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Performativity Rationalized

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  • Francesco GUALA

Abstract

Economic sociologists have been criticized for using the term “performativity” in a way that seems unfaithful to Austin’s notion. In this paper I defend this usage against Uskali Mäki’s challenge, in particular his claim that economic theories cannot constitute illocutionary acts. To counter this claim I argue that performative speech acts play primarily a coordinating role by manipulating agents’ beliefs, and this is the same role that theories like the Black-Scholes model of option pricing play in financial markets, if MacKenzie’s historical reconstruction is right.

Suggested Citation

  • Francesco GUALA, 2015. "Performativity Rationalized," Departmental Working Papers 2015-07, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    • Handle: RePEc:mil:wpdepa:2015-07
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    File URL: http://wp.demm.unimi.it/files/wp/2015/DEMM-2015_07wp.pdf
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    References listed on IDEAS

    as
    1. Donald Mackenzie & Fabian Muniesa & Lucia Siu, 2007. "Do Economists Make Markets? On the Performativity of Economics," Post-Print halshs-00149145, HAL.
    2. Robert C. Merton, 2005. "Theory of rational option pricing," World Scientific Book Chapters, in: Sudipto Bhattacharya & George M Constantinides (ed.), Theory Of Valuation, chapter 8, pages 229-288, World Scientific Publishing Co. Pte. Ltd..
    3. Aumann, Robert J., 1974. "Subjectivity and correlation in randomized strategies," Journal of Mathematical Economics, Elsevier, vol. 1(1), pages 67-96, March.
    4. Donald MacKenzie, 2006. "An Engine, Not a Camera: How Financial Models Shape Markets," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262134608, December.
    5. Bicchieri,Cristina, 2006. "The Grammar of Society," Cambridge Books, Cambridge University Press, number 9780521574907, January.
    6. Donald MacKenzie & Fabian Muniesa & Lucia Siu, 2007. "Introduction to Do Economists Make Markets? On the Performativity of Economics," Introductory Chapters, in: Donald MacKenzie & Fabian Muniesa & Lucia Siu (ed.),Do Economists Make Markets? On the Performativity of Economics, Princeton University Press.
    7. Black, Fischer & Scholes, Myron S, 1973. "The Pricing of Options and Corporate Liabilities," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 637-654, May-June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Performativity; Self-fulfilling prophecy; Finance;
    All these keywords.

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology

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