Market Intermediaries

Valuation Studies 1(1) 2013: 83–117
The Power of Market Intermediaries:

From Information to Valuation Processes
Christian Bessy and Pierre-Marie Chauvin
Abstract
Sociology and economics tend to focus more and more on the intermediaries
involved in economic and social relations, in the shape of distributors,
matchmakers, consultants, and evaluators. Once they are distinguished
according to their forms, their types of intervention and their effects, the
intermediaries are a helpful category in order to study the social organization
of markets as well as the changes that operate on them, especially regarding
the social and economic values of goods, individuals and organizations. We
discuss in the first section the link between intermediaries and information,
through an analysis of the functions they fulfill that may explain their
emergence, as well as the opportunistic behavior of intermediaries in relation
to information flows. In the second section, we adopt a more pragmatist
perspective on issues of valuation mainly based on ”economics of
convention”, which emphasizes the collective dynamics of valuation. We show
how intermediaries contribute to define valuation through their different
activities and foster valuation frames that can improve the coordination of
actors, but also reorganize the markets in different ways. We suggest an
analytical distinction between the distribution, the temporality and the
generality of the frames, and raise the issue of the valuation power of market
intermediaries, their legitimation and the eventual regulation of their activities.
Key words: intermediaries; market; valuation; evaluation; convention;

regulation
Sociology, economics and political sciences are becoming more and

more interested in the “intermediaries” involved in economic, political,
and social relations; these may take the form of organizations, service
providers, experts, prescribers, and appraisers, as well as technical and
Christian Bessy, ENS Cachan / IDHE, 61, avenue du Président Wilson, 94235
CACHAN Cedex, FRANCE, [email protected]
Pierre-Marie Chauvin, Paris-Sorbonne University / GEMASS, 28, rue serpente,

Maison de la Recherche, 75006 Paris, France, [email protected]
© 2013 Christian Bessy and Pierre-Marie Chauvin

LiU Electronic Press, DOI 10.3384/vs.2001-5992.131183
http://valuationstudies.liu.se
84 Valuation Studies
administrative mechanisms. This trend is a response to the changes

impacting a reality that is more and more structurally complex, and in
which the heuristic value of traditional categories and distinctions
(state/market, individual/society, producer/consumer, etc.) is declining.
This takes place within a configuration characterized by the increasing
international circulation of goods, the liberalization of many activities
and the encouragement of competition, as well as by the development
of forms of organization by project (Boltanski and Chiapello 1999).
These are all developments that currently offer multiple opportunities
for intermediation. Remaining at this level of generality could lead to
describing contemporary society as an “age of intermediaries.”
However, this general term covers entities with heterogeneous
identities, roles, and impacts, which we differentiate here by analyzing
and comparing research that has been devoted to them.
The economic activities of the intermediaries examined here consist
in services relating to their participation in the construction,
maintenance, or expansion of a market. We set focus on professional
intermediaries considered as “third parties”, which intervene between
the so called “supply” and “demand”, and whose actions have some
effects on the economic or symbolic value of a product or an
organization. Beyond the figure of the “auctioneer” traditionally
acknowledged by the standard economic theory, we can identify four
main types of intermediaries which are more or less linked to the
supply or the demand side: the distributors that buy and resell
products, the matchmakers that put into contact partners of exchange,
the consultants that produce advice to their clients (generally from the
“supply” side) and the evaluators that evaluate products, individuals
or organizations. Each type of intermediary can potentially be involved
in the activity of valuation (Dewey 1918), as well as being mixed in
the “real” economic life. Following Dewey, we consider value as a rich
empirical and observable fact that can take many forms (price,
aesthetic value, reputation, status), and generally be defined as a
“quality” attributed to an event, a situation, an object, an organization
or a person, under some specific circumstances and with certain
consequences. This pragmatist approach will lead us to focus more on
the activity of valuation than on value itself and to observe which
actors are decisive in the construction of economic and symbolic
values on markets. Our main hypothesis is that intermediaries are the
actors who, beyond their apparent specific function (providing services
of buying and selling, matching, advising and evaluating), are all
engaged in activities of valuation that shape the market.
It is an empirical question to know to what extent each particular
intermediary carries out each kind of activity (selling, advising,
matching, and evaluating) and to what extent its activities involves
valuation. In other words, the so called “evaluators” (the fourth
category in our typology) are not the only actors that produce
The Power of Market Intermediaries 85
valuations on markets, and the open definition of intermediary will

help us show how (and what kind) of valuations are produced by these
different types of intermediaries. If valuation can analytically be
divided into the activities of evaluation (producing a judgment by
assessing the value of something) and valorization (adding value to
something), these two activities are often mixed in social processes of
valuation (Beckert and Aspers 2011; Muniesa 2011; Vatin 2009).
This paper aims at discussing research belonging to two
traditionally separated disciplines: economics and sociology. Aside
from the development of interdisciplinary research, namely in the field
of the so-called new economic sociology (Granovetter 1985; Swedberg
2003), few works simultaneously take both disciplines into account,
while tackling the question of intermediaries. This cross-fertilization
will allow us to highlight their active role in the dynamics of markets,
through networks, cognitive frames, and valuation processes,
traditionally studied by sociology, without neglecting the issues of
coordination, calculus, and information, which are more analyzed by
economics. This cross-approach has recently been adopted by the
“actor-network theory” and the French school of “economics of
convention” (“Economie des conventions”) which both raised the
question of how to create calculative devices which are competed in a
“market for evaluations”. This is in line with a widely shared
statement saying that the market is not only the aggregation of a large
number of singular transactions but also the frame defining the rules
and the format of those transactions (Beckert 2009; Fligstein 2001;
François 2010).
In pursuing these considerations, we seek to develop in this article
the argument that intermediaries are not only platforms for putting
economic partners into contact, but also active entities involved in the
construction of markets and the dynamics of valuation that drive
them.1 Hence, our preoccupation is not only the role of intermediaries
in making goods calculable and in matching supply and demand, but
also their impact on the cognitive categories and the values that order
goods, people and organizations on markets.
To address these questions, we need to start by reviewing the
emergence of intermediaries in economic research, a phenomenon that
reflects a new understanding of information flows in markets. Thus, in
the first section we discuss the link between intermediaries and
information, through an analysis of the functions they fulfill that may
explain their emergence, as well as the opportunistic behavior of
intermediaries in relation to information flows.
1 This argument is also present in some recent works in political science, such as Nay
and Smith (2002), who highlight the active role of political intermediaries in
matching and formatting “institutional worlds” (instead of “markets” in the
economic sociological approach).
In the second section, we adopt a more pragmatist perspective on

issues of valuation, mainly based on economics of convention, which
emphasizes the collective dynamics of valuation and, in particular, the
collective construction of criteria or principles of evaluation. Following
this approach, valuations are not reduced to the resolution of
information asymmetry problems, but raise the question of the
definition of the relevant criteria used to judge or estimate. In the
neoclassical approach of information search, these criteria are
predetermined and remain unquestioned. Hence, the process of
collective learning that leads to the relevant criteria is not taken into
account.
Our position is that the two approaches are complementary in the
study of the role of market intermediaries, even though the methods
and the behavior hypotheses are different. Indeed, most economic
approaches try to explain why intermediaries exist (by contrast with a
purely individual information search in an anonymous market), why
they differentiate themselves (“marketmakers” versus “match-
makers”), and why they can have a social efficiency. The move
operated by economics of convention consists in a focus on the social
relationships and dynamics that underlie the shared definition of
valuation criteria, but also on the tools, devices and moral values that
support the way economic actors and objects are valuated and
qualified. As other pragmatist approaches, economics of convention
leads to an extension of the list of (human and non-human) actors that
participate in the construction of markets or “commercial channels”.
Our argument is that among these actors, intermediaries play a key
role in the construction and/or the destabilization of these markets,
due to their valuation power, and through their power of mediation
between different logics, principles or worlds.
Int er mediar ies and Inf or mation: S trat egic Functions

and Coordination
How is the concept of intermediary situated with respect to traditional
economic theory? Standard economic theory is based on the figure of
the “auctioneer” whose primary function is to determine a fair price in
the market. This fiction relies on the strict assumptions of the model of
“pure and perfect competition.” Questioning the assumption of
complete and symmetric information has led to a renewed analysis of
the role of market intermediaries and their emergence when
opportunities for productive exchanges have not been exhausted.
Through these configurations we can explain the appearance of new
players aiming to take advantage of market features for personal gain
and to engage in strategic activities, in the way Adam Smith pointed
out in The Wealth of Nations.
After Smith’s prefiguration, the elaboration of the role of
intermediaries constitutes the starting point of the gradual
development of marketing as a discipline distinct from economics in

the early twentieth century. We can refer to the seminal work of Arch
W. Shaw (1912), which analyzed the emergence and rise of middlemen
by focusing on the organization of market distribution. Shaw identifies
the general functions performed by the middleman: sharing the risk,
transporting the goods, financing the operations, selling, assembling
and assorting. As a result of the development of functional middlemen
(insurance companies, direct transportation companies, banks), the
author pays more attention to the function of selling (the
communication of ideas about the goods) and the function of
assembling and assorting, by analyzing the advantages to recourse (or
not) to a middleman.
At the same time, marketing research has focused on the behavior
of the consumer and, after the fifties, on how firms may seek to
regulate demand by defining the target market or defining the optimal
channel of distribution (Laufer and Paradeise 1982). Nevertheless, an
author like Philip McVey (1960) criticizes the notion of “channel of
distribution” in which manufacturers can easily choose between
middlemen of many types and control them. Conversely, he analyzes
channel-building from the standpoint of the middleman’s relative
capability of choice, while serving as purchasing agent for his
customers rather than as selling agent for the manufacturer. From this
more active approach to the role played by middlemen attached to
their current customers group, McVey emphasizes the way they build
some unusual product combinations or packaged assortments well-
fitted to individual customers. In certain cases, the strength of the
middleman is so great that it becomes impossible for a manufacturer
to tap the market.
The emergence of intermediaries in the contemporary landscape of
economic theory was first seen in research on labor markets, with the
recognition of imperfect information (Stigler 1962). The presence of
market intermediaries reduces the costs of the acquisition of
information and, from a more institutionalist perspective, the
transaction costs of negotiating and enforcing contracts (Williamson
1985). In the early 1960s, Stigler (1962) renewed the neoclassical
economics tradition by emphasizing the costs of searching for
information on the labor market. Searching is costly for both workers
and employers, and in his view the raison d’être of employment
agencies arises from the imperfect character of the information that
both sides can gather. More specifically, the concept of “asymmetrical
information” was subsequently introduced into the study of other
markets (Rubinstein and Wolinsky 1987, discussing financial
intermediation). In particular, mention may be made of the second-
hand goods markets, and Akerlof’s famous article on the market for
“lemons” (1970), in which product certification (which can be
conducted by market intermediaries, among others) makes it possible
to solve the problems of so-called “adverse selection” and therefore to

avoid the gradual decline in the “quality” of goods offered for sale.
Thus, information imperfections are at the basis of economic
models of intermediation that argue for the cost-effectiveness of an
intermediary in a market.2 According to these models, the existence of
intermediaries is a response to deficiencies in the market, or possibly
an attempt to exploit these deficiencies. In the latter case, we can
highlight their strategic intent. But empirical observation shows that a
variety of intermediaries exists, which need to be differentiated in
terms of the characteristics of the transactions concerned, and in
particular by the level of uncertainty that surrounds them and that
may call for the establishment of strong mutual trust between
exchange partners.
Responses to the Under-Investment in Information by Economic

Agents
The most common and simple idea present in the economic literature
states that intermediaries, by setting prices and clearing market,
providing liquidity and immediacy, matching and searching,
guaranteeing and monitoring transactions, provide the underlying
microstructure of most markets (Spulber 1996). We focus here on the
two last functions assumed by intermediaries.
Matching and Searching

According to Autor (2008), discussing the labor market), if one
believes that the proper functioning of a market is a public good that
provides utility to both buyers and sellers, an outcome to be expected
in a decentralized economy is one of under-investment on the part of
economic agents in the production of this good. Individual agents
cannot (or choose not to) bear the costs necessary for the production
of perfect information, the result being substantial periods of search in
the market (with the uncertainty that the search efforts of the agents
may not result in a match) and problems of “adverse selection.”
Another source of inefficiency is the positive externalities that exist in
the matching process. Indeed, an increase in the search intensity of one
agent increases the probability of a match, hence the payoffs to the
other agent who does not bear such information search costs. These
2 Another function of an intermediary is to coordinate the actions of members of a

congested market. A current of economic literature has developed around the work
of A. Roth (1994) who is interested in different labor markets in which a problem of
coordination arises between employers and graduates of the university system
(physicians, law clerks). Drawing upon the studies of Roth (2007) on kidney
exchange clearinghouses, the work of P. Steiner (2008) on organ gifts shows all the
complexity of such singular matches and the importance of social relationships in the
working of such kind of an “arena”.
different inefficiencies could give rise to at least two kinds of

intermediaries (Yavas 1992): “marketmaker” and “matchmaker”,
although there is considerable overlap in terms of the functions
assumed by both.3 In different markets (stock, real estate, technology,
used-car, and in a certain extent the labor market), the middleman can
use “sell and buy” orders (as a matchmaker) to extract information
about the demand and supply in the market and can use this
information in choosing ask and bid prices (as a marketmaker).
Guaranteeing and Monitoring Transactions

As Stigler (1962) has focused on, information search does not only
concern prices (distribution of wages) but also information on quality.
Heterogeneity of quality leads to a consideration middlemen as experts
or guarantors of quality. In his model, Biglaiser (1993) draws on the
situation analyzed by Akerlof (1970), but restricts it to used durable
goods, for which the buyer bears very high valuation costs. This
justifies the use of a middleman who has invested in the relevant
expertise and whose investment can be amortized by frequent
transactions. The expertise gained by these intermediaries makes it
possible to reduce valuation costs and can thus lead buyers to employ
them in a cumulative process. We may note that in this model the
expert has an incentive not to cheat by offering poor-quality goods,
since the assumption is made that the expert’s reputation is at stake.
Biglaiser extends his model to retail and wholesale intermediaries
which can offer many different products for sale. Consumers can also
rely on the reputation of the intermediary without having to
investigate the many product suppliers.
Specialized intermediaries can also reduce the problem of “moral
hazards” in markets. As shown by Spulber (1996), when the actions of
buyers and sellers are costly to observe, intermediaries provide
monitoring and contracting services. For example, wine brokers
intermediate wine exchanges between wine growers and merchants, or
between merchants and merchants. They can earn returns through
delegated monitoring by supervising suppliers for their customer. They
also intervene as mediators who can help parties to adjust and solve
conflicts (Baritaux et al. 2007).
Even though we focus on human intermediaries, one may notice
that technological changes create new opportunities for intermediaries
to exploit imperfect environments in which buyers and sellers meet,
3This hybridity among marketing firms has early been underlined by McVey (1960).
That raises the issue of their classification and statistical representativity.
match, and negotiate.4 From this point of view, the development of

information and communication technologies (ICTs) promotes the
emergence of intermediaries that enable market actors to reduce the
costs of information search, including the costs of identifying potential
partners. For example, the main function of job boards consists in
posting job advertisements and building curriculum databases. Thus,
internet-based labor market intermediaries allow multiplying job
seeker/employer interactions (Marchal, Mellet, and Rieucau 2007).
Distinguishing between Intermediaries in terms of Transaction

Characteristics
With a more institutionalist perspective, transaction cost economics
(Williamson 1985) focuses on contractual problems arising from the
management of the relationship between intermediaries and those who
make use of their services. This approach leads to a distinction
between intermediaries in terms of characteristics of transactions (such
as the level of specificity, uncertainty, etc.) that have implications for
the costs of measurement (the identification and evaluation of
characteristics, and negotiation) and respect for “property
rights” (compensation, resolution of disputes, and penalties). We only
present here the functions of matching and valuation assumed by
intermediaries, reminding that this approach has developed a wide
literature on channels of distribution and in particular on franchising.
Following this perspective, Bessy and de Larquier (2001) have
sought to model two types of matching, using the case of the labor
market: standard matching, where the expectation of its ex post
quality is highly reliable, based on knowledge of standard criteria
shared by all participants in the market, and specific matching, which
is more exposed to the hazards of the subsequent discovery of the level
of quality which is subject to unique characteristics. If the matching is
standard, an extensive search for information guarantees its quality,
but if the matching is specific (or risky), intensive search is needed
because a look at standard criteria of two potential partners may make
them appear equivalent. One can thus distinguish between
intermediaries who link together the standard supply and demand of
qualities (or skills), and those who offer their clients the cost-
effectiveness of their ability to assess the “potential” of products (or
individuals). These two reasons for the intervention of intermediaries
(the facilitation of encounters and the assessment of quality) are linked
4 By studying prominent digital intermediaries, a current of economic literature show

how ‘two-sided platforms’ provide a technology for solving externality issue in a way
that minimizes transaction costs. In these businesses (for example software
platforms), pricing and other strategies are strongly affected by indirect network
effects between the two sides of the platform. Indeed the pricing structure rebalances
costs between the two sides by internalizing the indirect externalities (Hagiu 2007;
Evans and Schmalensee 2005).
to the degree of specificity and thus of risk in the matching process.

This result implies that the market of intermediation is a segmented
one, with some intermediaries seeking to differentiate themselves from
the rest by means of a specific niche area of activity in which they will
acquire a potentially significant expertise.
A similar analysis can be applied to “technology markets” and
especially to the market for patents and licenses, which is characterized
by high uncertainty about the value (or the ‘strength’) of intellectual
property rights (IPRs) (Bessy 2006). In the case of “strong IPRs,”
where private actors envision increased possibilities for exchange
between buyers and sellers of patents, they can position themselves as
“license agents,” participating in the development of the technology
market by reducing transaction costs. Conversely, weaker IPRs
increase the contractual risks and make it unlikely that a real
technology licensing agent will become involved. Businesses will
instead resort to alliances in the form of joint ventures. This can lead
to the involvement of other intermediaries who facilitate alliances
based on technological cooperation, by reducing the risk of
opportunistic behavior.
The transaction costs approach allows distinguishing the activity of
intermediaries according to the degree of specificity of the assets
underlying the transaction. But its under-socialized vision of economic
exchange leads to study the activity of intermediaries as a succession of
calculation processes. This approach overlooks the way this activity is
oriented by rules of interaction defined in reference to groups or relies
on personal networks providing actors with credible information.
The Go-Betweens: Trusted Resources for Innovative Activities

The intermediaries analyzed in these various studies may be specialized
agencies whose primary activity is bringing business partners together
and evaluating quality, or other organizations carrying out mediating
activities secondary to some other primary activity. In these situations,
the activities are generally combined to benefit from economies of
scope. In the case of technology markets, those involved may be banks
or venture capital companies, consulting and technology transfer
agencies, professional organizations, law firms specializing in

corporate law,5 or firms in some other sector.
With respect to the labor market, professional organizations can
also play a role as recruitment and training intermediaries (Bessy and
Marchal 2009). But actors further removed from the workings of the
labor market may also be involved in hiring, within the frame of their
innovating activity. Research by Chauvin (2010b) on Bordeaux wines
has shown, for example, how consultants in the wine trade who
initially intervene with the goal of improving the quality of the wines
may also be asked to do some recruiting for the wine producers. One
can also quote the example of software engineering companies, who
may approach talented young people with very specific expertise on
behalf of their clients (Bessy and de Larquier 2001). Beyond the
immediate reduction in the costs of recruitment, they guarantee the
ability of these candidates to develop innovations in areas with a high
degree of uncertainty, because of their own reputation as experts in the
field. These temporary intermediaries are trusted resources, and it is
important to examine more generally how this trust is built up.
The work of Nooteboom (2000) shows how important the go-
between is in creating innovation-oriented alliances. This analysis can
be extended to the search for partners in any business project, where
each party needs to be sure of the “quality” of all the others. Beyond
the claims of transaction cost economics about the role of arbitration
by a third party in resolving disputes, Nooteboom presents a series of
additional arguments. The intermediary can assess the relevance of the
information transmitted by each party to the transaction and then
inform each one separately in such a way that none of them reveals
what they know to any of the others. This makes it possible to control
the dissemination of information. Moreover, the intermediary can help
build mutual confidence early in the cooperation process, due to the
transitive character of trust relations. It may also help to end the
alliance by making it more progressive.
These temporary intermediaries are hardly taken into account by
the “search approach” in which economic agents make a rational
calculus of information search, in particular in order to assess the
option of trading through a middleman. Now it happens that a large
5 Suchman (2000) has shown how the corporate law firms in Silicon Valley have
substantially contributed to its development, not only through innovations in
contract matters (funding of software companies by venture capitalists), but also by
providing guarantees of the quality of the parties concerned, and even by putting
them into contact. These “local intermediaries” are consultants, disseminators of
contractual and informal standards, gatekeepers, and matchmakers. This type of
actor is on the fringe of the category of market intermediary, because it is not
lawyers’ primary function to create matches; however, they contribute largely to the
construction of the venture capital market that finances high-tech companies, and to
the related law market, building on their reputation within networks of social
relations.
share of exchange opportunities are the by-products of other economic

activities or result from people being embedded in on-going networks
of interaction oriented towards economic and non-economic goals
(Granovetter 1995).6 Such an intermediary can put different networks
in touch with each other, thus counteracting excessive narrowness,
which can make networks rigid and too closed. Beyond innovative
activities, personal networks provide actors with credible and
trustworthy information in markets in which there is no obvious
device to judge quality (Karpik 2010).
The Strategic Behavior of Intermediaries

With a more strategic perspective, one may find the argument for the
strength of “weak ties” (Granovetter 1973) in the theory developed by
Burt (2000) concerning the “network entrepreneur”. He shows how,
in a world where information plays a vital role in the accumulation of
wealth, informational advantage can be obtained by connecting
entities that were previously separated (the “structural holes”). Burt
adopts Simmel’s concept of the tertius gaudens or “third who
benefits,” to describe the role that gives one player the opportunity to
intervene between two others or to play each of them off against the
other. According to Burt, the power of the intermediary consists in the
possibility to control the interactions or the networks of separated
social actors. This control derived from “structural holes” is uncertain
and the power of the intermediary only gives him “chances of success”
depending on the tensions between non-redundant relationships. Burt’s
analysis also explains that “network entrepreneurs” seek to
accumulate reputation advantage through multiplying the number of
links, but only to the extent of being suspected to act strategically.
The lack of powerful reputation mechanisms can give rise to more
“opportunistic” behavior on the part of intermediaries that are
officially recognized in the market. Based on a model developed by
Hart and Kreps (1986) for speculative activity, Lesourne (1991)
distinguishes between intermediaries involved in the proper
functioning of the market (convergence towards a “stable” market in
which all the possibilities for making good matches have been
exhausted) and those whose more strategic behavior is intended to
“destabilize” the market.
Gautié, Godechot, and Sorignet (2005), who have observed the
highly competitive and specialized activity of headhunters in the
executive job market, also emphasize the role of strategic behavior. To
be sure of completing the desired task quickly, the headhunter
preselects one or two “clones” and surrounds them with two or three
6 We may also note that Rees (1966) has particularly emphasized the importance of
networks of interpersonal relationships for guaranteeing the quality of candidates
recruited in the labor market.
atypical profiles; the clients, convinced by this grouping of the scarcity

of the kind of professionals they are looking for, make a decision more
quickly than when faced with five identical individuals—and in favor
of the “clone”. In the same way, in a very competitive context,
headhunting agencies help to partition and segment the market by
creating sets of employment categories, as well as contributing to
salary inflation. Here we see that beyond matchmaking, headhunters
are in a position to fix prices in the market and can act as salary
consultants, helped in this by new information technologies.
We find the same kind of strategic opportunities in marketing
methods. It does seem true that contemporary modes of representation
in advertising create an illusion of exclusivity or of scarcity (Appadurai
1986), but other methods such as merchandising and building
assortment, in which the process of sorting is fundamental, entertain a
more subtle game with categories of products. As Azimont and Araujo
(2007) show from their analysis of category review meetings between
manufacturers of fast-moving consumer goods and retailers, these
actors permanently negotiate the definition of categories of products.
They can also play strategically with these categories by relying on
conventions about consumers’ representations of categories.
Misleading advertising and the sale of counterfeit products represent
the extreme cases (and legally reprehensible) of strategic use of these
conventions and in particular of those on which brands work (Bessy
and Chateauraynaud 1995).
Towards a Pragmatist Approac h of t he Valuation

Power of Int er mediar ies
As the transaction costs economic approach shows, the existence of
quality standards is conducive to the development of the activity of
intermediaries that operate on wide markets. In their absence,
matching rely on more specific forms of intermediation or on the
intervention of experts who bring trust pledges, or on networks of
personal relationships. As we have seen with Burt’s analysis, these
networks of relationships can be instrumentalized by “intermediaries”.
These strategic opportunities not only show the more active role of
intermediaries in market shaping, but also their strategic behavior
relying on conventions about the quality of products (or individuals)
that they have themselves contributed to build.
The purpose of this section is, precisely, to provide a better
understanding of these conventions, the evaluation frames they
underpin, and the role played by the different market intermediaries in
their genesis, diffusion and stabilization. That raises the issue of their
valuation power and their legitimation. Once these conventions
(setting common computing spaces) are stabilized, intermediaries can
play their traditional role highlighted by the economic theory based on
information search, or arbitrate between becoming a marketmaker or
a matchmaker. Hence, this section moves from a view of

intermediaries as informational platforms to a conception of actors
whose effects go beyond mere intermediation in the narrow sense,
covering not only information but also the dynamics of valuation in
the relevant markets.
Since the beginning of the 1990s, “economics of convention” has
demonstrated the crucial role of intermediaries in the functioning of
markets (Bessy and Chateauraynaud 1995; Bessy and Eymard-
Duvernay 1997). Through their activities of search and selection, and
the nature of the relationships they sustain with sellers and buyers,
they contribute to the social construction of markets and to the
dissemination of the conventions or standards of quality that underpin
them. The analysis in terms of “quality convention” allows
formalizing the different processes by which product (or organization)
characteristics can be defined, and as a result limit uncertainty about
the agents’ behavior (Eymard-Duvernay 1989)7 . Thus, the market is
not given a priori, but is constructed by means of “third parties” who
can be more or less stable and institutionalized, and who can structure
various modes of activity or introduce mediation between general
conventions of quality and more local conventions. From an empirical
standpoint, this approach investigates the entire available body of
instruments and mechanisms, and in particular cognitive artifacts such
as the classifications and nomenclatures, advertisements, and
assessment tests used by intermediaries in their daily work, which play
a role that is both cognitive and normative in directing their activity.
This idea is in line with one of the key arguments of the approaches
in terms of “distributed cognition” (Hutchins 1995)8 and “sociology
of translation” or “actor-network theory” (Callon 1986; Cochoy and
Dubuisson-Quellier 2000; Mallard 2000; Cochoy 2002; Callon and
Muniesa 2005). According to Callon (1986, 185), intermediaries take
on diverse forms, generating an activity of intéressement, defined as
“the group of actions through which one entity . . . strives to create
and stabilize the identity of the other actors that it defines through the
way it defines the problem”. In a later paper, Callon (1991, 134)
defines an intermediary as “anything passing between actors which
defines the relationship between them”. They include literary
7 In particular, Eymard-Duvernay (1989) refers to the “orders of worth” distinguish-

ed by Boltanski and Thévenot (2006) in their model of justification of actions in the
public arena. In this perspective, the decision to conform to a given convention is not
reduced only to calculation, but may also consider the legitimacy of the actions
prescribed by this convention, by making value judgments about them.
8 The aim of these investigations is to put forward the distribution of knowledge
among individuals and between them and their socio-physical environment. The unit
of analysis is thus no longer the individual or the social group, but a physical and
cognitive system composed of individuals and the artifacts they employ.
inscriptions, technical artifacts, human beings and money in all its

forms. His general thesis is that intermediaries both order (by
describing) and form (by being involved in relationships) the “medium
of the networks they describe” (Callon 1991, 135)9 . Callon and
Muniesa (2005) especially highlight the effects of such actors on goods
and the way people produce, manipulate and choose them: these
activities imply a series of operations resulting in the “calculability of
the good”. This idea is also developed by Beunza and Garud (2004) in
a stimulating paper focusing on the role of Wall Street securities
analysts as “frame-makers”. These works show that intermediaries are
not only go-betweens or even transformers of knowledge, but are
themselves entrepreneurs in action. They move back and forth between
different social worlds. Far from only transferring knowledge in one
direction, they are engaged in an exchange of knowledge through
moving between places (Meyer 2010). Hence, the word transfer does
not do justice to the practices of knowledge brokers, that can be better
understood with the concept of “translation”10 which implicates an
actual transformation of arrangements of human and non-human
actors.
We want first to highlight how frames of valuation are both used
and created or modified by intermediaries by developing more
precisely the point of view of “economics of convention” on valuation
and intermediaries. Unlike actor-network theorists,11 we will keep the
term “intermediaries” while highlighting the active role they play in
markets, but we will distinguish different types of intermediaries
regarding the type of role they play in such worlds. Then, we propose
a characterization of their power of valuation according to the nature
of the valuation frame they produce, which can be more or less
general/particular, more or less distributed/concentrated, and more or
less durable/ephemeral.
9 He then introduces a “purely practical” (Callon 1991, 141) distinction between

intermediaries and actors by providing different definitions of what an actor is. An
actor is “an intermediary that puts other intermediaries into circulation” (Callon
1991, 141), actors are “those who conceive, elaborate, circulate, emit, or pension off
intermediaries”. In other words, intermediaries are simple links between entities
whereas actors transform the world through the expected and unexpected
consequences of their actions.
10The notion of “translation” has been introduced by Callon (1984), who identified
four “moments” of translation: “problematisation”, “interessement”, “enrolment”
and “mobilisation”.
11 The word “intermediary” itself is criticized by proponents of this theory. Inter-
mediaries do not add anything new or different to the existing state of affairs; they
merely transfer information or knowledge. By contrast, mediators make a difference
via translation processes whose outcome cannot be predicted from the original
conditions.
The Four Types of Intermediaries and Their (Creative) Use of

Frames of Valuation
Every activity of valuation is based upon some “frames”, which are
the (more or less) shared cognitive scheme that organize the valuation
experience. Beyond the empirical and local statements made by some
scholars about the framing role of specific types of intermediaries (such
as Beunza and Garud [2004] about securities analysts as “frame-
makers”), we will show that the four types of intermediaries identified
in the introduction are implied in valuation frame-making and frame-
using activities.
Distributors
Trade intermediaries, traditionally considered as buying and selling
platforms, can be analyzed as entrepreneurs of new models of
distribution that have some consequences on frames of valuation,
which consist more precisely here in the ways products are valorized in
commercial channels. New modes of valorization are often linked to a
material and immaterial framing of the market situation (Kjellberg and
Helgesson 2007; Cochoy 2010) that goes beyond the traditional
marketing activity of targeting customers.
For example, Antoine Bernard de Raymond (2007) shows how
French mass-market retailing is the product of different evolutions that
create opportunities for new intermediaries: the transformations of
traditional retail selling and deep changes in supplying facilities, the
appearance of a global rationality of the circulation of products based
on the optimization of transport flows and a strict packaging chain
with strict sanitary conditions. Frames of evaluation can here be
thought of with the help of Boltanski and Thévenot’s theory of
“cités” (2006), these cognitive worlds in which actors use some
principles of action and justification. In the case of mass-market
retailing, the “industrial logic” is at the heart of the transformation of
traditional production and distribution of goods (based on “domestic
logic”) as shows the passage from “camenbert normand” to
“camembert normé” (Boisard and Letablier 1987) which follows its
mass-distribution by reorganizing thoroughly the logistics (in
particular the way milk is collected) and by redefining the links with
farmers.
The mass-distribution case also shows the proliferation of different
service providers that do not buy or sells the goods (as retailers and
wholesalers do), but various services performed like warehousing,
transports, merchandising, and different kinds of consultancy, which
play a role in the down-stream valuation process of products.
A second example of this active role of trade intermediaries in the
determination of frames of evaluation can be found on the art market.
Art dealers not only assess the value of artists by using existing and
predetermined valuation frames (made by museums or critics for
example), they participate in constructing these frames through their

engagement in the birth of artistic movements, aesthetic conventions
but also “price conventions” that circulate on markets. Velthuis
(2005) shows, for example, that in a social configuration characterized
by radical uncertainty on the quality of goods, intermediaries such as
art dealers are likely to create convention-based prices. These
conventions are linked to specific commercial channels of the
contemporary art market in which dealers share the same conception
of artistic work, and can then coordinate their activities with other
agents of the commercial channel: artists, collectors… Velthuis
identifies three main prices “narratives” or conventions that have been
created and used in the art market since the 1950s: “honorable prices”
stand for the postwar gallery circuit which was confined to a limited
art connoisseurs circle; “superstar prices” are characteristic of the
1980s New York boom in which prices were rising tremendously high;
“prudent prices” account for the more cautious commercial scene in
the late 1990s in which galleries became real “companies”. These
types of prices are cognitive tools that shape the meaning of the
historical development of the art market, but they are also normative
devices that allow art dealers to justify their practices and to compare
with competitors. “Distinguishing different prices is a means for art
dealers to express the values they endorse in their business
life” (Velthuis 2005, 141).
This research highlights the plurality of valuation conventions
within a single market and the fact that some specific frames of
valuation are linked to some specific commercial channels. If
intermediaries are the actors that make this link between commercial
channels and valuation conventions possible, they may combine these
various conventions in some different ways, and foster through their
“friction” or their “dissonance” new valuation forms or principles
(Stark 2009).
Matchmakers
A second category of intermediaries includes the actors that are paid to
put two (or more) different parties into contact. This fundamentally
“relational” activity is not only a question of relationship and flows of
information, it is also an issue of cognitive frames and valuation. A
good example of empirical research is to be found in the work of
Bielby and Bielby (1999) on talent agencies in the American television
market. They show how, in this labor market, “matchmakers” do not
simply bring together television channels and program directors and
producers. Their activities go further by creating “packages” of teams
which include producers, scriptwriters, directors, and actors, in order
to offer turnkey projects to the TV channels.12 Thus, they construct a
singular product by combining resources in an innovative way and
12 This argument is in line with the prior analysis of McVey (1960).
participating in the segmentation of the professional world in which

they operate. Hence, intermediaries’ activities produce categorizations
that contribute to the cognitive segmentation of markets. As we
showed in the first section, intermediaries can play a role in expanding
the equivalencies employed in this categorization and, conversely, by
reducing them so as to create “artificial scarcity” (Gautié, Godechot,
and Sorignet 2005). This strategic way of playing with conventions of
quality is all the more likely to occur if the market is increasing in scale
and the demand-side clients have little expertise in this sphere.
Such an analysis is indeed useful to understand the activity of labor
market intermediaries. Their intense activity of putting partners in
touch leads them to develop valuation frames and categorizations of
jobs and skills, which are all the more used by these intermediaries
than they become stable conventions that allow a plurality of actors to
coordinate with one another. Besides, the reflection about
intermediaries proposed by the “economics of convention” started
with a focus on how conventions of skills are embedded in the
different devices used by the recruiters on the labor market: want
advertisements, tests, graphology analysis, nomenclatures and
classifications of profession (Bessy and Eymard-Duvernay 1997; Bessy
et al. 2001). The studies of the long-term evolution of such devices in
France show that the private employment agencies participated in
valorizing the logics of “skills” and “employability”. This leads to a
valuation of the most general aptitudes of individuals to the detriment
of the collectively negotiated employment classifications in specific
sectors which are considered unsuitable to the new flexible
organization forms (Boltanski and Chiapello 1999).
The search for skill transferability is in line with the possibilities
generalist agencies have of presenting a “very competent” individual to
a wider scope of potential recruiters. The creation and the diffusion of
a new form of categorization or valorization can rely on a critical
work of traditional valuation frames, but also on a more progressive
and incremental process linked to an entrepreneurial, innovative and
lucrative activity. In terms of convention dynamics, job agencies carry
the representations of employers and workers that claim for a
recognition of their individual skills, but they also create and spread
their own valuation tools that contribute to the individualization of
employment relationships. Hence, frames of valuation can be fostered
by different kinds of economic actors on the job market, including
groups of workers, employers, and professional intermediaries. This
case raises two main questions: the question of the imputation of a
new valuation frame to an actor (or a group of actors) and the
question of the collective acceptance by a majority of actors.
According to “economics of convention”, the intermediary is generally
considered as the actor that gives the initial impulse to the valuation
convention, and its collective acceptance may be linked to the social
legitimacy of the convention (Boltanski and Thévenot 2006) or

different kinds of mimetic processes (Orléan 2011). The case of
fashion is a good illustration of these different processes by which
valuation conventions are collectively accepted.
The ethnographic research of Ashley Mears (2011) on fashion
models helps to understand how an “original look” appears and is
valued through a mimetic process. This process is engaged by most
reputed model agents that support some specific types of models.
However, they cannot act only on their own: to avoid a too big price
difference between models, agents often consult each other to set up
“fair” prices, and conventions of prices and looks emerge from their
interactions. This is in line with the argument raised by Velthuis
(2005) concerning the art dealers trying to keep up their legitimacy by
dealing with different commercial and aesthetic conventions.
Moreover, these strategic interactions whether in fashion or in art
spheres, are likely to take place during trade shows.
Consultants
Even when they do not participate directly in some economic
transactions, consultants may contribute to the definition of some
valuation frames for products or job candidates. We can give the
example of the style bureaus of the fashion trend such as it is reported
by Rinallo and Golfetto (2006). These authors show how the material,
cognitive and interactive dimensions of some trade shows (like
“Première Vision”) help conventions (on future styles) to be spread
and valued within the clothing fabric industry, and more generally
within creative industries. At the beginning, these conventions are
issued from a process of discussion between French and Italian
manufacturers considered to be the most innovative. They answer to a
very fragmented textile industry and to the need to reduce the
uncertainty about the qualities of textile products (color, structure,
aspect, touch, decoration, and treatment). This reduction of
uncertainty may improve the coordination between the different
actors. Nevertheless, if the identification of the future trends is
proposed by the internal experts of producers (members of “Première
vision”), the authors point out the crucial role played by style bureaus
in this process. These companies are specialized in trend forecasting
and they operate in different creative industries. They can be
considered as “brokers of language” as they connect material
properties of clothes and symbolic meanings about products. This
connecting activity contributes to the “bodily anchorage” of
conventions (Bessy and Chateauraynaud 1995).
Generally speaking, once they have invested in the design of a
valuation frame, consultants try to spread it within an economic sector
or in different economic fields. A good illustration could be the
consultant agencies in employment and salaries, which set up
definitions of positions that stand for a whole range of companies, at

the least for the biggest ones, in order to establish a salary hierarchy.
Reynaud (1992) showed that this kind of consultant agencies had
to carry out surveys in order to gather information about the salaries
in each company. In order to do so, they have to transform the
information they have gathered into comparable items: the value of
surveys depends on equivalence decisions between positions for which
names differ. Moreover, their clients do not receive passively the
results of the surveys, they adapt their strategies to these results and to
the norms they have contributed to build. By this mechanism, the
activity of consultant agencies has some consequences on the work
organization and the salary practices of their clients, and they
participate in building the economic value attributed to their
employees. Reynaud interprets the role of the consultant agencies as a
kind of “Walrasian auctioneer” that organizes the “tâtonnement” and
that serves as intermediaries between the companies and the market
considered as a set of socially constructed information. We may add
that they contribute to the cognitive segmentation of the market by
creating some new valuations conventions of workers and positions.
These conventions are all the more powerful as they are followed by
the companies that were not in the panel of the survey.
This power of valuation can also be attached to a “signature” that
the consultant uses as a more or less explicit strategic tool. The wine
consultants can for example be valued through their
”oenological signature” (Chauvin 2010b), which recently entered the
repertoire of valuation frames for wines. This signature consists in the
type of intervention in the wine estates (regular/occasional), the type of
public presentation of the consultant (discrete/visible) and the way it is
associated with products (strongly/weakly), and the qualitative style of
the wines he or she contributes to produce. Even though a signature is
a source of reputation that can be transferred to products, it is an asset
that consultants have difficulty assuming because of the importance of
the soil and vintage in the making of reputations in the French wine
industry.
The main question raised by these examples is the imputation of
the responsibility of a particular consultant (or consultant agency) in
the emergence of a new valuation frame or a new category of goods, in
contrast to the case of a distributed building among a plurality of
consultants and other intermediaries.
Evaluators
If the three previous types of intermediaries carry out activities that
have some consequences in terms of valuations, their core activity does
not explicitly consist in producing evaluations, rankings or ratings.
However, we can now identify and analyze a fourth type of
intermediaries whose main activities precisely rely on producing such
devices. There is a growing amount of works focusing on such actors

and their effects, as western contemporary societies can be thought as
audit societies (Power 1999), in which financial, medical,
technological, environmental, quality, and many other types of
evaluations are produced by a set of professionalized actors. Espeland
and Sauder (2007) proposed to conceptualize such actors as “third
parties” that foster some social “reactivities” in the worlds they
evaluate. They especially focus on the third parties in the education
sector, that is to say actors that are neither suppliers nor demanders of
education goods, for example education media. Such actors produce
some rankings that create or reinforce some criteria of valuations
(number of students, number of international scientific prizes,
students’ professional careers etc.) that can become “conventional” in
the field. These conventions of valuation are interiorized by the
majority of evaluated actors, who may modify their organizational and
communication strategy to conform as well as possible to the criteria
fostered by the rankings. This case accounts for the possible
instrumentalization of the valuation criteria by the evaluated actors,
but also for the difficulty to escape from the “discipline” of rankings.
These effects raise the social issue of the negative or “bad”
conventions that are created or spread within the academic world but
also in the financial world (Orléan 2011) and many others.
“Bad” as well as “good” effects of valuations are not necessarily
the product of an explicit strategy and can emerge progressively
through unexpected social mechanisms. The activity of the wine critic
Robert Parker is a good case for understanding how a powerful
evaluator may foster “despite himself” some new conventions and
categorizations on the wine market. If he deliberately created and
spread an innovative format of wines valuation (a 50-100 point
quality scale), he also fostered some more informal and unintended
categories of valuations within this economic world. While arguing for
his “prescriptive” recommendations in terms of the information he
provided to consumers, he assigned points and made judgments that,
once adopted and “interpreted” in the oenophile community, gave rise
to new categorizations, of which he himself may have been a target
(Chauvin 2010a).
The controversial category of “Parkerized wines” is a good
illustration of this, and shows how an intermediary can become the
source of retroactive implementation of the strategies of some wine
producers. The unanticipated effect of the intermediary’s activity in
this case is the producers’ introduction of new production methods
with the goal of improving their standing in the Parker ratings. On a
meso-level, this can contribute to a new configuration of the
conventions of quality in the considered market. This case shows that
the strategic valuation activities of intermediaries are themselves
subject to new interpretations and unforeseen categorizations made by

other market players.
Despite their professional heterogeneity, these four types of
intermediaries share a common characteristic, which is not a substance
or a fixed identity but is based on the dynamics they foster: the power
of valuation of an intermediary can be measured through the effects of
the valuations it produces, whatever their forms or their logics may be.
Intermediaries’ Power of Valuation: Definition, Generality and

Temporality
As long as their role as prescribers is recognized (Benghosi and Paris
2003), market intermediaries can have a prominent part in the
creation and the dissemination of conventions and the resulting
categorization of goods, people and organizations. All intermediaries
do not have a strong valuation power. Generally speaking, power is an
unequally distributed resource, and it is an empirical question to assess
to what extent each intermediary enjoy this specific kind of power.
However, we can suggest some distinctions and analytical tools in
order to identify some important factors that lead to these
asymmetrical situations. At the end of this sub-section, we will also
propose a picture synthesizing the three main characteristics of the
valuation frames and the way they can help to categorize the different
examples of intermediaries referred to in our paper.
The Definition of the Valuation Frame: Distributed versus

Concentrated
As we have already mentioned (concerning the consultants), one may
distinguish two polar cases of the definition of the valuation frame.
First, valuation frames may come from a plurality of intermediaries
that share the same conception of what constitutes the value of a
product. Second, they may result from the activity of a single and
dominant intermediary (a high standard consulting job agency, a
famous flying winemaker, or a reputed model agent) that succeeds in
spreading to his or her clients what is worth or what is valued in a
specific field. So, the definition of the valuation frame is more or less
distributed between different intermediaries.
We can note that in the former case, the power of valuation is often
attached to a professional status that confers a symbolic authority. In
the latter case, the legitimacy of the intermediary may be less stabilized
and protected than the one attached to a professional group, and leads
him or her to make a permanent “reputational work” (Zafirau 2008).
Thus, according to Rinallo and Golfetto (2006), the ability of the
producers in the textile and clothing industry (members of “Premiere
Vision”) to represent the market and to make it real is attributed, in
line with a Bourdieusian argument, to the differences of “symbolic
capital”. This specific kind of capital depends on the particular
characteristics of each market, and is often linked to the temporality of

the “entry” on the market. The first intermediaries who can be
identified and collectively recognized as innovators, can progressively
acquire the legitimacy and the status of “pioneers” and can impose
new trends to the “followers” of the markets.
The Generality of the Valuation Frame: Standard versus Singular

The valuation power of intermediaries can also be analyzed through
the degree of generality of the frames they contribute to elaborate.
First, it seems important to distinguish the intermediaries who
build the market by centralizing and reallocating the information
through standardized categories of quality, and those who generally
act at a local level, every matching being different from the other ones,
according to a negotiation process of the quality that occurs during the
evaluation. This latter case is more interesting to analyze with a
pragmatist approach, as standardized and centralized valuation
processes are by definition less interactional and uncertain in their
progress.
Recruitment processes in the field of highly innovative jobs give a
good illustration of the situations in which the skills of the candidates
or the relevant qualities of the product emerge from an interactive
process of information exchange (Bessy 1997). The client firm and the
intermediary learn from the CV of the candidates the ins and outs of
the job searched and the required skills. The candidates try, from their
part, to profile their experience and their skill according to the
specificity of the potential employer. In this case, intermediaries are
involved in a highly distributed and negotiated valuation process, in
which every actor influences the other one. Commenting the works of
Kreiner (2007) on architecture competitions, Stark (2011) identifies
the same kind of interactive process of redefinition of the principles of
evaluation during the competition process. The projects of the
competitors also serve to better define the real problems that have to
be solved, as well as the operational principles for a successful
performance.
Stark notices that this implies a shift from the resolution of an
analytical problem (for example through the analysis of standard
matching in transaction costs approach) to questions of interpretations
(which could be developed in a conventionalist and pragmatist
approach of specific matching), which can be thought of with the help
of Dewey’s pragmatist approach, according to which the relevant
valuation principles are generally built during the evaluation process.
This more interactional and uncertain evaluation process is likely to be
present in the beginning of the development of a new activity or a new
technology.
The Temporality of the Valuation Frame: Short-Term versus

Long-Term
The distinction between standardized and singular matches can be
completed by a close look at the “temporal” dimension of the
valuation power.
Markets distinguish themselves by combining, differently, various
kinds of temporal valuation frames. In a first perspective, one may link
some particular markets with some specific temporal frames: for
example, the financial market has become a short-term valuation
sphere, according to a vast literature on financial evaluators. Work by
Montagne (2009) shows, for example, how the increased delegating of
investment funds management has contributed to creating a
professional services market (consultants, managers, appraisers, and
rating agencies) and standards methods of scoring and pricing (Beunza
and Garud 2004). Parallel with this standardization, their activity is
likely to entrench the short-term as the dominant economic time-
frame. The increased importance of consultants and various other
intermediaries with the job of measuring performance has created two
kinds of constraint for financial management companies—quantitative
(performance markers) and qualitative (organizational audit)—as well
as systematizing competition. As Montagne states (2009, 8), “the
creation of a market in valuation, affecting both managers and
appraisers, is thus directly responsible for the standardization of
methods of valuation and for their alignment with short-term
investment methods.” Intermediaries are thus not external actors, but
impact directly on the dynamics of valuation by shortening its time-
frame.
A second approach may try to identify how different types of
temporal valuation frames are articulated in the same market and
what role intermediaries play in these temporal “frictions”. For
example, if fashion trends are short-term valuation frames that are
supposed to be renewed each year, one may try to identify how they
are linked with more stabilized valuation frames. On the fashion
market, these frames could be the “names” of the fashion houses
which give a kind of “status depth” to this market, by transferring
their longer, more stable worth to the other “names” or “products” of
the market. On the French wine market, if official classifications
represent long-term valuation frames (in the both sense of stable
frames and frames whose legitimacy is linked to their longevity), they
are challenged by other types of frames, especially the annually
renewed rates given by critics. Intermediaries such as wine critics not
only convey new short-term temporal frames, but they have to deal
with long-term frames (by respecting them and showing they just
produce marginal newness), and they can paradoxically reinforce them
by their work (Chauvin 2010a). Our distinction between short-term
and long-term valuation frames is a schematic way of analyzing the
plurality of temporalities involved in economic worlds. Further work

may take advantage of the important sociological literature which
deconstructs the idea of “time” or “temporality” by identifying the
various forms of temporalities that structure social life (Fine 1990;
Flaherty 2003).
In order to sum up our results, table 1 (below) is an attempt to
classify the different examples quoted until now, according to the
criteria we have used to characterize valuation frames.
Table 1. The classification of examples according to the type of intermediaries and the characteristics of the valuation frames.
Type of intermediary
Distributor Matchmaker Consultant Evaluator
Characteristics of
the valuation frame
Definition: Retail industries, Recruitment

Consultants in
Producers of agencies, Financial raters
Highly distributed salaries
textile Talent agencies
Concentrated
Consultants in Influent wine
Specific art dealers Model agents
winemaking critics
Temporality:
Salary Wine official
Mass-distribution Skills logic
Long-term classifications classifications
Short-term Short-term
Textile and
Original look Trendy products conventions,
fashion trends
Internet bubble
Generality:
Salary
Mass-distribution Skills logic Financial market
Standard classifications
Singular Headhunters in Consultant in Architecture

Art dealers
fields technologies competition
The first criteria, based upon the type of definition of the valuation
frames, concerns actors, whereas the two others (the temporality and
the generality) concern more the valuation frames and their “social
forms”. When we combine the three criteria (distribution, temporality,
generality), we can distinguish between two stylized configurations.
The first configuration involves powerful intermediaries, stable and
standard frames. In this case, intermediaries have a strong power of
valuation because they are at the origin of the definition of the
valuation frames, which are not negotiated in situations and are
persistent over time.
The second configuration consists in less powerful intermediaries,
negotiated and singular frames. In this case, intermediaries have less
power because the valuation frame is defined among many actors,
constantly negotiated and relevant only during the time of the
valuation process. Intermediaries adopt local conventions which
emerge from the valuation process, and none of the intermediaries has
a dominant role. Obviously, there is a continuum between these
extreme cases, along which the various empirical cases could be
distributed. Beyond the examples quoted in this paper, our hypothesis
is that all intermediaries can be located in this kind of table. One may
think of empirical cases such as matchmakers on the “online dating”
market. The websites analyzed by Cornwell and Lundgren (2001),
Bergström (2011) or Kessous (2011) are intermediaries which
participate in constructing the “value” of the potential partners,
through the selection criteria of the partner (age, sex, location, but also
social, cultural and economic characteristics), the type of access to the
different areas of the website, the type of evaluation of previous
partners that can display the members of the website, and the visibility
offered to some particular members who appear on the main page of
the website. If we follow our typology, this kind of intermediary could
be analyzed as a “distributed” case (Bergström studies for example
more than one thousand websites). The two other characteristics of the
intermediaries (the temporality and the generality of the frames they
produce) would probably be “short-term” (because of the frequent
change of the selection criteria displayed by the websites and the
rapidity of the production and publication of an evaluation by
members) and “singular” (because of the specific criteria displayed by
the websites according to ethnic or religious parameters for example).
The analytic fecundity of this typology could be illustrated by many
other examples from different markets.
Explaining and Regulating the Valuation Power of

Intermediaries: Two Challenging Tasks
The characterization of the valuation frames fostered and used by
intermediaries is helpful to understand their activity and how they
shape value dynamics on market. However, it may not be enough to
explain their unequal valuation power, as they do not all have such
effects on their economic world. A few sociological theories can be
useful to solve this problem by focusing on different legitimatizing
sources: the “symbolic capital” (Bourdieu 1993) of the intermediary,
the legitimacy of the convention used by the actors (Boltanski and
Thévenot 2006), or a network of aligned actors that is produced by
different operations of mediation (Latour 2005). These different
approaches of legitimacy can be considered as alternatives (Lamont
2012), but a clear-cut distinction of this kind may be difficult to make
in empirical markets, as the case of the fashion trends analyzed by
Rinallo and Golfetto (2006) shows it. The question of explanation of
the diffusion of conventions represents a problem that goes beyond the
scope of this paper, and that would need to be developed in further
research.
The second question is the corollary of the power of intermediaries:
if their actions have some effects on the social worlds they are involved
in, one may study the nature of the transformations they foster, and
what kind of control or regulation one may organize to limit their
“negative” or “pernicious” effects. The conventionalist approach can
give some analytical tools to answer some sociopolitical questions such
as the “financial crisis” by highlighting the role of the intermediaries in
the creation, the diffusion and the transformation of conventions in
crisis’ dynamics. In fact, intermediaries’ interventions can weaken the
financial system because of the difficulty to attribute some
responsibilities to the multiple concerned actors. The proliferation of
financial intermediaries and products has made it much more difficult
to determine liability during the recent financial crisis (Montagne
2009). Cervone’s work on credit rating agencies shows for example
how difficult it is to assign liability for errors or fraud to valuation
intermediaries. She points out that, especially in the American context,
investors who filed lawsuits for damages involving erroneous
assessments made by credit rating agencies had their suits dismissed. In
a recent article (Cervone 2010), she advocates the adoption of a strict
liability regime, rather than yet more regulation of the activity of these
agencies. Krebs (2009) and Tuch (2010) also underlined the power
and the role of credit rating agencies during the current economic crisis
by showing that their judgments and evaluations are far from neutral
and that their impact as “reputational intermediaries” needs some
kind of regulation.
In contrast, Orléan (2009) shows that these rating agencies are only
the bearers of valuation conventions (the interpretation of underlying
market trends) in place at a given point in the financial markets, which
all stakeholders (both issuers and investors) agree to adopt. It is thus
the market itself that constrains the rating agencies. Orléan concludes:
“In my opinion there is no evidence that anything like a rating agency
independent of the market could exist. For that to happen, it would
have to derive its income from a source that was itself independent, yet
without seeming to be a foreign body with no legitimacy in the eyes of
the investors. Is this not trying to square the circle?” (Orléan 2009,
68). Liability, then, is spread across all the players in the financial
system, making it problematic to attempt to impute liability to any
individual.
There are many other domains in which the regulation of the
evaluators’ activities could play an important role. The research led by
Demailly and Maroy (2004) about the regulation of the educative
system in Europe shows, for example, how some new types of
intermediaries both evaluate and control educative organizations and
institutions. The rise of “post–bureaucratic” institutional settings, such
as the ex post control exerted by evaluators, or the ex ante socializing
action on the professionals (teachers and administrative staff), implies
new types of cross-regulation between states, educative institutions,
and the new “transnational” intermediaries. These intermediaries, who
generally come from teaching, become either “experts in
rationalization”, “agents of proximity”, or “political executives”.
According to our typology, they can be classified as “evaluators”, but
the diversity of their status should not be overlooked, because it can
explain why organizations aimed at regulating these intermediaries
only exist in an embryonic form.
Concerning matchmakers and consultants, as they defend the
interest of the parties they represent as well as their self-interest, this
issue of the regulation of their activities is at stake.13 That raises also
the question of the drawing up professional-ethics rules to guarantee
that experts in the concerned fields will be reasonably disinterested and
will avoid conflicts of interests. Besides, these intermediation activities
can be a source of “boundary struggles” (Lamont and Molnar 2002)
between different professions or professional territories which are
arbitrated by public authorities (Abbott 1989). Whereas Economic
theory designs regulation of professions mainly in reference to the
concepts of “asymmetrical information” (between the professional and
its client) and “externality”, our notion of “power of valuation”
proposes another way to cope with this issue that would need further
development.
Conclusion
New developments in economic theory justify the emergence of
intermediaries by their role in reducing the costs of information search,
or more generally the transaction costs. In this perspective,
intermediaries generally improve the functioning of markets. More
13Lizé, Naudier and Roueff (2011) emphasize the problem of the legal qualification
of “intermediary” which cannot be, in the case of the French Law, both “third
party” and “party” to a contractual relationship.
precisely, intermediaries often add value to products by supplying

information and guaranties or by increasing their availability (Spulber
1996). This analysis of the market microstructures offers a better
understanding of the real workings of markets by highlighting the
different roles played by intermediaries which are not limited to the
sole function of pricing. But this added value is reduced to a potential
increase in the utility of goods for consumers, the definition of
individual preferences remaining exogenous. There are few economists
who take into account the endogeneity of preferences or even the
collective construction of valuation (such as graduates in the Spence
signal theory, Spence 1973), so leaving a large part of collective
valuation processes unexplored.
The pragmatist approach presented in our paper completes the
perspectives in which intermediaries are rather a passive role of
information platform. In particular, economics of convention shows
how intermediaries contribute to define valuation frames through their
different activities and instigate conventions that can improve the
coordination of actors in markets, but also reorganize the markets in
different ways. The analysis of valuation conventions may provide a
better understanding of the strategic behavior of market intermediaries
which is intended to “destabilize” the market. This approach is
consistent with previous studies highlighting how market inter-
mediaries could be more than passive classifiers, especially through the
concept of “frame-makers” suggested by Beunza and Garud (2004).
The four types of intermediaries identified in this article allow us to
underline that the dynamics of valuation frames constitute an
important dimension of the activity of so-called “evaluators”, but also
of the activity of “distributors”, “matchmakers” and “consultants”.
Moreover, we propose a characterization of these valuation frames
according to the nature of their definition (more or less distributed),
their generality and their temporality.
Once they have been differentiated in terms of their effects,
intermediaries can be a good empirical entry to study the social
organization of markets as well as the changes occurring in them,
including changes in the social and economic value of goods,
individuals, and organizations. Besides, these changes raise the issue of
the valuation power of market intermediaries and the eventual
regulation of their activities.
Acknowledgments. We are grateful for the very insightful comments

and suggestions made by the two anonymous reviewers of our paper.
In response to an earlier draft, Pierre François, Kevin Mellet, Olivier
Roueff and Rainer Diaz-Bone provided useful suggestions that we are
happy to acknowledge here. In addition, we thank Constance Georgy
for her helpful review of the last version of the article. The contents
are the authors’ exclusive responsibility.
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Christian Bessy is currently attached to IDHE (Institutions and

Dynamics of Historical Economics) as a CNRS researcher (Centre
National de la Recherche Scientifique). He is also a lecturer at the
“Ecole Normale Supérieure de Cachan”. He is specialized in
institutional economics, law and economics, recruitment and labor
market intermediaries, knowledge transfer and intellectual property
rights. He has published many books and articles on these subjects.
Pierre-Marie Chauvin is an associate professor of sociology at Paris-

Sorbonne University with a joint affiliation to the GEMASS (Groupe
d’Etude des Méthodes de l’Analyse Sociologique de la Sorbonne). His
research interests include economic sociology, sociology of reputations
and status hierarchies, sociology of time and visual sociology. He is the
author of several publications on the valuation processes within the
wine industry.

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Valuation Studies 1(1) 2013: 83–117

The Power of Market Intermediaries:

Christian Bessy and Pierre-Marie Chauvin

Key words: intermediaries; market; valuation; evaluation; convention;

Sociology, economics and political sciences are becoming more and

Pierre-Marie Chauvin, Paris-Sorbonne University / GEMASS, 28, rue serpente,

© 2013 Christian Bessy and Pierre-Marie Chauvin

administrative mechanisms. This trend is a response to the changes

valuations on markets, and the open definition of intermediary will

In the second section, we adopt a more pragmatist perspective on

Int er mediar ies and Inf or mation: S trat egic Functions

development of marketing as a discipline distinct from economics in

to solve the problems of so-called “adverse selection” and therefore to

Responses to the Under-Investment in Information by Economic

Matching and Searching

2 Another function of an intermediary is to coordinate the actions of members of a

different inefficiencies could give rise to at least two kinds of

Guaranteeing and Monitoring Transactions

match, and negotiate.4 From this point of view, the development of

Distinguishing between Intermediaries in terms of Transaction

4 By studying prominent digital intermediaries, a current of economic literature show

to the degree of specificity and thus of risk in the matching process.

The Go-Betweens: Trusted Resources for Innovative Activities

agencies, professional organizations, law firms specializing in

share of exchange opportunities are the by-products of other economic

The Strategic Behavior of Intermediaries

atypical profiles; the clients, convinced by this grouping of the scarcity

Towards a Pragmatist Approac h of t he Valuation

a matchmaker. Hence, this section moves from a view of

7 In particular, Eymard-Duvernay (1989) refers to the “orders of worth” distinguish-

inscriptions, technical artifacts, human beings and money in all its

9 He then introduces a “purely practical” (Callon 1991, 141) distinction between

The Four Types of Intermediaries and Their (Creative) Use of

example), they participate in constructing these frames through their

participating in the segmentation of the professional world in which

legitimacy of the convention (Boltanski and Thévenot 2006) or

definitions of positions that stand for a whole range of companies, at

devices. There is a growing amount of works focusing on such actors

subject to new interpretations and unforeseen categorizations made by

Intermediaries’ Power of Valuation: Definition, Generality and

The Definition of the Valuation Frame: Distributed versus

characteristics of each market, and is often linked to the temporality of

The Generality of the Valuation Frame: Standard versus Singular

The Temporality of the Valuation Frame: Short-Term versus

plurality of temporalities involved in economic worlds. Further work

Distributor Matchmaker Consultant Evaluator

Definition: Retail industries, Recruitment

Singular Headhunters in Consultant in Architecture

Explaining and Regulating the Valuation Power of

precisely, intermediaries often add value to products by supplying

Acknowledgments. We are grateful for the very insightful comments

Bessy, Christian, and François Eymard-Duvernay, eds. 1997. Les

———. 2010b. “La signature œnologique. Frontières et transferts de

Hagiu, Andrei. 2007. “Merchant or Two-Sided Platform?” Review of

Montagne, Sabine. 2009. “Le court-termisme institutionnalisé: les effets de la

Silicon Valley: The Anatomy of an Entrepreneurial Region, edited by

Christian Bessy is currently attached to IDHE (Institutions and

Pierre-Marie Chauvin is an associate professor of sociology at Paris-

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