Where do prices come from? Sociological approaches to price formation

Abstract

The article provides an overview of the state of the art of sociological research on price formation. The dominant trait of the sociological approach to prices is to understand price formation not as the outcome of individual preferences but as the result of the social and political forces operating within the market field. The article proceeds from the concept of market fields and is organized around the three dominant approaches in economic sociology: the network approach, the institutional approach, and the cultural approach.

Re-thinking non-core regions: planning strategies and practices beyond growth

“…Fourth, there are similar, and often overlooked, constraints in economic development and with regard to activities of economic agents: the economy is a social construct (Beckert, 2011;Granovetter, 1985) and can only partially be explained in terms of rational decision-making. Instead, economic decisions are social decisions and reflect wider institutional and discursive constraints (Rodriguez-Pose, 2013) as well as expectations of individual agents, collectives and groups.…”

Managing (Un)certainty in the Japanese antique art trade – how economic and social factors shape a market

“…Informed by recent theoretical contributions by Beckert and Aspers (Beckert 2009;Beckert 2011;Aspers and Beckert 2011) we have focused on three distinct coordination problems that Japanese antique art dealers have to confront: valuation, competition and cooperation. While our discussion of the findings has detailed several economic aspects of these coordination problems, it has also demonstrated how issues of inclusion/exclusion, status, reputation, networks and hierarchy play an enormous role in creating the social order of this particular Japanese market and how these issues impact on the way these coordination problems are addressed.…”

“…In this article we focus on the recent theoretical contributions from Beckert and Aspers (Beckert 2009;Beckert 2011;Aspers and Beckert 2011). Although their approach might be criticized for being somewhat 'flat' sociologically, as social aspects appear to come in only after being bent through the prism of the market, it allows a focus on three distinct coordination problems as sources of uncertainty that market actors need to address.…”

“…Although their approach might be criticized for being somewhat 'flat' sociologically, as social aspects appear to come in only after being bent through the prism of the market, it allows a focus on three distinct coordination problems as sources of uncertainty that market actors need to address. These were the focus of our empirical investigation (Beckert 2011): valuation, competition, and cooperation. In any given market, participants are faced with the uncertainty of assessing the value of commodities (meaning the regard that something is held to deserve).…”

Money: communicative functions of payment and price

“…Economists typically see price as the outcome of supply and demand, but it is also understood as a signal, and Hayek (1945) in particular attributed to price a dynamic, communicative function, describing price as a "telecommunications system" (albeit one that operated only semi-consciously). Within economic sociology, prices may be said to have a social or cultural determination insofar as they can be traced to non-economic factors such as social networks, institutional regulations, cultural meanings, and various kinds of market devices or performances (see Caliskan 2007;Beckert 2011). There is, however, relatively little work in this tradition that explores the communicative dimensions of price directly, although one notable exception is Velthuis (2005; see also Preda 2009), whose work on the art world has shown that prices have (often quite fixed) cultural and symbolic as well as economic meanings, and that they are usually embedded in stories or "scripts" designed to justify and explain them.…”