss how this work mobilizes and reworks the conventionalist research agenda.

Session 1/3:  Conventions and institutions of public policy
Discussants: Rainer Diaz-Bone (University of Lucerne, Switzerland) & Amandine Rauly (University of Reims Champagne Ardenne)

  • Victor Duchesne (University of Paris 13): “Criticism, ideologies: analysis of discourses and conflicts around social security from a conventionalist perspective”

Victor Duchesne, the first speaker on this session, began by studying a reform of the French social security system that took place in 1967. His analytical grid uses the terms of  EC, even if for him the framework of cities is too rigid to be adapted to his study. He therefore tried to go apply concepts other than those of cities: that of “referentials” in particular. The “myth” of the social security hole corresponds exactly to the classic definition of “conventions”. From 1967 onwards, the question of the deficit became central. In their discussions, members of French parliament (MPs) debated not only the relevance of taking the deficit into account but also the way it is counted (the statistical categories that underlie it). What should now be considered as an obvious argument (the deficit indicator) then was the question. In his analysis, Victor Duchesne distinguishes 3 “spirits” or “conventions” that govern social security: an anti-capitalist convention (carried by the communists, for example), a solidarity convention (carried by the mutualists) and a liberal convention (mainly carried by economists and ministers). The issue at stake each time is the global vision we have of the social protection system, justice or the common good.

  • Pierre Robert (University of Lille): “How to justify inequalities of access: a study of energy policies in Senegal through the convention of “needs” in energy services”

Pierre Robert begins with some introductory observations on energy poverty: in Senegal, for example, 36% of the population does not have access to electricity. It is difficult to represent what an “acceptable energy service standard” is, which is the basis for the common definition of energy poverty. Indeed, these standards are conventional. This standard is based on the following hypothesis: we can identify an “energy services needs agreement”, which will qualify the level of energy need to which everyone must have access in a specific context. This convention makes choices on legitimate needs. He therefore seeks, in his work, to identify this convention and its evolution. To do this, Robert studies energy policies from the independence of Senegal (1960) to today, with archives, grey literature, interviews. For him, there are four criteria to define “energy service needs”:
– The “orientations” (populations, spaces, sectors of activity)
– Energy services (those related to domestic energy or motive power)
– The types of energy (traditional such as firewood for example, or modern such as oil, gas)
– Consumption levels.
In addition, several registers of justifications are used in energy policies:
– Market justification (cost constraints…)
– Justification of public interest (principle of universal access)
– Community justification (tradition)
– Justification of energy security (improvement of the energy mix)
– Ecological justification (environmental impact)
Pierre Robert explained one result in particular: rural populations are completely excluded from the definition of the energy convention, which allows other actors to support their interests (for example, to put forward a low demand to allow opening up to competition and liberalization).

  • Adèle Sébert (University of Lille): “Thinking about the coexistence of actors in the fight against fuel poverty”

Adèle Sébert presented her current field, which covers the Haut-de-France region and is in line with Pierre Robert’s previous intervention. It thus recalls that fuel poverty has been defined by law since 2009, with the notion of “meeting basic needs” without explaining what it is (but by linking them to the notion of housing). In France, in 2017, fuel poverty is estimated to affect 6.7 million people. French literature links “fuel poverty” more closely to housing, while English literature reads it more closely to the issue of health. This issue is analyzed separately from the construction of the energy market, in particular. However, this construction, where gas and electricity prices continue to rise, mechanically increases the proportion of households in fuel poverty. What would a conventionalist approach have to say on this subject? Such an approach makes it possible to question the definition of the “quality” of the energy service and thus to question the idea of “need”. This would also raise questions about the conditions for satisfying this need and the associated “conventions”.

Session 2/3: Company conventions and sectors
Discussants: Christian Bessy (École normale supérieure Paris-Saclay)

  • Nathalie Magne (University Paul-Valéry Montpellier 3): “When a traditional company becomes a cooperative: what processes for building legitimacy?”

Nathalie Magne presented a study on the transition of “classic” companies in the industrial and construction sectors to a cooperative model. It questions the power of action of individuals in a context of organizational change and institutional pluralism, in particular with the confrontation of two logics: competitive enterprise and enterprise of the social and solidarity economy. To this end, Nathalie Magne studies the confrontation of two registers of legitimacy. In this context, marked by a strong tension between the will to act on the rules to transform the organization and the weight of the organization that frames the wishes of individuals, Nathalie Magne relies on Schuman’s work. It distinguishes between normative and moral legitimacy, pragmatic legitimacy and cognitive legitimacy (in which conformity with the company’s vision as a space of possibilities is at stake). The results highlight differentiated strategies for building legitimacy, depending on the different types of interlocutors (financiers, suppliers, internal stakeholders, possibly a court…). These involve demonstrating the economic efficiency of the cooperative, at both normative and pragmatic levels, to be brought closer to the industrial city; the superiority of the cooperative form (civic city); and respect for the participatory tradition of the company (mobilization of the trust register). This work highlights the capacity of actors to transform the organization, without necessarily resorting to general registers of legitimacy.

  • Tiana Smadja (Terres Univia, Paris): “Obstacles and levers to the development of the French pea sector: lighting according to the Economics of Convention”

Tiana Smajda is working on a research-intervention approach to the analysis and development of the protein pea sector in France, in a project conducted with the oil-protein inter-profession, as part of their action plan to strengthen the French supply of vegetable proteins. In this sector, which is mainly used for animal feed, production is highly variable and agricultural incomes are uncertain. This work mobilizes the transition studies, and in particular the notion of locking to analyze the obstacles to the development of these sectors. Tiana Smajda presents the preliminary results of her survey, conducted among 127 stakeholders from 4 value chains in Europe. These concern, on the one hand, the governance and coordination of the actors in the sector, and, on the other hand, the practices and strategies of the actors around the definition of quality and exchange prices. This work thus makes it possible to highlight two groups of value chains: those in which production contracts exist, specifying expected quality criteria and for which the actors say they are satisfied with the functioning of the sector; and those in which there are no stable benchmarks and reference frameworks on product quality, referring to the dissatisfaction of the actors with the way the sector functions. The main lever for the development of this sector therefore lies in the lack of conventions on the quality of products traded along the value chain, which is a way of extending this work. 

  • Philippe Semenowicz (University of Paris-Est): “The conventionalist approach to CSR in the light of social clauses in public procurement”

Philippe Semenowicz’s study is part of the conventional economic theories on corporate social responsibility. This posture not only criticizes the existing business model, but also questions new business conventions. In this context, Philippe Semenowicz approaches CSR from the perspective of the renewal of legal frameworks, in this case the introduction of social clauses in public procurement: are the learnings required to implement a CSR approach possible within the legal framework, or does this require amending the legal framework? This problem is essentially conventionalist, insofar as it involves testing the justifications according to which CSR is optimal. It is also a question of analyzing legal clauses as conventions referring to issues of social justice and the common good (for example, positive discrimination in employment). A historical analysis of public procurement reforms shows that the evolution of social clauses articulates institutional, contractual and also conventional dimensions, in particular on the modalities of implementation (with, for example, the use of a facilitator). The results show that two types of CSR conventions are at work: “bad” conventions consist in complying with clauses, without necessarily changing exchange practices; “good” conventions refer to changes in companies’ practices. Philippe Semenowicz concluded on the importance of changing the institutional context to enable the conventions to operate.

  • Betty Espinosa (Faculty of Social Sciences, Ecuador): “Community tourism in Amazonian Ecuador: economics of convention Perspectives”

This contribution aimed to analyze tourism practice in Ecuador, an important lever for economic development, through the prism of the economy of conventions and by borrowing from the sociology of action regimes as well as the notion of formatting advanced by Callon and Latour. Tourism practices, captured through commercial offers, point to a dilemma between the enhancement and endangering of cultural heritage. Tourism was approached here from the perspective of quality standards and the standardization of tourism management. The work is based on two cases highlighting a plurality of tourism practices. The first practice refers to an offer of services provided by a group of indigenous people; the second, to a service managed by an NGO. While the first one plays on the register of “the authentic experience”, the last one highlights the question of the “fair price”, inducing a tension between economic and social management of the tourist service. Finally, this presentation highlighted an unstable juxtaposition between different conventional worlds, but in which the commercial world remains central.

Session 3/3: Political, monetary and financial conventions
Discussants: Franck Bessis (University of Lyon 2) & André Orléan (EHESS)

  • Charlotte Bellon (IEP of Rennes): “The economics of conventions between science and politics: what possible crossovers?”

Charlotte Bellon presents an application of the theory of conventions, and in particular the sovereignty of money, to politics. Politics is understood, in fact, as a process of struggle for power, as a set of actions, and as a set of institutions. This work highlights the proximity of this latter political conception to monetary characteristics, referring to sets of entities that support power functions, sets of collective choices and symbolic assertions of inclusive units. While this work distinguishes monetary and political logics, the notion of sovereignty makes it possible to bring them closer together, particularly as in their function of equity accounting and prioritization. Charlotte Bellon thus underlines the ambivalence of the sovereign currency, stretched between trust and violence, giving rise to cognitive dissonances. Finally, these reflections lead Charlotte Bellon to propose a dialectic of three orders: political (organized by a principle of freedom), monetary (power/wealth) and productive (property). These are located in a more or less differentiated space and governed by more or less horizontal relationships. This framework makes it possible to think of the relationships two to two of these three orders: the tension between sovereignty and rules in the relationship between political and monetary orders; the tension between publicizing the relationship between necessity and emancipation in the relationship between political order and productive order; and finally, the tension between general equivalent (currency as value) and differentiation (currency as a medium of value) in the relationship between monetary order and productive order.

  • Evan Bertin (University of Paris 13): “The impact of the financialisation of companies: thinking about the asymmetry of valuation powers in favour of shareholders”

Evan Bertin presents part of his thesis work, which deals with the impact of the financialization of companies on work. The use of the notion of “valuation power” in companies, i.e. the ability to say what matters and what does not, in a given context, make it possible to address asymmetries in the business world. In this respect, the increase in the capitalization of companies appears less as a refinancing mechanism than as a takeover by the company of its decision-making sovereignty. By mobilizing Olivier Favereau’s work on the different regimes of normativity and intersubjectivity, Evan Bertin highlights the prevalence of short-term logic favored by a particularly favorable regulatory context in France. Maximising shareholder value has effects on working conditions (deteriorating social relations at work) and employment levels, in particular through downsizing practices.

  • Guillaume Dupéret (Mines ParisTech): “The manipulation of Libor, a convention been financial actors “

Guillaume Dupéret discussed the conventional dimension of strategic financial interactions, and in particular the calculation of LIBOR. This interbank refinancing rate is defined as the average of the broker reports of a sample of 16 major global banks. If this principle is justified by the practical knowledge of market operators, it potentially gives rise to strategic declarations. Guillaume Dupéret relies on the Lewisian conception of conventions, and in particular on its updating in the new edition of “Conventions”. In particular, it mobilizes the counterfactual dimension of agreements (regularity as an alternative to the agreement in place and which could have existed) to highlight the logic of actors prevailing in the small world of traders involved in LIBOR manipulations. It shows that in addition to the logic of reciprocity of interests, there is also a symbolic logic of compensation that allows the community to be structured on standards of manipulation and goes through a distancing of the conventional rules of behavior, which are commonly accepted. Finally, this work makes it possible, based on an analysis of individual strategies, to highlight the cultural dimension of the practice of interest rate manipulation.

The plenary session ” The future of French schools of thought in economics “

The theme of the conference invited us to look to the future: the future of the economy, the future of the discipline.

Guillemette de Larquier (University of Lille)

Version française

During the AFEP-IIPPE conference, a plenary session with 7 researchers was organized on the theme: “The future of French schools of thought in economics”. I presented the perspective of the economics of convention. To be interested in the future implies to train students. However, when a student wishes to familiarize herself/himself with the economics of conventions (EC), it is impossible to give her/him a reference to read that would go around it. There is of course ”On justification. Economies of worth” (2006, French “De la justification. Les économies de la grandeur”, 1991) by Luc Boltanski and Laurent Thévenot, but the book is difficult to access and does not represent the whole of what the EC is. Moreover, there is a risk: the typology of domestic, industrial, commercial, civil and other cities can be attractive because it is very effective in qualifying a plurality of coordinations or organizations, but it can be applied in a “flat” way in works that remain descriptive, neglecting the demanding axiomatic of the authors’ project. Moreover, we could also recommend to this student a contemporary work, also founding but less quoted, the book of Michael Storper and Robert Salais “Worlds of production” (1997, in French “Les mondes de production, 1993 by Robert Salais and Michael Storper). In fact, as an introduction to EC, why not simply read (and have students read) the introduction to the proceedings of the 2003 “Conventions and Institutions” conference published in 2006: “Value, coordination and rationality: three themes related by the Economics of Conventions”, a text signed by François Eymard-Duvernay, Olivier Favereau, André Orléan, Robert Salais and Laurent Thévenot. By mobilizing three concepts – value, coordination and rationality – this text defines the main principles of the “conventionalist economics program”, in their own terms. Coordination and rationality totally anchor the EC in the economic discipline; at one time, it may even have seemed that the EC was mainly seeking to dialogue with the mainstream economy by keeping a common language, proposing another rationality to solve coordination problems. In other words, EC remained on the side of methodological individualism – certainly complex – but without any real breakthrough assumed by other institutionalist currents. However, the break is in the first term: value. The rationality of an agent is not “complete” and oriented towards her/his subjective preferences that cannot be discussed; the actors base their reasoning on values external to them, collective and plural entities, that justify or criticize. The theory of action that the EC proposes is at odds with mainstream economics and dialogue with other institutionalist currents in economics but also with economic sociology (for example in the German-speaking world) when it comes to studying how actors act in particular situations through collective conventions, interpretative frameworks, which are materialized in rules, devices and tools. The interventions of the AFEP-IIPPE conference in Lille that were part of the EC were in this vein and foreshadow a bright future for EC – in particular, those of the young researchers from the three sessions presented above, but also those programmed in various thematic sessions. The future of EC appeared in the form of applied, and even empirical, work studying the devices, tools, rules of the capitalist economy, going beyond the pure description of facts to reveal the underlying values of the actors (and not only their interests), leaving room for criticism and controversies of the actors towards the powers of valorization and, finally, practicing an interdisciplinarity or a mix of fertile institutionalist theories.

All in all, the AFEP-IIPPE conference offered some more presentations, based on or referring to convention theory. The interventions related to EC outside the mentioned special “youth” sessions have been offered by:

  • Philippe Batifoulier and Victor Duchesne (University of Paris 13): The State as police of the market: the case of the construction of the health insurance market
  • Franck Bessis (University of Lyon 2): Microsimulation models in action
  • Christian Bessy (ENS Paris-Saclay): What has contemporary economic sociology learned about markets?
  • Rainer Diaz-Bone (University of Lucerne): Convention theory and big data
  • Florence Jany-Catrice (University of Lille): Conflicts in the calculation and use of the price index: the case of France
  • Kota Kitagawa (Kansai University): Valuation Devices of Beneficiary Transformation in a Service Process
  • Guillemette de Larquier (University of Lille) & Géraldine Rieucau (University of Paris 8): Recruitment, conventions and segmentation. Lessons from the OFER survey (2015)
  • André Orléan (EHESS): The contribution of the self-referential hypothesis to financial market theory
  • Junya Tatemi (Osaka City University) & Taizo Yamamoto (Osaka Sangyo University): Intermediaries and design: Valuation process of the local products in Japan
Gala diner in the City Hall of Lille

The conventionalists’ presentation at the AFEP congress demonstrate that convention theory (EC) entails many younger researchers heading for their academic future. Also, the conventionalist movement has presented not only as a French movement but as an international scientific and interdisciplinary movement. AFEP as scientific organization has proven to be one of the promotors and platforms for ongoing conventionalist research, engaging many young and established researchers in the field.