The American spirit: The performativity of folk economics in global financial markets

Abstract

Inspired by Austin's conceptualisation of utterances as performative, that is, they do things rather than merely represent, research has shown how scientific theories can become performative in financial markets. Research also shows that brokerage and investment work is as much about using everyday knowledge of markets as it is about performing scientific theories. We investigate whether and how this knowledge or what Swedberg calls ‘folk economics’ can also be performative. We focus on Borsa Istanbul, an emerging market where market actors perform what we call ‘the American Spirit’ – a ubiquitous folk theory that frames and plots the Turkish market as one that moves in tandem with American and other developed markets – and in the process become better market forecasters. Our findings have implications for the study of folk economics and performativity in global economy and finance.