Monday 30 January 2012
Dr Elder-Vass began by claiming that economists spend surprisingly little time thinking about what a market actually ‘is’. The problem of what something actually ‘is’ is the focus of the philosophical field of ontology. Correspondingly, the study of what ‘is’ in the social realm is called social ontology.
Dr Elder-Vass structured his seminar in three parts. First, he discussed an interpretation of ontology. Second, he discussed a social ontology. Finally, he applied this social ontology to markets.
He began by giving an account of causality. In it, events are caused by interacting causal powers. These ‘powers’ are emergent properties of entities. An emergent property is an attribute that a collection of objects only has when it is combined in a particular way. He gave the example of a torch. Together, the bulb, the battery, the lens and the other components give the torch the power to shine. Individually, none of the parts has this property. The power to shine is an emergent property. Put another way, the torch is more than the sum of its parts.
He noted that this philosophy, in which properties are emergent, is not consistent with the view of mainstream economics, which he described as reductionist.
In the second part of the seminar, by applying this model to the social world, Dr Elder-Vass explained his social ontology. His stated goal was to ask the following questions: ‘What entities exist?’, ‘What powers emerge?’, and ‘By what mechanism do they emerge?’
He discussed one of the entities that exist in his model: the norm circle. He explained that this is an example of what sociologists would refer to as a normative social institution. Norm circles are composed of people who enforce the norm’s rules (the people correspond to, for example, the battery and lens of the torch example). He gave the example of a norm circle composed of students who want to uphold the norm of quietness in a lecture theatre. Norm-circle members will shush a noisy student because they have the backing of other group members. This influence gives the group emergent causal powers.
In the third part of the seminar, Dr Elder-Vass looked at markets from a social ontological perspective. He said that his project was to examine the motivation, mechanism and strategies that are present in markets. He stated that exchange is fundamentally institutional. This means that it is not meaningful to think of exchange taking place outside a social context because exchange of property is equivalent to the exchange of property rights. Property rights only exist because of social institutions. As a consequence of this, exchange can only take place in a social context.
Dr Elder-Vass gave an example of a mechanism through which exchange can occur: preferential attachment. This occurs when a buyer’s strategy is to develop an attachment to a seller because of convenience, a social relationship, or risk-reduction. The seller’s strategy is, simply, to seek buyer attachment. The effects of this strategy include a stabilisation of price differentials. For example, a consumer might continue buying shirts from a local retailer with whom she has built up a relationship, rather than shop at a cheaper chain store. This allows a price differential to stabilise.
Dr Elder-Vass concluded by describing an economy as a set of events produced by the interacting causal powers of people, organisations and markets.
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