On the performative power of financial models

Svetlova, Ekaterina

doi:10.1080/03085147.2011.616145

Cited by 78 publications

(62 citation statements)

References 9 publications

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“…The insight that social relations or even scientific theories gain force only through continuous performance is something that has been developed by economic sociologists (Callon, 1998;Mackenzie, 2007;Svetlova, 2012) and geographers doing social studies of finance (Muellerleile, 2013;Christophers, 2014). Callon has proposed that economists actively intervene in markets through the very same theories they develop to represent markets.…”

Section: Performativitymentioning

confidence: 99%

“…Mackenzie (2007) presents a case of so-called strong performativity, where the Black-Sholes model of options prices remakes reality in its own image by prescribing traders' actions. Svetlova (2012), on the other hand, depicts a version of weak performativity. The traders she studied did not find themselves bound to their price-prediction software: "models are manipulated, regularly overruled by humans and used as tools to obtain the results that their users consider to be correct."…”

Section: Performativitymentioning

confidence: 99%

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Performing nature's value: software and the making of Oregon's ecosystem services markets

Nost

2015

Environ Plan A

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Geographers of technology illustrate software code's contexts, effects, and agencies as they shape urban space and everyday life, but the consequences of code for nature remain understudied. Political ecologists have critiqued remote sensing and Geographic Information Systems (GIS) based conservation projects, but have not engaged more broadly with the role of software in the contested production, circulation, and application of ecological knowledge. Yet, around the world, data analytics firms and conservation nonprofits argue for optimizing environmental management through faster and bigger data collection and new techniques of data manipulation and visualization. I present a case study from the US state of Oregon, illustrating how conservationists and environmental regulators employ computer programming to plan markets in which entrepreneurs restore stream and wetland ecosystem services to earn offset credits. In these markets, code-executed algorithms constituting spreadsheets, web maps, and GIS utilities generate, relate, and make sense of the data that define credit commodities. I argue that code tends toward three effects: producing a landscape defined by wetlands' modeled value, performing social relations associated with nature's neoliberalization and financialization, and legitimating these moves. Although emphasis on the performativity of code and other technological objects is warranted, the contexts in which these are authored, deployed, and evaluated should remain central to understanding environmental governance. This is to caution against seeing technology as reducing nature and society to state or capitalist rationalities and to hesitate to differentiate prima facie code's work on space and on nature. I call for bridging political ecology and geographies of technology in ways that can explain how code is generative of environmental knowledge, change, and conflict.

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Section: Performativitymentioning

confidence: 99%

Section: Performativitymentioning

confidence: 99%

Performing nature's value: software and the making of Oregon's ecosystem services markets

Nost

2015

Environ Plan A

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“…The procedures themselves homogenise, quantify, simplify and centre information; they include and exclude data through the development and application of permissible and impermissible categories; and, in so doing, they influence the nature of their subjects. However, Svetlova (2012) warns against the assumption that calculative techniques are automatically performative. Their impact will depend upon how they are applied within their institutional settings: applications and settings may reinforce or limit techniques' performativity.…”

Section: Valuation and The Form Of The Urban Built Environmentmentioning

confidence: 99%

“…In other words, comparison is integral to explicit DCF calculations. Furthermore, again following Svetlova (2012), there are aspects of the institutional context of explicit DCF valuation that may facilitate and reinforce the effects of comparative valuation on urban form.…”

Section: Valuation and The Form Of The Urban Built Environmentmentioning

confidence: 99%

“…As Svetlova (2012) notes, in order to operationalize the use of this technique to inform investment decisions, appropriate values for the various inputs (incomes, growth expectations, risk as reflected in discount rates and so on) must be identified. Standard property texts suggest that the main source of these input values is comparison.…”

Section: Valuation and The Form Of The Urban Built Environmentmentioning

confidence: 99%

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Financialisation, the valuation of investment property and the urban built environment in the UK

Crosby

Henneberry

2015

Urban Studies

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The financialisation literature has been criticised for its limited empirical base and its failure adequately to link the everyday world with that of high finance. The paper addresses these shortcomings by examining the calculative practice of property valuation. The way that valuations are performed affects their results and, therefore, the operation of the property market. The paper traces the evolving influence of finance capital on the valuation of commercial property in the UK by constructing a historiography of investment valuation since 1960. Traditional approaches to valuation have been increasingly challenged by those derived from financial economics. However, the former remains the dominant method for undertaking market valuation. Its grounding in comparison -a centring and standardising process -offers an explanation for some of the changes in the urban built environment that are ascribed to financialisation. This suggests that a more detailed and historically sensitive interpretation of financialisation is required.

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Inside the halo zone: Geology, finance, and the corporate performance of profit in a deep tight oil formation

Wood

2016

Economic Anthropology

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This article explores the entanglement of petroleum geology and finance with the identification and qualification of tight oil prospects in Alberta. Tracing the corporate history of an entrepreneurial energy corporation on the verge of liquidation, the article explores the calculative agencies and forms of subsurface qualification that matter to making or losing money. Specifically, it illustrates how a financialized geology navigates the sedimented spaces of industry, mapping the very pore spaces of subterranean rock by using big data and other prosthetic devices, such as well logs, in the pursuit of shareholder value. Drawing from science and technology studies perspectives on the performativity of financial models, and connecting those to the emerging anthropological interest in “resource materiality,” (Richardson et al. 2014) this article ethnographically foregrounds how finance shapes discoveries and formats them into the framework of finance, particularly the formulas of “net present value” and “discounted future cash flows,” which are constitutive of shareholder value, corporate profit, and hydrocarbon futures. The article argues that more anthropological attention needs to be given to how these formulas and their fictions work to materialize a financial path dependency on future hydrocarbon liquidation.

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On the performative power of financial models

Cited by 78 publications

References 9 publications

Performing nature's value: software and the making of Oregon's ecosystem services markets

Performing nature's value: software and the making of Oregon's ecosystem services markets

Financialisation, the valuation of investment property and the urban built environment in the UK

Inside the halo zone: Geology, finance, and the corporate performance of profit in a deep tight oil formation

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