The financialization of the global economy has moved to the forefront the question of how transformations at the level of (financial) markets are related to a wider alteration in patterns of accumulation and circulation of value – a translation problem often papered over more than solved by invoking Polanyi‘s concept of „dis-embedding“.
There is, without doubt, relatively wide agreement that the changes we have seen at the level of markets – specifically, their increasing technologization and epistemization – are linked to the increased self-referentiality and virtuality of financial value and markets, and thus (presumably) also to the financialization of the economy more widely.
However, the precise nature of this link is anything but clear. From the market perspective, it is often accounted for as resulting from the increasing disentangling of economic calculation from non-economic grounds of valuation – producing hyper-rational, mimetic, and purely self-referential market dynamics. More recently, valuation studies have attempted to extend this largely implicit line of reasoning by paying more attention to how processes of valuation establish links between the play of prices within markets and their „embedding“ in wider regimes of value or valuation, thus potentially providing a link to the more structural dynamics described by (political) economists under the heading of financialization.
While this provides a promising line of inquiry, most existing research perpetuates a tendency to separate the analysis of the market frame and the analysis of structural transformations of the (economic, financial) system as a whole. As a result, the translation problem has been shifted, but not solved.
This paper seeks to bridge this theoretical and empirical gap. It identifies as a key problem in the performativity literature (and subsequent literatures) the tendency to focus on the inside of the calculative space of markets, neglecting the ways in which performing the inside also simultaneously performs an outside. Any way of enacting a particular calculative space thus also positions this space in a particular relation to a wider ecology of other markets, thus (potentially) altering the system configuration and dynamics it generates.
Focusing for a first stab at the problem on financial markets, I show that it is insufficient to pin structural transformations of value circulation on generic shifts in markets such as their „technologization“ or „epistemization“ and the increasing degree of „disentangling“ from non-economic grounds of value. As an alternative, I draw on Harrison White‘s widely cited but less frequently employed conception of markets and on work from linguistics to show the construction of meaning within calculative spaces necessarily entails and is shaped by the context that is implicated by the inside configuration. As a result, the internal set-up also affects how markets enact their environment, thus altering the structures of the wider ystem of circulation of which they are the constitutent parts. I use the well-known case of the Black-Scholes / Capital-Asset-Pricing-Model calculative space to demonstrate how their employment in financial markets not only disentangles prices from social bases of valuation, but radically transforms the ways in which financial markets relate to one another.