Something new: value and change in finance^*

* I’ve adapted much of this article from parts of my doctoral dissertation (Souleles 2015a).

ABSTRACT

Ethnographic and social scientific accounts of the financiers that buy and sell companies for profit often homogenize the players in these social dramas, relying on blunt, totalizing definitions of culture or overly deterministic articulations of habitus. This article, drawing on a two-year study of private equity investors, offers an alternative analytic frame for making sense of how private equity people buy and sell companies. It explores the ways in which private equity people make arguments persuading one another and the larger public that an investment is worth making. Important to these arguments are not only substantive content, the evidence that investors marshal to support a thesis, but also reflective evaluation of what counts as good evidence, meta-commentary. It is in these split levels of analysis that we can appreciate the cultural diversity within finance, Wall Street, and investment banking. I will also suggest that understanding how investors are arguing substantively as well as meta-pragmatically begins to outline a useful theory of culture change within the world of investment banking.

KEYWORDS:

• Private equity
• finance
• ethnography
• society
• economic history
• agency

Disclosure statement

No potential conflict of interest was reported by the author.

Notes on contributor

Daniel Souleles is a lecturer in the Department of Anthropology at Brandeis University. He has done past fieldwork with Catholic Hermit Monks and New York-based Private Equity Investors. He is currently studying the formation of employee-owned companies, and is answering questions about wealth, work, and inequality in American society.

Notes

* I’ve adapted much of this article from parts of my doctoral dissertation (Souleles 2015a).

1. The purchase of companies varies year to year. Wilmer Hale report 28,829 companies bought/sold in 2012. Extrapolating forward this is good enough to estimate 2013 company purchases and then private equity's proportion.

2. Geertz says that Thomas Kuhn had an embroidered version of this motto hanging in his house (2000, p. 166).

3. In a different time, ten months in 1992, and a different place, Shanghai at the inception of its stock market, Hertz (1998) reported on the way in which the Chinese state structured market interaction and participation. Fever dreams of the free market aside, accounts like Hertz’s and mine point out the ways in which finance, in the forms that we know it, is always allowed for, sanctioned, and in many ways protected by state regulation.