Challenges of balancing scholarly engagement and critique: A reflection on social studies of finance

By Suhaib Riaz. *

“Socializing finance” has become shorthand to describe the research that several scholars (including me) are engaged in related to social studies of finance. This stream of work involves: bringing finance into the realm of social studies; but also making the industry aware of other ways of thinking and doing, beyond their current status quo; this also often has an element of (social) interaction with the industry thrown in. All these are consistent with various meanings of ‘socializing’ and are much needed efforts.

But there is a flip side to this aspect. How critically aware are we that finance is also on a mission to socialize us – in the sense of influencing our thinking – even as we may attempt to ‘socialize’ it?

In my work (in collaboration most prominently with Sean Buchanan, Trish Ruebottom, Madeline Toubiana) and that of a few other scholars, this seems to be a theme too powerful and important to ignore.

Finance is indeed at work to socialize us – to influence our ways of thinking about it through various means. At the peak of the financial crisis, various categories of elite actors seemed bounded by these ways of thinking about the financial industry resulting in configurations of positions often in favor of status quo (see Riaz et al., 2011). More specifically, financial industry leadership may well see it as their task to defend the institutional framework in which the current version of their industry thrives; and accordingly work to ‘socialize’ the rest of us – all stakeholders- to accept their view of finance and its role in society as the ultimate one by claiming epistemic authority in this domain (see Riaz et al., 2016).

Why is it so difficult to rein in Wall Street?

Suhaib Riaz, University of Massachusetts Boston; Sean Buchanan, University of Manitoba, and Trish Ruebottom, Brock University.

Reforming Wall Street has become a key issue in the ongoing presidential primaries.

Bernie Sanders in particular has used his rival’s close ties to the financial industry, including speaking fees and political donations, to suggest Hillary Clinton wouldn’t rein in Wall Street. At the same time, Sanders has tried to highlight his own independence, declaring:

If I were elected president, the foxes would no longer guard the henhouse.

Clinton has tried to dispel the notion that Wall Street donations affect her judgment or independence, claiming her regulatory plan is actually tougher than Sanders’.

These exchanges underscore a crucial point: almost a decade after the 2008 financial crisis, the reforms that many Americans have demanded remain incomplete. Claims of independence, including by Republicans such as Donald Trump, are one way for candidates to suggest that they would be able to bring about real change.

Who would be the best candidate to do so is an important question. But first we must understand this underlying dilemma: why has it been so difficult to reform Wall Street following the worst financial crisis since the Great Depression?

This led us to a more fundamental question: whose voice matters most in determining how the financial industry should be run?

Given how much anger there still is at Wall Street, the answer may be surprising.

The Force of Political Economy Awakens at UMass Boston

By Keshav Krishnamurty.

Two weeks ago, UMass Boston played host to the Academy of International Business (AIB) US-Northeast 2015 Frontier Conference themed “Bringing the Political Economy back in” (October 22-24), facilitating a broad discussion and engagement on the issue of Political Economy and International Business amongst leading academics from top universities across the world. The first highlight of this conference was the panel “Challenges to International Business Research: Bringing the Global Political Economy back in”, featuring panelists Mona Makhija (Fisher College of Business), John Cantwell (Rutgers University), Rajneesh Narula (University of Reading, UK) and Ravi Ramamurti (Northeastern University), with Suhaib Riaz (UMass Boston College of Management) as the panel moderator. This panel underlined the great importance of political economy perspectives and raised some fundamental issues for future research.

Disney’s Magic: The Business of Organizing and Managing Culture

By David Levy.

As Stephan Manning commented in a recent blog post, many of us who attended the recent Academy of Management conference in Orlando, Florida, felt some of the discomfort of the fakeness of the place, the endless “have a magical day” greetings from overly perky staff (“castmembers”, in Disney’s Orwellian newspeak), the over-engineered physical environment of artificial beauty with an enormous carbon footprint (the steady stream of planes arriving, the acres of over-air conditioned buildings – but you save the earth if you hang up your towels!) Parallels with the TV series The Prisoner or the classic movie The Stepford Wives jump to mind (indeed in the book, the leader of the men’s club is a former Disney engineer).

Corporate Power in an Age of Global Value Chains

By David Levy.

Gerald Davis and Israel Drori make the provocative argument in their thoughtful piece, After the Collapse of the Large Corporation – Progressivism 2.0?, that the era of powerful, large corporations able to provide long-term economic security for employees is over. If the corporate giants of the last century required a strong, centralized government to provide adequate regulation and countervailing power, Davis and Drori contend that we need new models of governance for an era of fragmented, networked economic forms. While it’s undoubtedly true that economic activity has become more disaggregated in the internet age, the demise of the large corporation, and more importantly, of corporate power, has been greatly exaggerated.