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Accounting for self interest in the credit crisis

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  • Roberts, John
  • Jones, Megan

Abstract

Taking as its starting point Alan Greenspan's 'shocked disbelief' in the failure of institutional self interest to prevent the credit crisis, this paper sets out to explore two related questions. How was self interest constructed in financial markets? And how might we account for its failure? Conceptually the paper draws upon Callon's (1998) analysis of 'agent-networks', the importance this gives to the agency of non-humans, and his complementary notions of 'framing'/'disentanglement' and 'overflowing' as these allow and subvert the calculation of self interest. Empirically, the paper then presents a sketch of these processes in the rise and then fall of the market for collateralised debt obligations (CDOs) that was central to the credit crisis. The final substantive section of the paper reflects on the role and 'hyperreal' interaction of accounting and models as 'mediators' in these processes.

Suggested Citation

  • Roberts, John & Jones, Megan, 2009. "Accounting for self interest in the credit crisis," Accounting, Organizations and Society, Elsevier, vol. 34(6-7), pages 856-867, August.
    • Handle: RePEc:eee:aosoci:v:34:y:2009:i:6-7:p:856-867
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    References listed on IDEAS

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    5. Vollmer, Hendrik, 2016. "Financial numbers as signs and signals: Looking back and moving forward," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 17(2), pages 32-38.
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    9. Dirk J. Bezemer, 2012. "Modelos contables y comprensión de la crisis financiera," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 14(26), pages 47-76, January-J.
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    11. Ferry, Laurence & Zakaria, Zamzulaila & Zakaria, Zarina & Slack, Richard, 2018. "Framing public governance in Malaysia: Rhetorical appeals through accrual accounting," Accounting forum, Elsevier, vol. 42(2), pages 170-183.
    12. Pierre Labardin & Mathieu Floquet, 2014. "Le prix de la valeur et la valeur du prix. Etude des modes de valorisation immobilière dans une grande faillite française (1977-1982)," Post-Print hal-01899221, HAL.
    13. Joannides, Vassili, 2012. "Accounterability and the problematics of accountability," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 23(3), pages 244-257.
    14. Vollmer, Hendrik, 2019. "Accounting for tacit coordination: The passing of accounts and the broader case for accounting theory," Accounting, Organizations and Society, Elsevier, vol. 73(C), pages 15-34.
    15. Vassili Joannides, 2012. "Accounterability and the problematics of accountability," Grenoble Ecole de Management (Post-Print) hal-00676561, HAL.
    16. Barker, Richard & Schulte, Sebastian, 2017. "Representing the market perspective: Fair value measurement for non-financial assets," Accounting, Organizations and Society, Elsevier, vol. 56(C), pages 55-67.
    17. Andrea Werner, 2014. "‘Margin Call’: Using Film to Explore Behavioural Aspects of the Financial Crisis," Journal of Business Ethics, Springer, vol. 122(4), pages 643-654, July.
    18. O’Sullivan, Niamh & O’Dwyer, Brendan, 2015. "The structuration of issue-based fields: Social accountability, social movements and the Equator Principles issue-based field," Accounting, Organizations and Society, Elsevier, vol. 43(C), pages 33-55.
    19. John Roberts & Paul Sanderson & David Seidl & Antonije Krivokapic, 2020. "The UK Corporate Governance Code Principle of ‘Comply or Explain’: Understanding Code Compliance as ‘Subjection’," Abacus, Accounting Foundation, University of Sydney, vol. 56(4), pages 602-626, December.
    20. Jonathan Njoku, 2012. "Surveillance model of going concern in banking," African Journal of Accounting, Auditing and Finance, Inderscience Enterprises Ltd, vol. 1(1), pages 40-76.
    21. Bezemer, Dirk J, 2009. "“No One Saw This Coming”: Understanding Financial Crisis Through Accounting Models," MPRA Paper 15892, University Library of Munich, Germany.
    22. Boedker, Christina & Chong, Kar-Ming & Mouritsen, Jan, 2020. "The counter-performativity of calculative practices: Mobilising rankings of intellectual capital," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 72(C).
    23. Vassili Joannides, 2012. "Accounterability and the problematics of accountability," Post-Print hal-00676561, HAL.
    24. Lambert Jerman, 2015. "Les Enjeux De L'Application Des Normes Ias-Ifrs : L'Etude Des Preparateurs Des Comptes, Une Perspective De Recherche Encore Inexploree," Post-Print hal-01188736, HAL.

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