American Academy of Political and Social Science

Culture and Markets: How Economic Sociology Conceptualizes Culture

Author(s): Peter Levin
Source: Annals of the American Academy of Political and Social Science, Vol. 619, Cultural
Sociology and Its Diversity (Sep., 2008), pp. 114-129
Published by: Sage Publications, Inc. in association with the American Academy of Political and Social
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 Currentwaysof addressingculturein the sociologyof
markets are incomplete.One approachtreatscultureas
constitutiveofmarkets(marketsare culture),whilethe
other treatscultureas somethingaffectingmarkets
(marketshave culture).This divisioncorrespondsto
markets thatare moreor less"settled."The authorout-
lines the historyand shortcomingsof thisdualityand
proposesa moredimensionalapproachto cultureand
marketsthat more fullyintegratescultureinto eco-
nomicsociology.
Cultureand Keywords: sociologyof markets;performativity; cul-

Markets:How turalsociology;socialstudiesoffinance

Economic economic hasstrug-

sociology
Sociology on understanding
gled with
Contemporary culture. Despite the emphasis
economyand culturein
Conceptualizessociology's
approaches,
classical theories,contemporary
particularly thosefocusedon mar-
Culture ketsandmarket
of markets
are
activity, different. Thisnew
cultureinto
sociology incorporates
analysesofeconomicactionbytreatingculture
as something thatconstitutes
marketsor else
affects - but notboth.This is
theiroperation
somethingof a departurefromsociology's
historicalroots.WhereasMax Webers work
PETER LEVIN
focusedon theelectiveaffinities
betweencul-
ture,religion,and the developmentof eco-
nomicsystems, and Marxsworkdemonstrated
thefundamental connections
betweenrelations
of productionand the dominantconceptual
toolsand ideasoftheday,the"neweconomic

Peter Levin is an assistantprofessorof sociologyat

BarnardCollege.His researchis on the culturaland
organizationalbasesfor markets.His earlierresearch
examinedhow theshiftin technology fromface-to-face
toelectronic
tradinginfinancialfuturesmarkets affects
thewaysmarketsare shaped.He is currently studying
howartspecialistsvaluefineart.
NOTE: I would like to thankMaryBlair-Loyforher
sharpeditingand substantivecontributions
to theclar-
ityof theseideas, MichaelSchudsonforhis insightful
commentson thearticle,andAmyBinderforherongo-
and suggestionthatcultureand econ-
ing collegiality
omyoughtto be moretiedtogetherthanseparate.
DOI: 10.1177/0002716208319904

114 ANNALS,AAPSS,619, September2008

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CULTURE AND MARKETS 1 15

sociology" approachesculturein a lessfruitful and lessintegrative fashion. This

deservesreconsideration.
The reemergence of economicsociologyin the early1980sentaileda new
aggressive stance toward whathad been,at leastsincemidcentury, an abandon-
mentof core economicprocessesto economists.New researchemphasized
applyingsociologicaltoolsto economicphenomena,particularly production
markets, financialmarkets, and nationaleconomies.HarrisonWhites(1981)
influential article,"WhereDo MarketsCome From?"was theharbinger ofthis
movement. His worklookednotto thecultural and
practices religious tenets of
a societyin theoriginsofan economicsystem, or to theeffects ofrelations of
production on societyas a whole(as theclassicalscholarshad),butrather to the
criticalroleof socialnetworks and tiesbetweenfirmsin production markets.
Researchinthisneweconomicsociology shifted fromexplaining thecultural and
historical origins of economic to
systems explaining the inner of
workings capi-
talistproduction. The answerforWhitewas thatmarkets comefromcliquesof
producers watching each other.Whiteemphasizedstructural network relations
betweenfirms as an alternative to conventional neoclassicaleconomicaccounts
ofmarket formation, whichassumeatomistic, arms-length transactions.
Thisshiftin emphasishas resultedin a reducedspace foreconomicsociolo-
giststo studyculture, evenas researchinthisspecific veinofnetworks andmar-
ketshas becomemuchmorecentralto economicsociologyas a whole.The
centraltothesociology ofwork - exploitation, workplace
long-standing questions
culture, inequality, and
race, gender - have givenway economicsociology
in toa
stronger research interest in financial markets, firms, and the organization of
capitalist and
production consumption. Within this area remains a diversityof
research. Somesociologists examinehowmarkets areculturally constituted, chal-
lenging theimageofmarkets as self-governing mechanisms andinsteadshowing
theirdeep culturally andhistorically contingent roots(Callon1998;MacKenzie,
2006). Others complement and extend more conventional economicexplanations
formarketbehaviorby including the effects of networks, intermediaries, and
country-level legalsystems on market outcomes such as price and firm perfor-
mance(Uzzi and Lancaster2004;Zuckerman 1999).Thisarticleis notan argu-
mentfora reintegration ofthesociology ofworkwiththesociology ofmarkets.
Rather, it is an attempt to make sense of this new interest in markets and to
we
exploreways might integrate culture more thoroughly within this field.
In theseforays intodomainspreviously reservedforeconomists, theconcept
ofculture is used in distinct ways. A firstset of scholars, which I denote by a
"markets are culture" or constitutive approach,conceptualize markets them-
selves as cultural.In thiswork,marketsthemselvesare the objectsto be
explained, and analysesattempt to understand theconventions and institutional
- - that make markets look thewaytheydo.
agreementslegal,cultural, cognitive
In thisargument, commodities do not present themselves as alreadyexisting and
readyto trade.Instead,labor,land,art,bodies, as well as housing, consumer
goods,andservicesall haveto be transformed intoeconomicobjectsbycultural
practices and legalinstitutions. Likewise,therational market actorsassumedby

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116 THE ANNALS OF THE AMERICAN ACADEMY

muchofeconomictheory alsohavetobe transformed, viawhatCallon(1998)has

called"calculative For
agencies." instance, laws or customs againstnepotism in
hiring would requireemployers to think of themselves as economic agentsby
making itillegalto actas members ofa clanor family (or at leasttojustify their
actionsinthislanguage).Artlovershavetobe taught theappropriate ways act
to
as artinvestors - someeconomicrationality, butnotso muchas to makethem
appear vulgarto artistsand dealers (Velthuis2005). Rationality, calculative
agency, and commodities are outcomes of cultural processes. These are allways
thatcultureis usedto explainhowmarkets takeshape.
A secondapproach,denotedbya "markets haveculture"or complementary
approach, conceptualizes culture as an independent variableinan otherwise fun-
damentally economic market. Here, culture influences and determines the con-
ventionally understood outcomesofeconomicmarkets. Thisapproachassumes
thattheobjects,actors,and activities thatcharacterize markets are alreadysta-
ble, and the aim of the analysis is to augment the variables that wouldhavean
effect on market outcomes.Culturaleffects areportrayed as beingoutsideofor
exogenous frommarkets. Markets areessentially economicinstitutions, governed
by laws of and
supply demand,populated with rationalactors,trading fungible
commodities. Cultureaffectshow theyworkbut nottheirconstruction. This
is
approach complementary in that itis meant to extend rather than replacecon-
ventional neoclassical analyses of markets. It takes and
prices performance as its
outcomevariables, adding to the independent variablesa new set of sociologically
inflected determinants.
The tensionbetweenmarkets as cultureand markets as havingculturehas
been a productive one forthe field.It facilitates macro-level comparisons of
industrial development (Fourcade-Gourinchas and Babb 2002) as well as more
micro-level constructions ofriskand decisionmakingbyfinancial actors.It can
be mobilizedacrossa wide rangeof capitaland production markets. And it
reasserts the centralsociological insightthat economic action is contingent on
culture, institutions, and social structure; that culture matters, despite essential-
istclaimsgoingbacktoAdamSmiththateconomicmarkets arisenaturally from
individuals' intrinsic impulses to "truck and barter."
Examining thesewayseconomicsociologists use culturealsorevealsa kindof
split,breaking across the types of markets beingstudied.For somemarkets, itis
the marketitselfthatis cultural - marketswherethe commodity is highly
chargedor contested, including bloodand bodyparts,environmental pollution,
as wellas moreproperly understood "cultural goods"suchas artandfashion. In
thesekindsofmarkets, thecentralquestionaskedis howto managethecultural
valenceofthecommodity beingboughtand sold.The problemto be solvedin
these marketsis one of stabilizing categories,information, and conventions
aroundthemarkets themselves. Otherkindsofmarkets are treateddifferently.
Studiesof financialmarkets,and more highlyinstitutionalized marketsfor
and
labor,services, goods, take for granted that thesecommodities can be and
are boughtand sold by actorswho havetheinterest and inclination to do so.
Cultureheremanifests as a partoftheexchange process.That is,financial markets
havea culture, whileartmarkets areculture.

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CULTURE AND MARKETS 117

But thisdichotomy is also limiting.By eitherassumingthatmarketsare

already and
constituted, neglecting waysthisconstitution
the actsin interaction
withmarket outcomes(markets-are-culture), orassuming markets arestableand
thatculturematters byaffecting performance outcomes (markets-have-culture),
thesetwoperspectives advanceresearchon howmarkets workat theexpenseof
insights missed.Work that looks at markets as needing be fixedor settledin
to
timeandplacebeforetheylooklike"normal" markets highlightstheconstitutive
workofculturebutmissesthefactthatculturealsodetermines markets'ongoing
operations,whichthen potentially affectshow the marketis constituted.
Likewise,workthatlooksat marketoperationmissesopportunities fora more
distinctive case
sociological forstudying markets.An alternativeapproachrecog-
nizesthatthe dichotomy between"cultural" marketsand "economic"ones is
false;as such,we needtobothproblematize seemingly settledcommodities and
understand the culturalcontexts of contestedones. In short,we need to shift
froma flatdichotomy to a moredimensional viewofhowcultureand markets
interact.The aimofthisarticle,then,is to investigate thismovetowarda more
multidimensional viewofcultureand economicsociology. Analysis variesalong
twoaxessimultaneously, constitutive and complementary. Conceptualizing cul-
tureas bothcomplementary andconstitutive mayprovide additionalleveragefor
economicsociology. I highlight twonewperspectives ineconomicsociology that
use thisthinking.

Analysisvariesalongtwoaxessimultaneously,
constitutiveand complementary.
Conceptualizing cultureas both
complementary and constitutive
mayprovide
additionalleverageforeconomicsociology.

First,I tracetheascendanceofembeddedness
The articleproceedsas follows.
as it emerged as an alternative
perspective to economicdominancein studying
markets andas a new point engagement thefield.I thenshowhowculture
of in
emerged in the critiqueofembeddedness, bothin theconstitutiveperspective
and the complementary perspective.Movingfroma dichotomous to a dimen-
sionalviewoftheconstitutive andexogenous ofcultureon markets,
effects I then
turnto twodistinct approachesthat are attempting something newin the field.
One of these,drawingon Viviana Zelizers (2005) notionof "connected lives"

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118 THE ANNALS OF THE AMERICAN ACADEMY

addressesbothkindsofcultural
effects A secondapproach,
simultaneously. con-
tainedin the new emphasisby scienceand technology studieson finance,
addressestheconstitutive
andexogenous effects thetwo
ofculturebycollapsing
intothesameanalysis.

ExistingWaysof Doing EconomicSociology

Thisnewkindofeconomicsociology, divorcedfromWeber'searlierconcerns
withtheentanglements ofreligion, culture, andcapitalism as wellas Marx'scon-
cernswithcapitalismand societalchange,has turnedinsteadto addressthe
broaderfieldofeconomics.Sociologists haveadoptedsimilarresearchconcerns
as economicsand finance:financialmarkets,productionmarkets,national
economies.Yet,no longercontentto see the worldsplitinto"markets" and
"everything else," economic sociologists have also begun to use sociologicaltools
to investigatethesearenas.
The centraladvanceforeconomicsociologists emergeddirectly out of the
structuralnetwork approach. In the single most-cited articlepublishedin a soci-
ologyjournal(more than twenty- five hundred citations),Mark Granovetter
(1985) used the concept of embeddedness to arguethateconomicactionis
nestedwithin ongoing social relations. Despite dominant
the imageofmarkets as
a setofarms-length transactions, Granovetter noted that most actualmarkets are
composedofrepeatedtransactions within continuing relationships. Thisconcept
ofembeddedness provided an ambitious research agenda, and it has sincebeen
bothelaboratedand extended, provoking a flood of research by a "massive" set
ofscholars (Fligstein and Dauter 2007,112) as well as a number of critical
forums
andreviews(Krippner et al. 2004;Krippner andAlvarez2007).
Interestingly,the subfield quickly coalesced arounda specific kindofembed-
dedness:structural embeddedness. The mainbenefitof structural embedded-
nessis thatit shifts ourthinking fromindividuals and firms to thetiesthatbind
themtogether. Thesenetworks haveprovedusefulforunderstanding whysome
people, for instance those who bridgelarge networks (so-called "structural
holes"),arebetterable to influence othersin organizations (Burt1992).Evenin
financialmarkets, where we might expect individuals to be totally individualistic,
differentconfigurations ofstructural tieschangethewaystraders areabletobuy
andsellfinancial options(Baker1984).Suddenly, something distinctlysociologi-
cal wasfoundto havemeasurable effects on coreeconomicprocesses, including
pricesandvolatility.
The downsideofstructural embeddedness is thatithas littleto sayaboutthe
content ofongoingsocialrelations. Diamondtraders in theNewYorktrademay
be able to exchangethousands ofdollarsworthofdiamondswithmutualhand-
shakesandthesureknowledge thattheyareembeddedinnetworks, butthisstill
doesnotmakesenseuntilwe notethecommonethnicity ofthesetraders, mainly
HasidicJews(Carruthers andBabb 1999,4). Likewise, onthetrading floorBaker

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CULTURE AND MARKETS 119

(1984) studied,thereis no mentionofthefactthatvirtually all thetradersare

men,thattheynowoftencomefromthesameneighborhoods ofChicago,orthat
generationsofin-lawsandrelatives entercommodity futurestrading.Allofthese
thingsmay alsohave an effect
onwho with
trades whom. In otherwords, thecon-
tentof tiesdisappearsin structuralembeddedness approaches. Some scholars
and
(Zukin DiMaggio 1990)have to this
attempted remedy problembymaking
thecase formultipletypesof embeddedness - cultural,
political, - in
cognitive
additionto structuralembeddedness to moredirectlyaddresstheshortcomings
of Granovetters ongoingsocial ties. Nevertheless,these alternativesremain
largelyunexamined. Concepts ofculturehave instead
entered into thisresearch
intwofairly specificdirections.

Marketsare culture:Theconstitutive
approach
The firstdirection, whichI call the "marketsare culture"or constitutive
approach, takesas itscentral claimthatmarket actors, objects,andactivitiesmust
be madestable before they can look and act like economic markets. In a com-
pellinganalysisof the mythof the individual artisticgenius,HowardBecker
(1982) claimedthat Art Worlds are the outcome ofa broadrangeofconstituen-
ciesandpatterned conventions - such as the kinds ofart,music,anddancethat
"count"as art,as wellas the more technical elements ofinstrument construction
andmuseumdoorframe sizes. The artisticgenius arises out of theseconventions
andinfrastructure, notviceversa.Likewise, markets ariseout of theculturalwork
ofmakingcommodities, marketactors, rational agency, and bilateral
exchange.
The focusoftheanalysis is on thisconstitutive activity.
The"markets-are-culture" doesnotsubsumemarkets underculture -
approach
markets of
are notsimplya reflection culture - but nevertheless treat the con-
stitutivenatureofmarkets as theirmainaim.Thisdrawson a phenomenologist
tradition in sociology,particularly in thepragmatic and symbolic interactionist
traditions. The centralinsightis thatmarkets do not come preformatted. The
worldis notpopulatedwithbuyersandsellers,commodities, rationalagency, and
market exchange. Thesehaveto be createdcognitively, and
structurally, legally.
Cultureintheseanalysessolvestwomainproblems. The firstproblemis thatfor
marketexchangeto occur,and particularly for market exchangeto occurrou-
tinelyandwidely, theobjects,actions, and actors must be maderealwithsuffi-
cientpublicknowledge. in and
Work commensuration categorization andin the
creation ofnewkindsofcommodities fallinto this category.
For example,Carruthers and Stinchcombe (1999) demonstrated howliquid-
ity,normally treatedas a function is
ofmarkets, actually the outcome ofa num-
beroflegalandcultural conventions. of
The standardizationgoods,theyargued,
"isa social,andcognitive achievement, andthatbuyers, market makers, andsell-
ersallhavetosharea deepconviction thatthe'equivalent' commodities a large
in
flowof (say) financialinstruments are reallyall the same" (pp. 353-54).
Examining British national debt and contemporary mortgage bonds,theyfound

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120 THE ANNALS OF THE AMERICAN ACADEMY

thatenoughpublicknowledge aboutthesenascentfinancial instruments has to

be generated and stabilized, so thatpricesand quantities can be theonlythings
thatvary - andtheresultis a liquidmarket.
Similarly, Zuckermans (1999) studyofcategorical incoherence ofstockspro-
videsanotherexample.Here,he lookedat thepricesforstockscoveredandnot
coveredbysecurities analysts as a measureofthelegitimacy ofthestock.Normally
associatedwithgatekeepers and criticsin culturalindustries, stockanalysts are
marketintermediaries in thefinanceindustry who"cover"stocks,reporting on
theirprofitability and prospects forfuture performance. Zuckerman found that,
all things beingequal,thenumberofanalysts covering a firmincreaseditsstock
market price. What he concluded from in
this, part, is that "fora producttocom-
in
pete any market, it must be viewed by the relevant buying publicas a playerin
theproduct categories in which it seeks to compete"(pp.1428-29).Itisnotimme-
diately obvious even in the case offinancialsecurities (muchlessincontemporary
artmarkets orothermoreuniquecommodity markets) whata company doesand
howitmeasuresintheindustries inwhichitcompetes.
In a moreesotericand less institutionalized market,Levin and Espeland
(2002) also demonstrated the of
problem publicknowledge intheconstitution of
commodities. They examined the creation of tradable air pollution permits under
TitleIV of the 1990 Clean AirActamendments. One problemfacedby state
actorsandregulators washowtochangecultural beliefsandpractices from think-
ing of the environment as a free natural resource to thinking of it as a limited,
costly, economicresource.Levinand Espelandshowedhowthisculturalshift
entailedlegal,technical, and cognitive workto transform diffuse pollution into
concrete, tangible, fungible trading units. Bymeasuring in
pollution aggregated
units(tons)rather thanas rates(partspermillion), theEnvironmental Protection
Agency was able to enforce the idea that a ton ofpollution in one place was equiv-
alentto a tonof pollutionin anotherplace,despiteregionaland atmospheric
specificity ofgeography. Eventhismeasure, however, requireda prodigious tech-
nological infrastructure. Standardized measurement tools had to be developed,
withpublicly available(andelaborate)specifications to measuretherawtonnage
of sulfurdioxidecomingout of a particular smokestack.Onlyonce thiswas
established did thislegalizedinfrastructure beginto operateas a market, with
and
buyers sellers,commodities, exchange. and
The secondproblemfacedinconstituting market objects,actors, andactivities
is an institutionalization ofconventions - legal,cultural, -
cognitivein orderfor
themarket tooperate.Conventions differ from
slightly publicknowledge. Public
knowledge about property rights and land for
ownership, instance, does not
matter ifthereis widespread disagreement about what ownership means, who is
for
eligible it, and how itcan be transferred. Likewise, as Callon has
(1998) noted,
calculativeagency - the assumption thatindividualsassess exchangeoptions
againsta set of personalpreferencesand make decisionsbased on these
preferences - is botha bedrockofrational economicexchangeanda deeplycul-
turalconvention.

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CULTURE AND MARKETS 121

The literature fromanthropology on commodification demonstrates thiskind

ofworkwithintheconstitutive approach.Kopytoff (1986) noted that commodi-
tiesmustbe alienable - able to be separatedfromtheirowneror theirwider
context - forthemto be able to be broughtintotensionwithotheralienable
goods.Heirloomsand prescription medications are examplesin thisrespect.
These objectsmaybeginas commodities butthentakeon an individuality and
inalienabilitysuch that theyonly have as
meaning objects to theirend-parties.
Fortheseobjectstobe commodified, theyhavetoundergo somesortofritualistic
exchange (inthecase ofheirlooms), orelsebe trafficked inas illegitimate objects
(in the case of prescription drugs). To be sure, these objectscan indeedbe
exchanged, butnotwithout undergoing somesortoftransformation ofmeaning,
andnotwithout operating within particular legalconstraints. Other kinds ofobjects
used to be able to be tradedas commodity, in the case of humanslaveryor
medievalreligious relics(Geary1986)butare no longerconsidered legitimately
commodifiable entities.
WendyEspelands(1998)studyofthecontestation overthebuilding ofa dam
in theSouthwestern UnitedStatesprovidesa case in point.As partofitsefforts
to purchasethe land necessary to buildthe dam,the Bureauof Reclamation
to
attempted negotiateprice a with theYavapai,thelocaltribeforwhomtheland
was an ancestral home.The tribes unwillingness to negotiate stemmedfromits
refusal toconsiderlandas a commodity; selling itwould be tantamount toselling
ones mother. Without agreement on what counts as a commodity, orelse an abil-
ityfor one to
party impose that definition of the situation on the other, there sim-
ply could be no market If
exchange. people of color simply do not count as
potential corporate actors within a given market context, for example, it makes no
senseto thinkofblack,Latino,orAsian"market actors."
These commodities are contested commodities, in thattheyare impartially
institutionalized intomarketexchange(Radin2001). The mostdemonstrable
reasonsforthisare thattheobjectsto be exchanged are imbuedwithculturally
fateful -
qualities life,faith, blood,sex,personhood. Wallingoffthesecommodi-
tiesis an indicator ofa "separatesphere"mentality, whichsees contamination in
themarket of
exchange particular, deeplymeaningful artifacts and objects. But
contestedcommodities encompassa rangeofpotentialcommodities forwhich
theproblemis notthattheyaremeaningful butthattheyareambiguous.
A moreusefulwaytoconsiderthepublicknowledge andcultural conventions
aroundcontested commodities and ambiguous exchange is to consider howset-
tledthatmarketis. The characteristic workin thisgenreis workon contested
commodities and culturalproducts, but thisis becausethesecommodities are
mostunsettled inmarket contexts. Thisis nota matter oftime,ornovelty, though
itmaysometimes be thecase.Instead,analysesofmarkets as culturehaveexam-
inedmarkets wheredefinitions ofthecommodities are newand remainpoten-
flexible,
tially where there is categorical incoherence or a lackofpublicknowledge
aboutthecommodity, orwherethereis contestation overthecultural meaning of
theobjects,actors, or activitiesinvolved in exchange.

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122 THE ANNALS OF THE AMERICAN ACADEMY

Marketshaveculture
A largerbodyofworkclaimsnotthatmarkets areculturebutrather thatmar-
ketshaveculture.The insight ofthisworkis thatmarkets, once settled,stilldo
notactthewaytheyareimagined toinneoclassical economics textbooks. In par-
theeconomicimageofmarkets
ticular, is tooatomistic andtoorootedinindivid-
ual agency(Granovetter 1985). Economicsociologists workingin thisgenre
continue toposethemselves against neoclassical economic theories,evenas they
havebegunto dovetailwithbehavioral economicsand gametheory, attempting
to takeintoaccountrepeatedinteractions and widerenvironments of market
transactions. Whattheseapproachesshareis (1) agreement thattheelementsof
market exchangeare settledanddo notthemselves requireanalysis and (2) that
theoutcomevariablesofinterest areconventional market outcomes, whether in
theformofwelfareefficiency, prices, firm survival, or performance.
Thisapproachis complementary vis-a-vis economicmodels.The aimis notto
understand howmarket exchange can exist but to "document themyriad waysin
whichsocialrelations leavetheirimprint onbusinessrelations, shapingeconomic
outcomesin waysthatruncounterto the expectations of economictheory"
(Krippner and Alvarez 2007, 232). Culture, social ties, and politicsare assumed
toaffect economicmarkets inwaysthatcomplement orextendneoclassical mod-
els.Despitetheclaimthatembeddedness a
representsdisjuncture rather than an
extension ofconventional ways to think about markets, this approachimagines
markets as stablebutinfluenced bycultural variability.
One ofthemoresophisticated versions ofthisapproachis inthecomparative
workofBiggart and Hamilton(1988).In an analysis ofSouthKorean,Japanese,
and Taiwaneseindustrial organization, they found that culturalexplanations -
"primordial constants"linkedtobroaderpatterns -
ofthewidersociety do a poor
of
job explaining distinctive differences amongthe threecountries'industrial
regimes. But in so,
doing they demonstrated howcultureis mobilized in an eco-
nomicsociological analysis. Culture is one explanatory variable amongmany, the
othersbeingmarket variablesandauthority patterns. Each of the countries has a
sometimes distinctive
andsometimes commonculture, whichinturnaffects their
industrial outcomes.Even in discarding cultureas thekeyexplanatory variable,
theauthorstookforgrantedtheactors,objects,and activities involved in indus-
trialmarkets. As theynoted,"Lookingat culturealone obscuresthe factthat
businessorganizations, no matter howwelltheyaccordwithcultural beliefs,are
fundamentally responses to market opportunities and conditions.Enterprise may
be culturally informed, butitremainsenterprise" (p. S53).
Some kindsof marketsare thusunderstoodto be embeddedin cultural
arrangements, but thisdoes notmeanthatmarkets are constituted by culture
but,rather, thattheyareinflected by culture - that they have a culture.Thisfacil-
itatescomparative studies,wherewe can see thewaysa politicalcultureshapes
industrial development (Dobbin1997)andtheadoptionofneoliberal economic
reforms (Fourcade-Gourinchas andBabb2002).Thatis,inadditiontostructural

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CULTUREAND MARKETS 123

embeddedness
(network ties),culturealsogoverns
economicexchange.
We may
sometimes
thinkofthisas a particular
kindofpoliticalculture.

Somekindsofmarketsare thusunderstoodto
be embeddedin culturalarrangements,butthis
does notmeanthatmarketsare constituted by
thattheyare inflected
culturebut,rather, by
- thattheyhavea culture.
culture

Thisapproachalso mapsmoreconventionally ontorace and gender,where

labor
already-constituted markets and household oflaborare analyzed
divisions
by these Portes
categories. and Sensenbrenners (1993)analysisofethnicenclaves
among Latino immigrantsuses in
culture thesame fashion, a determinant
as for
economicoutcomesratherthanas a constitutive forcein itself.Andtherather
largeliteratureongenderandhousehold labor(DeVault1994),atthelevelofthe
householdbutalso at thelevelofwelfarestatepolitics(Orloff1996),treatsthe
categoriesoflaborandwelfare inmoredetailtheeffects
as alreadygiven,treating
ofraceorgenderdifferences on thoseeconomicoutcomes.

Movement acrosstheconstitutive/complementary divide

The dichotomy betweentheconstitutive and complementary approacheshas
resultedin a theoreticallimitation forthefield.The centralproblemis notnec-
thelackofconversation
essarily betweenthesetwogroups, as theyoftendo build
on one another. It is theeither/or conception ofculture.Cultureactsas some-
thingthataffects howmarkets are built,or else it affectshowmarkets operate.
Constitutive activitiesare necessaryto stabilizemarketactors,objects,and
actions,enoughso that"normal"marketforces - now withculturalvariables
-
addedas keydeterminantscan operate.Andonce theseactivities occur,mar-
ketsare seen as acquiringa kindofpermanent stabilitythatallowsus to then
gaugetheiroperation. As a result,we endup withanalysesofhowcreativity and
highlycontextualized knowledge offashion is transformed into a commodity for
consumersale (Aspers2006) and studiesofhowsocialtiesaffect performance
amonggarment industry firms (Uzzi 1997).Butwe getverylittleon theinterac-
tionsacrosstheseprocesses.
Currently,cultureis treatedin economicsociology in a fashionsimilarto the
way Ann Swidler (1986) described cultures role in shaping action.She suggested

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124 THE ANNALS OF THE AMERICAN ACADEMY

thatcultureshiftsitsmeaningas we movefromsettledtimesto timesofflux.In

herargument, cultureis usedduringtimesofuncertainty as a signpostforfind-
ingand orienting ultimatevalues.
During more settled
periods, however,culture
becomesmorea setoftoolsthatpeoplecanuse.Thereis an analogousargument
withregardto markets. In unsettled markets,cultureactsas a meansto create
stability
among actors, and
objects, activities.
Through publicknowledge andthe
institutionalization
of conventions, the worldis formatted intorationalactors,
commodities, andmarket exchange. In marketsthataresettled,bycontrast,cul-
turebecomesan independent variable,a determinant among othersfor under-
standing theeconomicoutcomesofmarkets - prices,firmsurvival,performance.
Lesssettledmarkets arethemselvesculture.Moresettledmarkets havea culture.

ThinkingMultidimensionally
Whyis thisa problem?It assumestoomuchstability intheunderlying market
categories,and it does not take into account the waymarket outcomes might be
affected notonlybytheircultural context butalsobytheircultural constitution.
Settledmarkets arenotpermanently setmarkets. Children weregradually taken
outofmarket as
exchange they went from economically valuable but not socially
valuedto sociallypricelessand economically valueless(Zelizer1994). Human
beingsmovedoutofa commodified state,evenas mostelements ofhumanactiv-
ity,including emotion, and
sexuality, labor, have become increasinglycommer-
cialized.Medievalrelicsbecamepriceless;air pollutionbecame salable.The
problemwithtreating thecultural constitution ofmarkets as antecedent activity
is thatit prevents us fromunderstanding howand whymarkets in somecom-
moditiesaffecttheirconstitution. The culturalconstitution work is both
antecedent andcontinuous, evenifitappearstobe settled.Anditinteracts with
culturein markets' ongoingoperation.
The useofcultureineconomicsociology is dichotomous, butitshouldbe mul-
tidimensional. This is not a new idea, but it is one thathas notyetreached
fruition.Zukinand DiMaggios(1990,17) proposalwas to add culturalembed-
dednesstomorestructural landsofembeddedness. Theynoteda "dualeffect" of
cultureon economicinstitutions: "On theone hand,itconstitutes thestructures
inwhicheconomicself-interest is playedout;on theother, itconstrainsthefree
play ofmarket forces" (p. 17). Cultures dual effectofboth economic
constituting
structures and affecting marketforceshighlights theproblemlimitation ofthe
dichotomy between the constitutive and complementary approaches. Theorizing
thisdualnaturemorecarefully providesa bettervantagepointforseeingculture
and markets simultaneously. Analyses can runalongtwoaxes,betweenconstitu-
tiveand complementary. Table 1 illustrates thisperspective. The topleft(mar-
kets have culture,marketsare not cultural)represents the complementary
perspective. The bottomright(markets areculture, markets do nothaveculture)
represents the constitutive approach. Neoclassical economics occupiesthelower
left,representing markets as beingunproblematic in their constitutionand

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CULTURE AND MARKETS 125

TABLE 1
ORTHOGONAL VIEW OF CULTURAL ECONOMIC SOCIOLOGY

MarketsAreCulture

Low High
Marketshave
culture
High Complementary viewofculture New directionin economicsociology
Low Neoclassicaleconomics Constitutive
viewofculture

relatively byculture.1
unaffected It is thetoprightofthetable(marketsarecul-
ture,markets haveculture)thatrequireselaboration.
thatthefieldis moving
Thereare indications towardthissimultaneous
treat-
mentofculture.Tworecentthreadsserveto highlight thisnewdirection.
The
firstthreadcomesoutofworkinfluenced byVivianaZelizers "connectedlives"
approachtounderstanding therelationship betweeneconomicandcultural activ-
ities(Zelizer2005).Workon theprimary artmarket(Velthuis
(first-sale) 2005)
andon bloodandorgandonations (Healy2006)takeup themultiple taskofcon-
stitutingmarket and
objects cultures effectson thesesame markets.

Connectedlives
VivianaZelizer,whoseresearchspansa numberoflinkedmonographs on life
insurance,childlabor,money, andintimate relations,is bothcentralto andidio-
syncraticto culturaleconomicsociology. On one hand,herworkdemonstrates a
deepskepticism toward a strong breakbetween culture and markets.Zelizerargues
persuasivelythatthetendency tosee thetwospheresas eitherhostileorsubsumed
onewithin theothermasksthewaysthateconomic actionhingesonthecontinued,
variegated cultural
meaning we attributeto economic exchange.Zelizerworksat
theboundaries ofcultureandeconomy. In hermostrecentandexplicit formula-
tion (Zelizer 2005), she arguedthatpeople differentiate meaningful social
relationships a
using variety ofmedia, including money. Economic exchangeis a
potentialboundary marking enterprise,though itis not so.
necessarily
Zelizers projectis a slightlydifferentone fromtheone engagedin bythose
whofollowed her.Zelizercanbe understood as theinverseofembeddedness. If
Granovetter s mainprojectis to understand the effects of ongoingsocialrela-
tionson economicoutcomes,Zelizers projectis to see theeffects ofeconomic
markets on ongoingsocialrelations. She notesthat"allongoingsocialrelations
(intimateor not) includeat lease a minimum of sharedmeanings, operating
rules,and boundaries separating one relation from another"(Zelizer2005,33).
Includingeconomictransactions in social relations"generally magnifies the
effort thatpeople investin defining and disciplining theirrelations"(Zelizer
2005,34). Her project,then,is tounderstand themyriad waysthatpeoplemark

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126 THE ANNALS OF THE AMERICAN ACADEMY

money,children,life,and intimatetransactions usingeconomicand noneco-

nomicmeans.
IfZelizerherself usesculturedifferently becauseheroutcomesofinterest dif-
fer,two works following her lead use culture in the both/and fashion I advocate
here.The first, OlavVelthuis s (2005)bookTalking Prices,analyzedthestrategies
galleryowners use to pricecontemporary art. The natureofthismarket is such
thatsellingcontemporary artis lessabouttheartthanthemeaning itembodies.
Galleryownersframepurchasesas supporting theartworld,buttheyalsonego-
tiatehowmuchto sellartforso thatthepriceconveysnotjusteconomicprofit
butalsocultural meaning. The market is culture;dealersmarkartas a noncom-
modity even as they sell the same art. Galleryownersuse a front-room/
back-room strategy,whereby in the front ofthegallery theartis talkedaboutas
a specificallycultural object but in the back of the gallery itspriceis negotiated
andtheartis boughtandsold.Butthemarket alsohas a culture;dealersdo not
adjustpricesto maximizeprofits(as an economically rationalactormightbe
to
expected do). Instead,they follow the conventions of theirprofessional com-
and art
munity, theyprice according todistinct kinds ofnarratives. A dealer might
raisepricesquickly foran artist, andjustify itbyreferring totheartist as a super-
star;alternatively,dealersmight raisepricesgradually, offering prudenceas a jus-
tificationforit. These narratives help to sell art, but they also locategallery
ownerswithin an artcommunity whosenormsaresuchthatprofit maximizers are
treatedwithskepticism and animosity. Cultureremainsdistinct initstwomean-
ingsthroughout thework,butitis clearthattheyoperatesimultaneously.
Likewise, Healys (2006)workonbloodandorganmarkets setouttoshowhow
altruism, rather than beingantagonistic to market exchange, an outcomeofthe
is
organization of these markets. In the case of organs, thecommodities havetobe
carefully accounted for by transplantation organizations. Because the United
Stateshas formally outlawedsales in humanorgans,theseorganizations have
adaptedexpressive means of making markets in the face of formal prohibition.
Healynotedthat"disguised payments, benefits, and giftsto donorfamilies" do
notjustmaskmarket but
exchange actually facilitate families' decisions to donate
organs.In otherwords,organsareconstituted intomarket commodities viaquite
sophisticated cultural accounts of what a donation means, how it mightaffect
families,and how it might be a moral act on behalf of the community.
Atthesametime,itis alsoclearthatthemarket forbloodandorgansis struc-
turedby the organization of organcollectionregimes.Comparingcollection
regimes across a number of countries, Healy(2006) founddifferences in altru-
ismas an effect oftheorganization oftheblooddonationregimeinthecountry.
State-run organizations tendto havemanydonorsbutfewrepeatdonors;Red
Cross-runregimeshad morestudents donatebloodthanstate-run systems. In
otherwords,thismarkethas a culture(and an organization, and an infrastruc-
ture),and culturalvariation affects theefficiency withwhichcollectionworks.
Whatis interesting aboutHealys analysisis thattheculturalcontext ofthecol-
lectionregimechangesthemeaningofthecommodity itself.Collectionregimes
createopportunities to giveor notto give,and in the process,theyactually

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CULTURE AND MARKETS 127

producedifferentdonorpopulations.Thisis a linkagebetweenmarkets'
having
cultureand beingcultural;thecultureofthemarketactuallychangeshowthe
marketis culturally
constituted.

Socialstudiesoffinance
A secondapproach,in thescienceand technology studiestradition, has also
addressedbothconstitutive andcomplementary approaches. It does this bycol-
lapsing the distinctionsbetween them. Michel Callon has been the most theo-
retically vocal researcher in this tradition, noting that markets need to be
formatted - thatcalculative agencies are a sociotechnical accomplishment, a not
stateofnature(Callon1998).Morerecently, DonaldMacKenzieandcolleagues
(e.g.,MacKenzieand Millo2003) haveproducedstudiesoftheorigins offinan-
cial optionsmarkets, the
demonstrating ways thatsecurities options and stock
indexderivatives havecomeintoexistence.
In thiswork,economists loomlarge,as theculturalagentswhotheorizethe
markets they thensubsequently cometocreate.Stockindices,forinstance, area
directresultof theorizing fromfinancial economics.For example,the capital
assetspricingmodel(CAPM) providedthe theoretical justification forinvest-
to
mentfirms begintaking largepositions on a broad range of stocks to mimicthe
"overallmarket" and for the subsequentactivity in the market itself takenby
firms. In hismost vividexample, MacKenzie (2006) showed how the now-famous
Black-Scholes modelforpricingoptionsjustifiedthe creationof the Chicago
BoardofOptionsExchange.Butthismodelalsobecameincorporated intoactual
of
prices options on the Exchange floor.
Here again,culture, in the form ofeco-
nomictheorizing about the financial world, both made the commodity madeand
thecommodity in a
operate particular fashion.
In thesamevein,analyses oftheso-called"performativity" ofeconomics inthe
making offinanceemphasize the sociotechnical creation of rational agencyand
commodities. Beunzaand Stark (2004),studying organization electronic
the of an
trading floor, how
demonstrated arbitrage becomesnotjusta trading strategy but
almosta newcommodity itselfviathe culture and technical configurationtheof
trading room.Thereis no distinction between culture as constitutive andculture
as affectingtheoperation ofthemarket; are
they collapsed intothe same sociotech-
nicalanalysis.

Conclusion
In thisarticle,I demonstrated howculturehas been used in twodistinctive
element
as a constitutive
fashions, ofmarkets variablethat
andas an externalized
affectsmarkets.Only recentlyhave sociologistsbegun to move off this
dichotomy, thinking notjust aboutcomplementary or constitutive
approaches
butratheraboutbothsimultaneously. Makingthisdichotomy multidimensional
providesproductive forthefieldgoingforward.
direction

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128 THE ANNALS OF THE AMERICAN ACADEMY

Twopromising approaches lookatboththeconstitution andoperation ofmar-

ketssimultaneously,usingvery differenttheoretical
toolsto do so. The approach
associatedwithZelizers (2005) "connectedlives"addressesthemutualconstitu-
tionandoperation ofmarkets. Andthesocialstudiesoffinancelooksat bothby
the
collapsing differences between s variedmeanings.
culture It is significant
that
these two approachestake on different kindsof markets.Specificmarkets
becomeshowcasesforparticular perspectivesovertime.Culturalandcontested
commodity markets are frequentlyshowcases forculturesconstitutive effects.
Likewise,financialmarkets areassumedtobe moreeconomically rationalized(or
atleastinstitutionalized),
andso theybecomeforums fordemonstrating cultures
effectson theiroperation. The mainquestionsgoingforward concernhowwe
mightmaketheoretical advancement by challenging the orthodoxy of these
assumptions.We do not yet have goodconceptions about how settlement works
as widercontexts shiftand viceversa.Understanding therelationship between
the"markets-are-culture" and"markets-have-culture"approaches provides fruit-
fulnewdirections.

Note
1. This is an exaggeratedly
homogenizedviewof economics,in lightofworkin moreheterodoxeco-
nomictraditions. A morethoroughtreatment betweeneconomicsociologyand eco-
of the relationship
nomicsis beyondthe scope ofthisarticle.

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