Stephen Gudeman
(Draft --- Not For Citation)
Representations - the word makes some anthropologists pause and others grimace. Representations is a post structuralist mind-bender. I understand representations to be a relational idea referring to how we make one thing stand in for another. For example, according to some, a model may take the place of "facts on the ground," a flag stands for the nation, a representative stands for office and for her constituency. But there are many kinds of representations, even within a single discipline, and I want to say something about changing notions of representations in anthropology, especially in relation to economics. I shall distinguish three forms of representation but in order to speak of their dia[or tri]logic. Yet, too, I shall address the historical divide between logic and rhetoric with the intent of blurring the division and inverting their importance. But my discussion of rhetoric is oblique, for I come at it by way of an interpretation of the central and foundational representation in economics of the "rational man." Homo economicus is a rhetorical device, but it is an abstraction within a broader notion of reason. Like one of the characters in my Italian buffo, I hope you will accept it with a wink and a nod, which is the spirit in which it is offered.
But is the notion of representations problematic for economists? Why do the disciplines differ in their preoccupation? Here's the problem for anthropologists. Once upon a time, we knew that we could go "somewhere" (distant and exotic), learn the language, live with the people, take notes, find an unusual custom, return home, write up the fieldwork as a "monograph" and gain a degree of fame as the expert on our people. Let's call this the modernist project. Here is a quick guide to that intellectual world and its tools. From Malinowski we learned about the fieldwork process and the importance of speaking the local language (even if the verbal categories were mainly about men's activities); from Radcliffe-Brown we learned that society has a structure and functions; from Evans-Pritchard we learned how an elegant structure, formed around men and patrilineages, age-groups, or spatial domains could be depicted; and from Boas we learned that the human is a total, cultural being, and so requires a rounded, holistic understanding. According to this modernist vision, regnant in the first half of the twentieth century, the world consists of discrete societies that are expressed through culture. There were dissidents, but most of us learned to represent "the world" through terms such as system, equilibrium, functions, ritual escape valves, and personality mechanisms. In the 1960s, Lévi-Strauss stole the stage, and some of us became devout believers in structuralism. Drawing on Saussure, structural linguistics and phonemics, Lévi-Strauss promised that the world of the mind was uniquely accessible to anthropology (by studying variations and mind's operation in ordering space, kinship, myths, rituals, and even politics). Meaning was generated through patterns of binary oppositions. Converted to Cartesianism, to binary oppositions (sometimes cross-cut by a trinary set based on a bit of Hegel), and to a belief that culture represents mind's universal operations, we saw the other great modernists as unenlightened empiricists: they did not see that the gleaming surfaces of kinship systems, food styles, spatial arrangements and myths on which they focused represented a structure that it is the anthropologist's special privilege to uncover and decode - which Lévi-Strauss did with unrivaled panache. From Lévi-Strauss we learned to distinguish "home-made" models (how a people represent themselves to themselves) from that anthropologist's models that represent the underlying structure of things.
I used this exciting, rational method in my early analysis of godparenthood, though the analysis was based on church ideology (or home-made representation). Its application to economics gave me pause, however. Lévi-Strauss - as THE student of Mauss - assured us that social life is made up of three exchanges: we exchange words in social life; men exchange women in marriage (Lévi-Strauss claimed that the "signs" could be reversed); and we exchange things in economy. But I never thought that economy is only about exchange (what about self-sufficiency?), although some anthropologists still think that if they write about exchange they are representing economy. (Enter a parenthesis: did we write about exchange as a result of our "experience" in markets, even if the exchanges about which we wrote were gifting and reciprocity?) With the advent of Marxism and structural Marxism toward the end of Lévi-Strauss' ascendancy, life for the economic anthropologist did seem more grounded, because now we learned that if we uncovered modes of production with their articulations, found patterns of labor exploitation, or displayed how class (intertwined with race and gender) could be discerned within lineage systems, our work was structural, too - or so the French gurus assured us. No one played out the parallel of home-made models and mystification, however, partly because economic anthropologists had not read Lévi-Strauss, but it was an intriguing and disturbing possibility, for it strengthened the anthropologist's claim that he alone was not fooled by the apparent reality of home-made models or market exchange.
So, for me, given the fireworks of Lévi-Strauss, "post structuralism" always means what happened after him - well, as a structuralist how else could I define it? I never did become a structural Marxist, but I was entranced by the elegant, structural rationality of economy first represented by Ricardo.
After the French prince, anthropology took an abrupt turn with the persuasive writing of Geertz. (Sahlins, too, became the rage of this age, for he seemed to have a foot in Marxism [and sometimes his mouth], because he promised to introduce history and a bit of agency into our accounts, but having traveled to France and becoming enlightened at the feet of the master, he remained a neo rather than a post structuralist.) But back to Geertz. At first, we thought he was really like Lévi-Strauss because he emphasized meaning. But we soon found that Geertz had something different in "mind," because he claimed that ethnography is a text and that culture (not structure) is the discipline's defining focus, for "man" is a culture-making being. There is a streak of Weber in Geertz, but he adduced people like Ricoeur, Dilthey, and Gadamer, and seemed to suggest that for the anthropologist the tools of literary criticism were more useful that those of cybernetics, physics and biology. Geertz made us re-tool, and as the discipline shifted from a social science to a humanistic perspective, which was liberating and distressing, our task became to interpret "their" activities and expressions. Evans-Pritchard - perhaps influenced by Oxford linguistic philosophers - had claimed that the anthropologist translates between cultures, which meant carefully expressing their language in ours and vice-versa, but Geertz' vision, bolstered by his flamboyant rhetoric, cut deeper than Evans-Pritchard or even Lévi-Strauss' brilliant maneuvers. Geertz never really addressed the war between logic and rhetoric, or "science" and the humanities, however; and he never considered reflexivity as more than reciprocal winks and nods between people. For Geertz it was turtles all the way down, and a generation loved that - goodbye, foundations.
So, all Hell broke loose, for Geertz aided and abetted the transition to post structuralism, though that was never his banner. The certainties of the prestructualist and structuralist eras disappeared, and we could no longer claim that our representations reflected what was out there, or that our representations reflected their representations, or that our representations reflected anything more than our representations, which was rather solipsistic. Why do anthropology? What were we to do in the field, or say after leaving it? Why not just go to learn about ourselves through a mirror of our choice? I would not identify singular (male) "heroes" after Geertz, although Clifford was certainly a leading culprit, even if he had not undertaken fieldwork! (Another parenthesis: an adulatory book about Lévi-Strauss carried the intriguing title, "The Anthropologist as Hero," but post structuralism/post modernism has no heroes - male or female - because the text and context also write the author.)
What was the poor economic anthropologist to do in this roiling situation? In fact, most of them did not give a damn and seemed oblivious to the changes in the discipline and its disappearing borders. Having written my second book that took off from dependency theory, Marx and post Ricardian thought, I posed myself the question "What is cultural economics?" and began to think about tropes in economic practices. Most economic anthropologists, however, remained caught up in an older way of representing economy that pitted the sturdy individual against institutions, and by passed the emerging problems of translation, understanding and meaning. (After all, doesn't economics "explain" rather than "describe?) The main skirmish in economic anthropology was set off by the economic historian, Karl Polanyi, who distinguished between "formalist" economics (a.k.a. neoclassical economics) and "substantive" economics. The first framework - taking off from the rational actor operating in a market situation - was appropriate for market economy according to Polanyi; the second framework - focused on institutions and exchange - was appropriate for representing "them," the embedded economies that anthropologists studied. The battle was fought across many spaces: if one side was filled with deductivists and rationalists, the other had inductivists and empiricists who promised fidelity to the facts on the ground. The struggle grew especially heated when the formalists - as Becker was later to do - tried to explain and reduce social behavior to individual choice, maximization, and countable, discrete factors within the constraints (externalities and exogenous variables) posed by ecology, state systems, and the frictions of a local social structure. For formalists, reciprocity and altruism, trump cards which had been held by the substantivists, could always be reduced to an expression of self-interest. (Even Bourdieu with his emphasis on the historical and cultural habitus of the individual seemed to agree.) For the formalists, the market person (homo economicus as defined by Lord Robbins) was the moving agent within local economies which implied that all economies were on the road to modernization as we know it, because how could self-interest be denied from asserting itself? The battle which locked empiricists and rationalists within an essentialist epistemology continues today, and it never led the participants to question the division it inscribed between the developed and underdeveloped worlds.
Eventually, exhaustion led to a degree of peace, and economic anthropology rather dried up in the early 1980s after some Sahlins' interjections, and the promises of the modes of production approach were not fulfilled. Certainly, anthropologists offered elaborations on the prevailing paradigms: some incorporated new refinements from economics such as the role of imperfect information, others found reciprocity at work in ever new places. But with the rising influence of Foucault, economic anthropology's space shrank. Formalists and substantivists, rationalists and empiricists, deductivists and inductivists had agreed that the grounding of economy was material life. After Foucault, it became de rigeur - and remains so - to assume that power is inscribed in practices and rationality, for was not rational choice really about gaining power? How - Foucaultians would intervene - could one write about economy in a local situation without addressing the flow of power that often emanates from a larger system we do not control and may not be consciously represented, especially when it is inscribed in our bodies? (And who in my discipline of anthropology wants to appear unsympathetic to the marginal, powerless ones that we seem consigned to study? To be sure, some variation of a political economy approach [developed by Eric Wolf], often fused to Foucault, continues to offer a way of inserting a liberal morality into detached and objective writings, allowing us to subtly complain about all the bads being done to "them," so justifying our presence among them as well as our liberal consciences. Why else do we have such difficulty securing permission to study elites - they know what we are up to - and why do we occasionally study elites except to complain about them?) As a result, "economic" anthropology as a bounded subdiscipline not only became moribund but elided. Those of us who practiced it were ploughing an infertile field. Of course, some tried to pick up on Baudrillard, who mixed political economy with semiotics, but the results seemed as incomplete as the writing was obscure. Thus, the post structuralist revolution set off by Geertz bypassed most economic anthropologists. What difference did it make?
But the Geertzian shift did not mark The End of History in anthropology. Its aftermath led to a more fragmented moment in which we still seem to be entangled. We no longer believe that cultures can be identified as discrete units, some of us even claim that the culture idea itself, our special inheritance from Boas, Kroeber, and the German romantics should be dropped (anyway literary critics have stolen our idea; they seem to think that they can write and teach about culture without doing fieldwork or better my collecting local anecdotes on which they can muse about shifting identities and evaporating national borders. But - and here's the discipline's problem - now that we live in a post structuralist era - sans bounded cultures and disciplinary borders, and enmeshed in globalization - what's left for anthropology?
My objective and neutral account brings us back to "representations." What does this word mean for anthropologists ? I never liked the metaphor that ethnography is a text, because feeling, shitting, interacting, creating, talking, and being influenced and coerced by others makes for a world of interacting representations. Practices are not texts that we re-present in texts, yet they are connected to representations, if only because representations are practices. What's the link of representations ,to economies, and to economic anthropology and economics?
Let's begin with fieldwork which I think is the heart of anthropology. In research, anthropologists undertake two broad activities (or at least some of us do). We observe or watch behavior (we "gaze"), and we talk with people, gaining their reflections and promoting or provoking discussion. The first part can take the anthropologist into gathering numerical data, building typologies, characterizing behavior, or offering generalizations. The second side leads to gathering myths, writing down changes, collecting narratives, and eliciting memories. Both are conversations which is a word I often use, because unlike so many other fields, the anthropologist is always confronted with differences that she must bridge. In the field, we are at the limits of our knowledge, or we should act as if we were at the limits of our knowing. Everything must be questioned or bracketed in the attempt to gain an understanding.
Furthermore, we sometimes find that peoples' reflections do not "match" their behavior - they do one thing, say another - which itself is a practice to be considered. It seems to me that both actions and talking are shot through with representations which vary by individuals and change. I call these representations local models and take them seriously. I do not think that many economic anthropologists work with the idea of local models, and I think that even fewer economists - whether operating in a neoclassical, Marxist, Austrian, or evolutionary framework - do so. I want to mark here, then, one striking difference between the two disciplines: economists today are model builders, which is also a representation; anthropologists are humble (or pretend to be so), because we (I) assume that people construct. We deal with this data that often falls outside the formal models. Consider, for example, unpaid work (especially by women) or the role of household economies in the countryside
of Latin America or the heartland of post socialist Europe. I suspect that "real" economists consider these behaviors and their local explications to fall in the realm of "exogenous" variables or view them as "externalities" that must be commensurated and colonized by their models.
Furthermore, to complicate this problem posed by the local, I (and others - see the work of Bird-David) have found that local models of economy often are built around metaphor - they fall in the realm of rhetoric. These local tropes frequently are drawn from images of the body, family and lineage, or immediate space, such as the house (in the countryside of Colombia the economy is modeled after the house which makes it a true house economy). To make matters worse, local models are not linear or clean cut, for they are mixed with (what we consider to be) other domains, such as religion, rituals and myths. Local models do not fall in the realm of logic; they lack the properties of symmetry and deductibility. For example, in parts of Africa it is said that lineage land is made fertile by the ancestors who first made it productive, so that maintaining good relations with the ancestors and one's lineage mates by enacting certain rituals and respecting their embodied presence in the lineage
chief is part of and essential to a successful material life. (By the by, Marx fleetingly referred to such practices in his discussion of historical economic formations in the Grundrisse.) What a mess! Is this "economy" as we know it? What self-respecting economist will take this sort of data into account? And by what right does this sort of economic anthropologist who writes about local models as Really Serious Things justify herself as writing about economy? Indeed, indeed, when do development types, including economists, NGOs, and government planners, ever listen to these "frictions" that stand in the way of achieving modernization? Let's call these local practices of people, Representations I.
But this is just the beginning of the representational problem, because one aspect of the post structuralist revolution has been to question even the anthropologist's authority to learn, author an account of, or represent local models. Such arrogance! One solution, used by some anthropologists, is to collect a people's narratives (or testimonies) and re-present them to our audience in as unblemished or unfiltered a way as possible. The epistemological objective apparently is to bypass the presence of the anthropologist and question of referentiality, that is, to evade the idea that our texts represent their texts through the device of simply presenting their texts. My way of attending to this representational problem is to see the anthropological text itself as a product of a conversation between ethnographer and people. I think it is nonsense to claim that we represent them in our texts, for the famed monograph or ethnography does not point or refer to "them" but to the interaction or encounter, and the participants in this interaction themselves are composites of their history and context (what I elsewhere [2001] term, their base). Regardless, I observe that most economists do not recognize this problem of representation (let's call it Representations II), because they simply build models that they hope can be tested against or used to predict stable behavior, and adjust to have a better fit, so ignoring the difference between the world of the modeler and that of the modeled. Having largely omitted Representations I from their account, they do not have to struggle with the epistemological puzzles of Representations II.
But now let's rotate the binoculars 180° and look at our texts in economics as representations. We'll call these Representations III. Why not analyze them as products in an intellectual and practical time, or as rhetoric rather than logic? Do they not consist of Representations I and II as well as some logical value added? Could we see representations in economics as reflections on behavior, on local models, and on the legacy of models that is their cultural base? This way of thinking about economic writings hardly demeans them. It makes them into richer products. It hardly cuts the ground from under them; and it does not turn me into a nihilist (as an economic anthropologist once labeled me in public) or into a terrorist as a conference organizer once said about me - nor should a neoclassical economist throw chalk at me as one did when I suggested that the way a people fish cannot be explained by supply and demand, and the "logic" of instrumental rationality.
Where do I fit? I like to explore local models (Representations I), how we write about them (Representations II), and how we explain ourselves to ourselves (Representations III), and I like to look at their interaction or reflexivity. I am suggesting that we are all caught up in the problem of representation. And I guess that is my bottom line, my pragmatism. I enjoy this way of seeing and acting in the world, because it opens up a space to explore. But I am an anthropologist who likes serendipity and accepts uncertainty. And I arrived at this slippery position, this stance that makes me consider my history and subjectivity, through a series of painful steps that have led me from anthropology to economics to philosophy, to history and back. But what does this sort of questioning and reflexivity do? What's the payoff or cash value? Let's parachute an anthropologist into the heart of darkness - homo economicus - to see what she can do.
Rational Man or Reflexive Person? A genealogy of rational man in which rhetoric is silenced by logic.
The core or foundational concept in the modern market discourse is rationality. Isolated and self-interested, the rational person chooses among alternatives by calculating their benefits and costs, maximizing the yield, and ignoring their effects on others. He pursues private gain and uses no-cost public goods whenever possible. When practice does not correspond with the assumptions, modelers modify the immediate definition of self-interest or presume that behavior is affected by externalities, such as imperfect information.
It may be objected that neoclassical or rational choice theory does not capture all that is economics today, but I am claiming that this theory is only one expression of the revolution that has rationality at its core. Today, for example, the theory of the new institutionalists (North 1990; Williamson 1975, 1985), the elaborated model of externalities and the firm (Coase 1988, Alchian and Demsetz 1972), the new theories of Wall Street investing as well as Becker's work (1981) on the family are all expressions of the rationality assumption. Such theorists argue that we either do use (sometimes without realizing it [Friedman 1953]) or should use instrumental rationality in every significant domain from the market to the family, polity, and legal system. In these and related models, the human does not simply supply labor for a wage but provides calculated labor in relation to a calculated wage; the capitalist does not simply seek profits and invest capital but calculates their relation. We do not simply seek friends and spouses but calculate their benefits and costs to us. The components of material and social processes are numerated and ordered, because the human is a rational calculator. Thorstein Veblen, drawing on the German historical school and a pragmatic interpretation of Darwin, stands out as a true dissenter, for he rejected instrumental rationality as the ultimate grounding of the economy and foundational feature of humans (1942 [1898]).
My thesis is that instrumental rationality is a cultural construct and not an inherent subjectivity. I do assume that instrumental practices are common and can be important in production, exchange and consumption. But they are more or less salient across economies, and mixed with other practices. For example, in community formations the end, or maintaining a community of people and ancestors, is often coincident with the means, which are the ancestors in the earth, so that the social activity done "for its own sake" is also an instrumental practice done "for the sake of" gaining a livelihood. The instrumental act is a social performance.
In contrast, the centrality of instrumental rationality in market economy is connected to the presence of uncertainty in trade (although paradoxically calculating reason works only when risk can be assessed and individual preferences or goals can be measured and compared).
In a completely competitive market, prices and goods available fluctuate everyday, and exchanges are short-term. The prices, goods, and exchanges cannot be predicted. Uncertainty is an inherent feature of anonymous trade. But pure markets rarely exist. To counter the uncertainty of trade, people create contracts and communities in markets, such as cartels and oligopolies, and communal agreements around them, such as judicial and accounting (!) systems; and in modern times they largely share the cultural assumption that instrumental rationality is an inherent feature of the species. This construction reduces market contingency by allowing actors to count on the calculation of probabilities or risk in themselves and others. Rational man is a reflexive or intersubjective local model. As Collingwood once observed, economic action is one in which "each party is using the other as means to his own ends by permitting the other to use him in the same way" (1989: 65). If I know that the other is a rational actor, then I can be one as well.
I suggest that in European market life and discourse, instrumental rationality spread as a way of coping with the radical uncertainty produced by the expansion of market exchange. This coping tool had been practiced, by bits and pieces, in material life, then it was attributed to others as to the self in the market, theorized on a philosophical basis, and eventually inserted into the center of the discipline of economics. Throughout this evolution, practices and theory interacted; practical ways of doing things were abstracted and voiced, and these formalizations influenced what people did in a continuing cycle.
A long historical treatment would be required to show how instrumental practices developed in domestic economy, with its practices of thrift or economizing, and in writings about that form of material life. This story could start with early household life, and with Aristotle and Xenophon, continue with Roman writings, estate tracts from England in the late 1200s (such as Walter of Henley), and the development and spread of double-entry accounting in Italy during the 1300s, and conclude with the many rational instruments of the market that developed in subsequent centuries and that we know today.
But I want to make the case for the development of another, more profound sense of instrumental rationality as it is used in economics. Economics is not simply a logical or deductive discipline based on the notion of means to ends action; rather, instrumental reason has become the grounding or shared commitment of market life itself.
The neoclassical or late-nineteenth-century revolution in economics did not simply extend marginalist principles from Ricardo's theory of land rent to all factors of production; it was not simply a use of Newton's calculus to describe the distribution of resources and the allocation of product, nor did it signify the application of other, sophisticated forms of mathematics to material life. The revolution of the late-nineteenth-century was broader, for it lay in the insertion of rationality itself into the model of the market actor who gradually emerged as an individual separated from his societal context. For example, Ricardo - writing in the early decades of the 1800s - was surely the first exponent of the use of rational theory in economics. He attempted to provide a deductive, systematic model of the economy, and he subjected his own models - especially in dialogues with Malthus - to reasoned (though not necessarily empirical) critique.
But Ricardo did not establish rationality itself as the rationale for economic action, even if that was implicit in his portrayal of behavior. The decisive turning came with the neoclassical revolution, after which the centrality of instrumental reason was made explicit by von Mises (1976) and Robbins (1969 [1932]). Instrumental reason in the actor provides the certitude or faith on which much of modern economics and market practice is based. Now, instead of rationality referring to an attribute that an observer may construct and assign to a pattern of thought, rationality has become a putatively innate form of thought (or competence or subjectivity) which we all deploy more or less adequately in material life.
Modern notions of this local or situated model, I propose, though owing to many sources, have an important beginning in Descartes. With a radical skepticism, Descartes at first brought into doubt all knowledge, all convictions, all philosophy. But this very act of doubt allowed him to find an absolute foundation for knowledge itself because universal doubt had to be carried out by an ego, and this self had to be excluded from such doubt. Absolute doubt, in this sense, led Descartes to the conviction that the one clear grounding for knowledge was provided by the thinking ego, which itself excluded doubt yet could bring into doubt the experienced world. Thus Descartes, through his radical skepticism, came to the conclusion that the singular foundation for knowledge was the indubitable certainty of self; by excluding this ground for doubt from doubt itself, Descartes was able to provide a foundation for universal knowledge and judgment within the thinking being.
As Husserl (1970 [1954]) explains, this new way of knowing the world led to the modern mode of philosophizing and penetrated ever more fully into the European spirit. The divisions between mind and body, subject and object - dualisms that are deeply embedded in the modern discourse on economics, with its bodiless agents and passionless calculators - are built on the Cartesian presumption. The mind of economic man, external to feeling, sentiment, values, and relationships, observes them to determine and order preferences for which it selects the means most appropriate for their satisfaction. By means of the Cartesian assumption it becomes possible to postulate an ideal, rational individual who, acting outside history and society, perfectly performs rational calculations. (Again, at this point in the simplified genealogy I am leaving aside means-ends or instrumental reason itself.)
Husserl questioned Descartes's dualism and assertion by showing that it took for granted the Galilean-Newtonian view of the world as a separate, enclosed system of interacting physical bodies, and that the concept of the thinking ego was a result of this formulation that disconnected objects from subjects, nature from humans. The alleged clear and certain grounding afforded by the Cartesian mind and soul was a deduction and abstraction within the mathematical construction of nature established by the Galilean revolution.
Husserl, by placing the Cartesian revolution within the context of Galileo's ideas, draws attention to its intellectual and philosophical rooting in a world where certainties provided by God were being questioned. Recently, Toulmin (1990) - tracing the turn to modernity and to essentialism in Western thought - provided a new account of the rise and wide acceptance of Cartesian epistemology. He argued that Descartes's relentless search for certainty was a response to the unstable political and religious conditions, epitomized by the assassination of Henry of Navarre, in which Descartes found himself. Toulmin's more situated (and rhetorical) argument explaining the rise of Cartesianism is persuasive, but he omits consideration of the rapidly changing material life of the time and the reasons for the eventual, widespread acceptance of the Cartesian view as our "common sense" and a depiction of everyday life. Political situations and conditions have varied over time and by governmental form, but Cartesianism as an aspect of Western modernity spread widely and without surcease.
I surmise that the Cartesian revolution may be seen not only as a response to the growth of scientific thinking, the increasing independence of philosophy from theology, and the rapidly changing political climate but also as a response to the uncertainty and increased presence of "the other" created by the growth of markets in early modern Europe. Though it is far beyond my brief to trace these real-life changes in Europe during the seventeenth and eighteenth centuries - Braudel's historical work (1982) is magisterial - I do argue that the acceptance and spread of Cartesian thinking was linked to the expansion of market life.
In this lengthy development, the interaction of practice, reflection, and written discourse involved acts of modeling and metaphoric projection. As markets expanded within nations and across their boundaries, trade more and more took place between people who spoke different languages, held different metrices of valuation, and operated from incommensurate systems. Material life grew increasingly dependent on unknown and unpredictable others who provided and traded the goods that met one's needs and satisfied one's growing wants. The realm of the self as defined through community diminished. The opposition between self and other, emerging from the market experience, provided the image of the knowable and the uncertain.
Project this practical experience of the market relation on the human, and mind becomes self, body becomes other. The first can be known with certainty, the second cannot. Then, reproject this image on others in the market, and one may assume they are rational individuals also - who use one as one uses them. The image of the new individual, drawn from market experience, became an expectation of others in the market. This local model was reflective, and in scope and detail, the construction process was Vichean rather than Cartesian:
The human mind, because of its indefinite nature, wherever it is lost in ignorance makes itself the rule of the universe in respect of everything it does not know (Vico 1970 [1744]:28).
From this combination of market experience and the search for certainty, the reasoning actor was crystallized and became a shared commitment in the culture of the market. The concept of the reasoning actor is a human tool and outcome of cycling among practices, reflection, writing, and experience as a way of structuring unruly market transactions. Neither "default theory" nor natural touchstone, the reasoning actor is the consoling tool of last resort when community seems to disappear. Market participants are socially disconnected competitors but knowable beings, for they are rational beings, also, in the market community.
The rationality assumption provides clear insight into the motives of others. It affords the in-sight of a Benthamite prison or Panopticon by which a single prison guard, located in the hub of a circle of cells, can observe all the inmates because the light that passes from one end of a cell to the other reveals their movements even if in black and white (Bentham 1791, Foucault 1979). Similarly, the market participant, able to see into the behavior of others through the assumption of rationality, can control their behavior "by getting the incentives right." And when the incentives are right, the market achieves clarity, that is, it clears.
There is a second moment in the development of this local model, the intervention of Bentham. Beginning with Bentham's utilitarianism - his "felicity calculus" or account book image of the human - in the late 1700s, and culminating with the rise of marginalist economics toward the end of the nineteenth century, the models in economics witnessed a radical transformation. The nineteenth-century neoclassical revolution represents the realization of Cartesian cum Benthamite economics. According to the modelers, the economy is made up of bodiless and timeless minds - without substance, affect, life, or death - that calculate similarly. This commensurability underpins the havoc of free exchange: environments, resource endowments, and personal preferences may differ, but as Cartesian egos as calculating selves, humans are the same. And this shared foundation promises systematicity in the economy - especially if the participants themselves come to share the local view of the modelers.
This rational actor model permits the formation of stable expectations, converting what otherwise might be unpredictability in others to measurable probability. And on this assumption that the market is a realm of calculable risk (as opposed to uncertainty), the regnant values of efficiency and optimality must stand.
The cultural assumption of instrumental rationality provides a way of disciplining the vagaries of the emotions and passions, and of banishing their disruptive effects in the theory of economy and to a lesser degree in practical life as a consequence of the theory itself that trains and disciplines "men of affairs" who are confronted by the contingencies of practical life against which the theory rages. Emptied of all passions but the desire to optimize, devoid of "animal spirits," lacking in the confidence of an entrepreneur, the human is constructed and conceived as pure Homo economicus. Love, desire, and human sociality do not matter, for they are not required in this explanation of behavior and would disrupt its predictability. They are externalities to mind. Indeed, a market's "externalities," a concept much employed by modern economists, are a metaphor of mind's exterior and part of the dualism:
mind : body ::
res cogitans : res extensa ::
rationality : passions ::
economy : externality.
The adoption of this mode of thought in market models and practice is one way of coping with the uncertainty presented by a competitive market and the presence of otherwise unpredictable others. In the trading context, each encounters the other as a means to attain something else, and this reflexivity provides the ground for the local model and its persuasiveness.
The search for certainty, that starts with Aristotle's model of community and continues - with the rise of markets - through the mercantilists, the Physiocrats, Ricardo and Marx, culminates with the assumption of means-ends, calculational reasoning, though at a cost, such as excluding ties of mutuality, encountering paradoxes like the Prisoner's Dilemma, and inscribing a gendered dualism (Jaggar 1983). The division between subject and object, mind and body, inner and outer, discipline and passion has provided one way of constructing Western patriarchy by linking mind and discipline to those who participate in the market. Passions and the body as inferior and uncertain sources of knowledge must be brought under control of the rational market ego who usually is a male. Rigged to the market, the Cartesian duality of mind and body often has been projected on gender to produce and justify an asymmetric power relation between male and female.
The modernist assumption that the market realm is invested with rational action is a local model, yet it describes a deculturalized individual who must be situated with cultural resources, preferences, and wants even while standing outside these particularities. Instrument of last resort when mutuality seems to disappear, the model of the rational actor asserts the presence of a timeless human core while denying its own fabrication by humans. It is a modern representation.
To be continued - the rational actor in the market is a local not a universal model built around utilitarian rationalism. This model of the person is - in the terms I use - the sacra, the foundation, part of the base that makes up the foundation of the neoclassical market. It has a combined, not a deductive form. Part of the rhetoric, not the logic, of the market, it has emerged from practices, reflections and their interplay.
How is it learned? The use of money itself a rhetorical device may lead to a calculating subjectivity……
After the Modern Individual: situated reason and the connected person
What will a post modern model of an economic actor and agency look like? Technique, craft, invention as part of the reasoning person in relation to others and community.