Constructing Financial Value

As the global financial crisis has demonstrated, market-oriented theories of financial asset values are bankrupt. This project aims to develop and apply an alternative theory, arguing that the value of assets like money, shares, and derivatives is socially constructed: demand for financial instruments is created by narratives that generate expectations of future value, by institutions that bolster these expectations, and by persuading other financial actors to accept them as facts. While such values are often stabilised, they are potentially highly precarious, generating massive risk for our economic system. A clearer understanding of how that risk is generated can help us to develop a finance sector that prioritises social benefit rather than private profit regardless of the consequences.