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Class Notes Theme 1: Social Bases of Economic Calculation Why do people make sub-optimal decisions? o o o Spend more than necessary on interest payments Fail to save adequately for retirement Fail to take advantage of available opportunities
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How does an individual’s social environment condition the kids of priorities they establish for different kinds of spending, savings, or investment opportunities?
Buy books: 1. “Nudge” by Richard Thaler 2. “The social meaning of money” by Viviana Zelizer Theme 2: Inequality and the social organization of retail space How ware race/ethnicity and gender stereotypes reinforced (or challenged) during routine shopping trips? How does the social organization of retail space reinforce existing inequalities? o o By social organization, we mean how people arrange themselves in a shopping space: where they usually go, with whom they interact We also look at how management locates (places) its workers in the space: who is in the stockroom; who is at the counter; who handles the electronics; and who deals with the flowers One book: A sociologist goes undercover at two big toy stores o o o One assessment: Essay on an ethnographic experience o o o Midterm: 25 percent of your final grade A section to define terms How is the store arranged? What kinds of conversations do they have with customers? To what extend are your observations similar or different to the book you read in this theme? One store is located in a richer neighborhood than the other The ethnic/racial makeup of workers and consumers at the stores also differs But selling the same kinds of products
A section of short answers (e.g. read the following scenario and explain how author X’s approach to explaining the phenomenon would differ from author Z’s approach)
-Office hours for professor: Tuesday 2:45-4:45 Theme 3: Collective Identities and Consumption How people use their purchases to establish their membership in a group o o Gender, ethnicity, race identifiers Activism and social citizenship through consumption One assessment: Paper o o 15% of grade Details to come Civil rights by consumption (money as the great leveler) Advancing the group’s standing in society through consumption (indicators of “making it to the top”)
Theme 4: Social Movements and Markets How do social movements change the consumption landscape? Is it possible to shop well to save the world?\
One assessment: Paper o o 15% of grade Details to come
Theme 5: Bringing it all together Thinking about commodities as having social lives o o o They are born, mature, die, resurrected They get sick, receive a variety of treatments, respond to them They interact with other products and people in competition, collaboration, or as a form of expression Thinking about how the culture of a society shapes what can be made into a commodity and how Concluding with the cultural roots of consumer demand (along with social network explanations)
No assessments with this theme Final exam: only based on the second half of the semester after the midterm 25% of grade non-cumulative
Office Hours: Professor Wherry o TA’s o o Sarah Sachs Wednesday 9:45-11:45 in 709 Knox Thursday 2:30-4:30 in 608 Knox Tolgas Kobas Tuesdays 2:15-4:45 in 708 Knox
Key Questions: 1. How do we make financial decisions in everyday life?
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2. What might be done (with the least amount of market distortion) to improve people’s financial decision-making? Part 1: Challenges for Optimal Consumption 1. The status quo reproduces itself (consumer power) A history of obtaining payday loans means that it is highly likely that a person will continue to obtain payday loans 2. Mental and physical well-being are associated with financial health (government intervention) But the language of “choice” and “free markets” means that intervening on behalf of someone who wants greater mental and physical well-being is paternalistic (and changes market incentives) 3. “Fair” arrangements aren’t necessarily desirable (government regulations) Here, fair is defined as randomly distributing options so that the kinds of financial deals and institution available to you is by luck of the draw (Some will better, others worse, off) 4. Let the do-gooders (credit unions and banks with reasonable interest rates for poor people) pay for better advertisement or for space more convenient to the needy (supplier power) 5. So long as people are willing to pay higher interest rates, the market is working fine (free market argument) People are rational and know what they are doing; markets match people with the things they want What’s wrong with out choices? Imagine riding an elephant: you can nudge it, cajole it into moving into a specific direction but you can never fully control it. Our conscious thought is like the rider atop a much larger, much more powerful entity that we pretend to control Situation-specific understandings about what needs to be optimized Economic profit, status, time life expectancy, etc. 1. Intuitive (taking the leisurely ride atop the elephant 2. Deliberate (telling the elephant where to go) 3. Messy Situation-specific decision-rules as
Ways of Thinking
Anchoring -What is the starting point of the assessment? The interst rate that you think is OK depends on the interest rate you are used to paying (indisvidiual level explanation) -The sociiolgocal extension o fthis: the social environment a person operates in shapes the rane of values she thinks of as appropriate or as realistic for some like herself -But anchoring leads to unrealistic assessments People from poor circumstances underestimate. un-verbalize. explicit knowledge. rules of thumb 1. reflexive. Representativeness 1.” -Gut reaction.-Automatic or Deliberative What is deliberative cognition? -The mental act or process of acquiring knowledge or of making a decision that is based on critical. Availability 3. taken-for-granted understanding of “characteristics. rule-following What is automatic cognition? -The mental act or process of acquiring knowledge or of making a decision that is based on routine.a. fast. thinking fast versus thinking slow -Implicit. -Thinking slow versus thinking fast -Explicit. intuitive How does automatic cognition work? -Heuristics – a. people from better endowed situations overestimate. relationships. premeditated. knee-jerk. slow. and entailments under conditions of incomplete information. verbalized. Anchoring 2.11 (not related) . inequality widens Anchors in Time -Consider order 1: [First] How happy are you? [Second] How often are you dating? Correlation: 0.k.
62 (related) -Previous experience with financial services. 15. What percentage of your salary would you like to distribute into your savings account? VERSUS 2a. other Availability -A recent event makes some information seem more than it would have been otherwise it would have been otherwise -Recent earthquake. How does the event reflect the set of salient features of the process that generated it Gains and Losses -We hate to lose something -We hate losing something twice as much as we like gaining something A rule of thumb -Integrate losses -Separate gains -(Repeat this over and over. feels unavailable. 10. How similar are the event’s central characteristics to the characteristics believed to belong to a parent population of events. so preparations for the future skewed in favor of the present Representativeness: Objective vs. know it by heart . 7. and 2. expectations for future experiences with financial services Anchoring How Much -Consider these three options -1. Subjective Probability -Trying to figure out how similar X is to something we already know (call it Y) -In situations of risk. Please select one of the following percentages: 5. other 2b. we miscalculate because ask: 1. Please select one of the following percentages: 10.-Consider order 2: [First] How often are you dating [Second] How happy are you? Correlation: 0. sharp increase in enrollments of earthquake insurance -Availability bias: the future seems far off. 15. 20.
When can deliberative cognition override automatic cognition? -Attention. if the rider on the elephant becomes motivated enough. they approach task deliberatively How. deliberate cognition leads to more mistakes or to surrender Stereotype threat -How attempts to promote deliberative cognition produce outcomes opposite of those intended -Consider the following experiment by Claude Steele and his collaborators The researchers randomly assign undergrads with similar test score [indicator of ability] to two different groups o o o Group 1: Takes a new test but are asked to indicate race and gender just before taking the test Group 2: Takes the same new test but are not asked to indicate race and gender just before taking the test Outcome: The test scores of women and minorities in group 1 are lower than the test scores of women and minorities in group 2 [attention drawn to negative stereotypes] Motivation -If a person becomes highly frustrated with the status quo or if the moral silence of an issue increases sharply in its intensity. or a nudge? Attention -As people become more self-aware (seeing themselves in mirror). she will figure out how to tame the elephant Nudge -Strategies to get people to make more optimal decisions Taking advantage of the status quo by subtly changing it What are the social sources of motivation? . motivation. the person may be spurred to act against the status quo or on behalf of a morally important issue -In other words. attention can work in the opposite direction (not discussed by the authors we have read) If core beliefs (or collective beliefs) indicate that a particular type of person is not as good at doing a particular set of tasks.
o o Status quo is that a percentage of salary will go into a retirement account Present options so that the person is likely to choose an adequate savings rate Anchoring how much is enough to save .
etc) to generate evaluation instruments The instruments do not “naturally” spring up but are worked on. fought over Our ways of evaluating deals could have been something other than what they are now -Social construction of economic calculation How to we calculate? -Calculators. activities -Widely shared with a group (a collectivity) . mateieral culture. collectively-held meaning systems) -To Understand phenomena such as economic calculation we have to examine Two Ways to think about culture -Supra-individual cultural phenomena e. the cost” 9/13/2012 9:09:00 AM -Assumption that price charged to a friend is an estimate of a “fair” price -Relationship between productivity and incentive breaks Overview -Sociologists and psychologists can learn from one another Psychologists focus on individuals (cognition) Sociologists focus on groups and on supra-individual properties (such as culture) Bottom-up (individual cognition.e. abacus. point-system weight watchers. “the price paid by the seller. schools. spreadsheets. etc People struggle within institutions (including government. “the market price” 3. institutions.g. databases. “the price marked on the ticket” 2. i. rules of thumb) Top-down (group properties. media messages. conversations. tithes How we used to talk about culture -A unified system -It lay beneath everything -Became invisible in: Media images Attitude questionnaires Everyday practices.9/11 Price Anchors -Three price anchors 1.
2) -Symbolic boundaries -Values Explicit goals and aspirations expressed by a majority within a group Marking differences between self and others (through consumption) Tacit knowledge E. The Problem with Values -Values not consistently held across members of a group but sometimes what people in the group think everyone else in their group believes is incorrect .g. learning about money. caring for family that might require spending more than one would otherwise vs social status vs social citizenship Multi-dimensions of culture (pt. 1) -Frames -Narratives Stories the lens through which we interpret and categorize our surrondings (making some behaviors more likely) Living within one’s means vs the selfishness. ease of banking and of making investments -Cultural capital -Money is the great leveler? It can only do so much.VERSUS How we think about culture NOW -Not a unified entity within a group -Can be used strategically by individuals -Not latent but manifest -It is visible in: frames through which people interpret the world widely shared narratives embodied knowledge deployed with ease -Culture is inconsistent Multi-dimensions of culture (pt.
But may be recalled falsely Schemata embedded information is recalled more quickly. consumption patterns that do not encompass the total of any one collectively -Collective elements of individual identities Social Classification -The placing of elements into a group to form a comfortable environment Logics of Action -An organizing principle for how people-like-us do things-like-that -How should lending. relationships. Is recalled more quickly 2. Pluralistic ignorance -Sometimes the shared beliefs of the group that are consequential for behave exist in opposition tot the aggregated beliefs of the members within a group Individual Schemata -“knowledge structures that represent object or events and provide default assumptions about their characteristics. Is recalled more accurately 3. saving. is recalled more accurately most of the time but may be recalled falsely (false recall) False Recall -What we remember depends on what we think we usually see -Our assessments of credit worthiness or of soft skills may suffer from false recall The Synthesis: What culture is -Top-down evaluation first Two ways to think about identity -Identities of collectives Share representation of a collectivity.” Schemata embedded information: 1. and entailments under conditions of incomplete information. flag or emblem. and investments be handled? . a census category The elements of existing collective representations Styles of dress.
Differs by group and by their corresponding logics of action -Look at corporations. we should infer that the person is acting in her own interests Two Kinds of Utility -Decision utility Anticipating future shares and making an assessment -Experiences Utility Characteristics of Decision Utility -1. same kinds of technology but different logics of action at Apple versus IBM What do we want? -Utility Individuals make purchases because doing so is useful (utility) If we observe someone do something. Losses are felt more intensely than loss aversion Experience vs. Memory -Combing top-down with bottom-up understandings of what culture and cognition are What are some examples of bottom-up approaches to cultures and economic calculation What are the advantages and disadvantages of bottom-up approaches -What are the implications for financial decision-making? . Events/Situations matter more than states wealth (as carriers or as triggers of utility) Gains or losses assessed relative to a reference point (often the status quo is the reference) -2.
leading to poorer financial health than they have had otherwise What explains it? What can be done? Subject of reading for today’s class List of Terms -Construal -Schemata (DiMaggio) -Pluralistic Ignorance (DiMaggio & Bertrand) -Relational Work (Zelizer) -Channel Factors -Stereotype Threat -Key Question: To what extent do financial decisions connect with the relationships in someone’s life? People process information in different ways Random Facts that are helpful: -1 in 12 households in the US do not have bank accounts -Not having a bank account reducing likelihood of saving -Not having a bank account results in higher transaction costs for paying bills and for cashing checks -Given the numbers.9/13—Mental Accounting & Relational Work9/13/2012 9:09:00 AM Overview -We begin with a basic social problem: many households do not have bank accounts. we should ideally be able to just give people information and then increase the number of people who have bank accounts But it is not that easy Why? Why so many households without bank accounts? -Bertrand et al 2004 want to bring psychology (cognition) and culture together to explain the economics of the poverty Poor people have similar goals as non-poor Poor people differ from the non-p[oor in the means at their disposal to reach their goals Poor people al so may have different lesnes for interpreting and evaluating economic strategies (how culture matters) .
272) o If people keep hearing that everyone is doing X. etc -Pluralistic Ignorance =”mental representations of the *the states/conditions of the world+” that people use to interpret what is going on (Bertrand) The mental represents do not have a one-to-one correspondence with actual aspects of a situation or an event (or a state) But people act as if the mental representation is materially real CONSTRUAL WILL NOT SHOW UP ON TEST -Money is nicknamed or earmarked by virtue of who earned it. X is no longer considered to be a fringe.” (Zelizer) -Examples of money and other exchange media Legal tender Tokens. how they earned it. shaping the construal CONSTRUAL WILL SHOW UP ON TEST “The idea that people act with reference to shared representations of collective opinion that are empirically inaccurate” (DiMaggio. pg. infrequent behavior (through empirically it is infrequent) The sociological counterpart to self-construal=Relational Work -The process whereby individuals differentiate what kinds of relationships they are in by virtue of the kinds of money and transactions they engage in Budget categories depend on social relationships and share understandings about what those kinds of relationships mean Earmarked Money -“Money and other media *of exchange+ are defined as flexible adaptations to multiple social ties. to what purpose it will be put. and who benefits from its use -Earmarked money is a great example of mental accounting (separating money into categories) -Pushes against the theory that money is fungible -People who contribute money into a Christmas savings club are not just protecting themselves (selfcontrol) from using the money for other purposes .Psychology of how people interpret the world -Construal -Schemata =the abstract knowledge structures that guide the interpretation of information. they may act with less inhibition in try to do X. coupons. credit cards.
-“…these accounts also guarded funds away from specific others…the *working-class] women [of the early 20th century] likely relied on the clubs as a valuable institutional device for safeguarding holiday monies from other household members. moreover. especially their husbands…For housewives without access to earned income. but it does -Money from the lottery -Inheritance from an adored grandparent -Salary -Tax Refund -It should not matter where it came from. page 157) -The forms of payments differentiates these top managers from the middle-managers -Other symbolic boundaries: types o purchases made and the direction of the purchases might indicate that a person is a close or a distant relation What is to be done? -Channeling Factors The circumstances that make an outcome more likely (or not) A general term meant to encompass a broad range of “nudges” meant to facilitate Channel Factors Message Only Channeling If people only told about the dangers of payday loans Awareness and attitudes change But behaviors probably won’t If people told about dangers of payday loans and maps indicating alternative services provided at same time Behaviors will probably change Message + Channel . 160) Where it came from—it shouldn’t matter. pg. the segregated Christmas money spared them from what was often considered the humiliating need to extract gift money from their wage-earning husband. child care at exclusive day care centers (Zelizer.” (Zelizer. but in reality it actually does have a large effect/influence Symbolic Boundaries -Top managers: first-class travel.
pg. equal test performance with high SES students when SES not primed -Since identity/culture really matters. 14) -Experiment: Asian women. so too Preferences -Identity as taxpayer rather than identity as a poor person = Earned Income Tax Credit more likely to be sought -Identity as a lender [an acting subject] rather than as a charity case [an incapable dependent] = more likely to seek much needed help Defaults -Will return to defaults in next lecture SALO not PayDay -If we know that poor people tend to get loans that they pay back on payday Why not let the poor keep their habits but practice those habit in institutions offering better interest rates . if race primed (strong at math) performance better on standardized test than if sex primed (weak at math) -Experiment: Low SES. and this threat can distort or disrupt the performance of those individuals” (Bertrand. The threat arises whenever stigmatized individuals’ behaviors run the risk of substantiating the stereotype. we need to do the right priming If Identity Associated with Independence.-Maps of local banks and a specific person to speak to there -Commitment by setting up appointments -If helping people fill out earned-income tax credit (EITC) applications can also require the opening of a bank account to put in -This is paternalism A “nudge” Physical Proximity -Counseling center nearby More people took advantage of counseling Few people took advantage of counseling -Counseling center not nearby Stereotype Threat -“a prevalent stereotype about a group…creates a burden on group members and acts as a threat.
Salary Advance Loans (SALOs) in North Carolina as example 5% of SALO gets deposited into a savings account BIG QUESTION: How do we make welfare enhancements for people that need them? .
000 or more varieties Money difference from one bank to the next. and contrast it with Money as instrument of moral regulation and relationship management -We begin with this time period is strategically chosen: 1870s-1930s Key Concepts/terms -Strategic research materials -Money as corrupting vs. money as moral -Fungibility -The Absolute Model of Market Money (5 assumptions) -The Relational Model of Earmarked monies ( 5assumption) KNOW THE 5 ASSUMPTIONS FOR EACH MODEL FOR MIDTERM Case Selection: Why the 1870s to the 1930s Strategic Research Materials -Opportunistic research opportunities to observe the processes that are usually hard to discern but that manifest themselves with remarkable clarity in a set of events. One state to the next -Money attached to local. geographically specific sites .9/18—Social Meanings of Money Overview 9/13/2012 9:09:00 AM -Zelizer argues that a dollar is not simply a dollar and that predictions that money would overwhelm moral and aesthetic values have not been supported by the historical record -We will review the arguments For money as absolutely overwhelming and corrupting. observations made about National level Before the Civil War -States issued their own currencies 5. or other data -Theories of money being manifested by Strategic time-period where there is a transition from multiple monies to a single currency Observable changes in household budgeting due to sharp increases in average wages Change from above: -Institutional unification after the Civil War -As legal tender adopted a more uniformed form. debates.
authenticity. 29. order it like you would lawn service -corrupting? . 1929) -1957: “In God We Trust” first used on papers money The saying pops up whenever the nation needs unity. faster allocation system dating auctions: mail order bride (consenting adults) Renting intimacy: legalize commercial sex work. but ok for other transactions -Gold: foreign transactions but also for custom duties domestically -Greenbacks not widely used in newly settled West History of God and Money -1864: “In God We Trust” on 2-cent coin -1883: “In God We Trust” disappeared from the coins -1908: Debate to place “In God We Trust” back on all gold and silver coins -1938: “In God we Trust” re-appears on all coins (end of the Great Depression. 2) Money as Moral -Two approaches to Money 1) Money as Corrupting -Why Money dangerous Pervades all areas of social life Annihilates uniqueness. nothing is priceless Auctions for scarce organ transplants: highest bidder healed Auctions for children (instead of adoption): search and select the child you want. etc… Conditions Below: beyond Biological Need to Survive 1) Money as Corrupting. begun on Oct. special qualities What Marx called “the radical leveler” Everything has its price. bid for the good ones.Struggles over money -There were interest groups promoting different forms of money Greenbacks: first paper currency without gold backing had its contingenet of supporters Yellowbacks: group insiting that gold certificated be a primary form of currency “Free silver”: a group insisting that silver as well as gold could act as main currency Matching money with tasks -Greenbacks: not for import duties or interest on bonds and notes. removal of bureaucracy.
but simply that money serves as the most efficient measure of the ‘ordinary motives that govern men in the acts of everyday life (quoted in Zelizer 1994.Moral Regulation Through Money -Whether you pay for something has a a lot to do with your sense of honor -We use the money to demonstrate honorable intentions -An instrument to affirm your own moral code and regulations Expressive. instrumental action (neutral) Leads to commodiification of society An authentic experience as a qualitative evaluation The higher price for the authentic expereience is reducing authenticity to a quantity (amount) A bowl made in a factory for mass production is cheaper than a bowl made by hand -4) “the reduction of quality to quantity” . Sacred Money operates in a realm of profane. pg. 11) o fungibility assumptions Only one kind of money Fungible o o o o -Substitutable -Doesn’t matter where it comes from -A weight or a measure makes its units equivalent and indistinguishable -A gallon of gasoline can come from anywhere -2) Absolutely interchangeable -3) Profance vs. pg. not corrupting -Alfred Marshall (1885): “the fact that ‘when we want to induce a man to do anything for us. 9) Model of Absolute Money -1)Money has no social/symbolic function Money is merely a tool for market exchange It is not going to judge you Restricted to economic domain “what Simmel called its “qualitatively communistic character” (Zelizer 1994. we generally offer him money’ does not mean that generosity or sense of duty has disappeared.
social. but money is thought to transform non-economic entities into market quantities Relational Model of Earmarked Monies -1) Money has social and cultural functions Not just an economic instrument of calculation because it operates in the cultural. but multiple monies: people earmark different currencies for many or perhaps all types of social interactions…” (Zelizer 1994. pg.-5) unidirectional transformation of society One-way transformation: money is not thought to be transformed by non-economics considerations. not money “There is no single. sometimes sacred character Money is not a profane. 19) Matching Monies to Social Interactions -Creating or dissolving social ties -Establishing or maintaining inequality -Establishing or managing individual or group identity -Managing inadmissible conflicts of interest -Making rites or passage -Intimacy -5) bi-directional transformations -4) Value and values as false dichotomy . uniform generalized money.” (Zelizer 1994. instrumental instrument Money is also a social medium Values are not reduced to value Qualitative distinctions are eroded at the same time that new qualitative distinctions are created Singularity and un-exchangeability also possible Not just a uni-directional effect of money and modernity acting upon social and cultural structures “cultural and social structures and set inevitable limits to the monetization process by introducing profound controls and restriction on the flow an liquidity of monies. 18) -3) Deeply subjective. pg. and political spheres of life for a variety of purposes -2) Monies.
services.Matching relations. transactions. etc) -1) uses: what are the different categories of use (budget categories) -2) users: who are the people using the monies -3) allocation system: how is it distributed -4) control -5) sources Why monies matter -Families are not single units where money is equitably distributed . they are violating the boundaries of the relationship type Domestic Monies -Extra-economic factors shape… 1) uses: certain monies for specified uses 2) users: designating different people for different uses 3) allocation system: varies by type of money 4) control: who controls it (role type/ identity) 5) sources: use of money depends on where it comes from apply to domestic money (also gifts. the dole. why would you reject the discount? If they offer it for free. money in an envelope. no cash payment. “fuck buddy” -“joined at the hip” -Less intense but ocmmitted orelationship (with or without sexual benefits) -Hanging out = spending time with one or more partners -Dating = the old-fashioned dinner/movie paid for by the guy -Third party enforcement: overarching or situation specific? -If you can get the same service for a cheaper price. etc) -Third parties enforce categorical boundaries Dating subcategories: -“Friends with benefits”. tit-for-tat. and monetary tender to be traded -Transactions= the way that the media will be exchanged (money in one’s hand. media -Relations=category of the relationship -Media= objects exchanged along with goods.
but mom has no opinion on it Conclusion: -On Thursday. we will go into more detail on domestic monies -Will also consider gift money and poor people’s money -Finally I will g into detail on the embeddedness versus relational work perspective tha t the Zelizer (2012) paper discusses Doesn’t make total sense unless you think about relational model . but what if dad buys a new pair of shoes for the same price. outcomes within families as economics conditions change Some of these outcomes (which ones?) might not make sense in the market money model -Home and family causes mental accounting to go awry -Dad buys a pair of golf clubs and mom gets pissed. possible to have uneven. Therefore. otherwise unpredictable.
”—Robert Nozick -Also should money be given as an incentive for civic behavior Four Parameters of Noxious Markets (Satz) -1. Extreme harms to individual -4.youtube. Extreme harms to society Tyler Cowen: Individuals and Freedom -Individuals and Freedom -What type of person does Cowen have in mind as moral How people demonstrate their morality -To what extent are the people to whom the individual is tied rendered invisible . rites of passage.9/20 Key Terms and Concepts 4 Parameters of noxious markets (not in readings) Embeddedness 4 goals of relational work processes 4 elements of relational packages 9/13/2012 9:09:00 AM Gifts for ceremonies. 12 second mark.com/watch?v=TBmCb7nancc Michael Sandel. Professor of Government. but more “efficient” distribution of bads Main idea: “Always be sure about what you are agreeing to. Harvard The price mechanism as neutral Deborah Satz http://www. Inequality and Vulnerability -3. Weak Agency -2. end at 30:45 minute mark Same number of bads.com/watch?v=8aAZg1-9aS4&feature=reiumfu .http://www. inequality maintenance (or resistance) Morality and poor people’s financial agency Morals implicated in markets -Should we sell citizenship? http://www.” Letting people engage in voluntary exchanges respects their liberty o “It’s wrong to forbid capitalist acts between consenting adults.com/watch?v=1q7_BeEEDVE 5 minutes.youtube.youtube.
p.http://www. like the determination of prices and economic insititutions.” (Zelizer 2012. you have agency Embeddedness of the Market -Mark Granovetter -“…the economics action of individuals as well as larger economic patterns.-Person has agency What does that mean? o If you can walk away from a good deal. are importantly affected by networks of social relationships.youtube.com/watch?v=KXGbCjzmm2M -Not over-socialized -Not under-socialized -Just right Key Insights from Embeddedness -Who you know maters for getting a job Knowing timing of when to apply for a position Knowing areas that will be open Confidence of employer that you’ll be a good fit The cost of searching for information reduced Fine grained information transmitted More of an asset when you can bridge two unconnected groups (gatekeeper) Becoming more central to flows of advice and information -Your social ties matter for how you search for commodities -Network configurations matter for promotion The Why? Of Relational Work -Four Kinds of Justifications Create interpersonal relations Maintain interpersonal relations Transform interpersonal relations Terminate interpersonal relations -These justification-acts are goals of relational work -The meaningful world of transactions Relational Packages . 147) .
loans. 151) -These are ritual performances in which we see money. Distinctive social ties (categories of social relationship) 2. bribe. gifts. Negotiated meanings: shared cultural understandings and moral evaluations (Zelizer 2012. Mother’s Day created (a new gift giving opportunity) High price. users: “designating different people” for different uses/roles 3. sometimes specific items -In 908. practices (for compensation. high intimacy . etc.-Different combinations of the following four components 1. 1997. sources: use of money Gifting Moments -Before the 1900s. uses: “certain monies for specified uses 2. 65) the (negotiated) meaning of the transaction Gender and Social Class -The meanings of gender (not biological basis) -The practices that vary by material environment of social class -“Domestic monies are distinct… “ (Zelizer. Media for those transactions 4. The traditional dole or ‘asking’ method became…not only inefficient but also inappropriate…” (Zelizer 1994. 1994. pg. gift certificates created: specific sum. specified store. but they are called different things Domestic Monies Allocation Systems -Women’s money directed toward collective consumption and trivial consumption -“Changes in gender roles and family structure influence the menaing and methods of allocation of married women’s money. Transactions: interactions.) 3. rituals. allocation system: varies by type of money 4. pg. pg. control: who controls it 5. 77) Extra-economic factors shape… 1. birthday celebrations were rare -After 1905..
1994. pg. 1994. 96)? Why do we tip? -A tip is a form/category of money -Are there other ways to pay servers that might be more advantageous for the servers? Conclusion -On Tuesday of next week we will finish our discussion of Zelizer Will review a list of all key terms/concepts Bring in questions . 1994. Thus. 79) Making Money Value Imperceptible -For money to become an acceptable gift. 1997. not only were gifts marked as transfers for intimates but gifts also served to distinguish degrees of intimacy. 1997.” (Zelizer. 82) -Or its uses had to be highlighted to indicate closeness and care Gifting Rituals to transform cash -Rites of passage monies veil money for bride after cutting her hair burial money for burial society to have individual stay with the body before the burial -Art there concerns that the rites of passage become tainted in noxious markets? Inequality/Vulnerability and Gifting -Ceremony of gift-giving in offices (early 19th century) Recipients wrote letters to their bosses to say thank you and to indicate the use of the gift We don’t tip status equals -A man tipped his barber for years (inequality affirmed) -Barber became proprietor of his own shop. 1997. it had to overcome its “uncompromising objectivity” that “distances and estranges the gift from the giver…” (Zelizer.” (Zelizer. so his customer faced a dilemma “Should he resume his former tipping and thus humiliate his quondam friend. pg. so the man stopped tipping his barber (equality affirmed) -Barber then lost ownership of his shop.-“…etiquette books recommended that expensive presents be sent only by most intimate friends. pg.
cultural understanding -These three come together to make budgeting categories Commion in relational and mental accounting -Budget categories + source funds = economic behavior (individuals vs.9/25 Key Terms/Key Concepts for Theme 1: Automatic cognition Deliberative cognition Anchoring Loss aversion Stereotype threat identity Social classification Earmarking Pluralistic ignorance Relational work Channel factors Strategic research materials Money corrupting vs. ethnicity -Socioeconomic status and family structure -Cultural codes. moral Fungibility The absolute model of market money The relational model of earmarked monies Noxious markets 9/13/2012 9:09:00 AM Relational Accounting -Gender race. groups) How does mental accounting handle moral regulation? -Are there moral concerns in the mental accounting literature (we read) linked directly to how money used? Fair prices? Corrupting currencies? Incompetent calculators? How is this assessment different in the mental accounting literature versus the comparativehistorical account found in Zelizer -What leaders a person to assess a price as fair? .
In the experiment you are asked what you would charge a friend versus a stranger. sometimes sacred character . but multiple monies: peopole earmark different currencies for many or perhaps all types of social interactions. Not Money -“There is no single. You have received a ticket for $10 but the price printed on the ticket is $5. How might we rethink this problem? Telling versus asking for a price? Dydadic tie or bundle of ties? Meanings of money (to what purpose will the money made through the sale of the ticket be put? What about terminating the transaction? Let’s re-design the hocket experiment -What if we combine direct observations of behavior with follow-up questions presenting the scenario? What should we expect to see from direct observations? What might be the protocol for the observations? Why might observed behaviors differ from what people do in a controlled experiment? APPLIED TO POOR PEOPLE’S MONIES: How does relational monies model differ from an absolutized market money model -Zelizer takes us through a grand tour and says that there have been a lot of different perspectives on who should be allowed to handle money 1. pg. 18) What are the different currencies used by poor households How are these currencies matched to different types of social interactions? 3. Money has social and cultural functions -Not just an economic instrument of calculation because it operates in the cultural. unoiform generalized money. Monies.” (Zelizer.Let’s Consider Fair Prices -Think through the hockey example. Deeply subjective. and political spheres of life for a variety of purposes -What are cultural concerns about poor people’s monies? How does money function to teach moral responsibility? What are the political functions of money for controlling behaviors or maintaining order 2. social.
groceries. and the y were ready to back it up by putting conventional charitable cash out of circulation. etc. Money is not a profane instrumental instrument Money is also a social medium with a sacred character o What kinds of earmarked monies are considered sacred? 4. occupation. Value and values as false dichotomy -Value are not reduced to value Qualitative distinctions are eroded at the same time that new qualitative distinctions are created Singularity and un-exchangeability also possible -How are values imbued on AFDC payments.” (Zelizer. Bi-directional transformations -Not just a uni-directional effect of money and modernity acting upon social and cultural structures -“Cultural and social structures set inevitable limits to the monetization process by introducing profound controls and restriction on the flow and liquidity of monies. 1994. 19) What are examples of social structure (socioeconomic status. for example? -How are values used as justification for the generation of charitable currencies? 5. pg. without being monitored? Is it more efficient? Can we cut down on transaction costs by doing so? Can we reduce number of staff it takes to administer these programs? Then why not do it? We see the corruption if its poor people. (Zelizer) Should Welfare Payment be made in cash only? -What do you think> What are the arguments for giving people cash to pay their rent. The needy…should…. but we see it as bad decisions if it is middle class -The logic of gifts and tipping as a gift gets placed in what is happening in government . gender) affecting the limits and controls on the flow and liquidity of money Consider Social Security Payments: SOCIAL SECURITY -1935 Social Security Act: money payments rather than in-kind transfers or vouchers -“The Bureau of Public Assistance thus proposed a revolutionary reinterpretation of the consumer sovereignty of poor people.
com/wathc?v=dKTIJ5Xmb8w . I can tip my barber because he doesn’t own the barber shop and therefore he is not my equal o I would not go to the owner and tip the owner because he is on the same level of job quality as me and that would be weird With or without earmarks -Social Security payments are targeted to a wide range of people (variation in socio-economic status) If these payments become mean-tested and if increasingly going to the poor. is it likely that these payments will remain as cash (unrestricted) funds? How does the socio-economic status and the presumed moral competence of the recipients of official currencies affect the form of money? Christmas Savings Club: Is mental accounting adequate? -Mental accounting: putting money for Christmas purchases into a non-interest bearing account as a way of resisting temptation (lacking self-control) -Relational accounting: what other questions would one ask? How does identity work? -How does identity work in Zelizer as a factor shaping economic decision making? -How does identity work in mental accounting literature as a factor shaping economic decision making? -Are these explanations competing or complementary? Payday Loans -Let’s take a look at arguments “for” payday loans -How would mental accounting explain this? -How would relational accounting explain this? What do you think? http://www.youtube.
you are probably not just paying for yourself but for you and other people in your household -Even when they are accessing private sector sources of funds. and class Then you will participate in perpetuating the social inequality -Interpellation -Intersectionality Ethnography or observational research -Unarticulated needs (and unarticulated beliefs) -People alter their behavior because they know they are being observed http://www.com/watch?v=9tHgNXzS2EY&feature=related .youtube.9/13/2012 9:09:00 AM Theme 1: Wrapping Up Payday Loans -Let’s take a look at the arguments for payday loans -How would mental accounting explain this? -How would relational accounting explain this? -What do you think? -If you have to pay your rent. there is a moralizing element that comes into the uses of the money that doesn’t happen with people who are not poor STOPPED THIS LECTURE AND STARTED NEW LECTURE: Shopping as a Social Phenomenon Overview How does shooppping depend upon and reinforce social inequality? How does comparative ethnographic work enable us to examine inequality in retail spaces? What are the shortcomings of ethnography for this task? o o Key Terms and Concepts -Social organization of space The design of a space affects how people flow through it There may be patterns by demographics The stereotypes for a particular job How they are perpetuated How people come together When you are young you will learn the issues of gender. race.
Using observation to get at meanings -“Soft customer language” http://www.youtube. customer service policies.com/watch?v=704Jnksf2pw&feature=related Getting behind the language of customers who are looking for “competent” and friendly help o How customers define words like powerful It is useful if you are in the space itself to see how the space is rendered Why shopping is a social phenomenon -Three key social decisions Where to buy o Not always about price How to search for/select goods/services What to buy -(At least) three social outcomes How to Shop as Socially-Oriented Behavior -How to shop (how to select goods/services) Management decisions about who is in the front room and who is in back. Store layout signaling leisure or utility Selecting social characteristics of workers. some customers get more attention than others Social networks for information about product and satisfaction Interactions in the store Reacting to our contesting marketing images and stereotypes -Selected goods/services (Bottom-up) Why Economic Sociologists Should Study Shopping -Social inequality manifests itself through consumption -Racial/ethnic identity and gender dynamics manifest -Consumers have to be taught what to desire and how to desire it (desire/demand as socially constructed) Early Study as a Model -Annie Marion MacLean .
http://www. not the wages themselves Mapping Social Space -Think about where people are positioned usually -Where are the check-out counters. windows. the Christmas season -Christine Williams Inside Toyland (2006).htm Observed Social Relations: Games -Participation in games? What kind of decision rules make people ignore Supervisor 2 and go to Supervisors 1 and 3? -Analogous examinations experiments for consumption -The Workplace is a social system Why? . security.analytictech. the bathroom. different prices o Other explanations -Location (easy of entry and exit.” American Journal of Sociology (1899). lost/found. 12 weeks 300 hours 2 stores. food? -Which positions move frequently? .com/mb021/handouts/bank_wiring. the socialization of work. the social conditions of retail work. crime rate) -Self-selection -Shopping services and recruitment/training of workers built into price -Time of year -The shifts worked (time of day and time of the week) -So not a causal argument but a reasonable theory based on empirical data Ideas from production studies applied to consumption? -The Hawthorne Studies Initial studies on effect of light on productivity Experimenter effect? The fact that person engaged in an experiment alters behavior The IDEA of a “fair day’s wage” regulated how hard people worked. 2 weeks 175 hours 2 stores. courtyard. “Two Weeks in Department Stores. within 4 miles of each other but could not have looked more different from each other Same objects.
Blacks. social class.S. typically consent to embrace the stereotypes. and sex Differences in distribution accounted for by individual experience/qualifications -Whites. embodied worker in each job and how workers come to see themselves in these imaginings. since their opportunities depend on the conformity to these managerial imaginings (Williams.…employers carefully pick workers who ‘look right’ for the corporate image they attempt to project to the public. which shape *people’s+ experiences and. sexuality. nation. and age form mutually constructing features of social organization. pg. A suit was brought against the retailer by Asian Americans and Latinos/as who aid they were refused selling jobs because they didn’t project what the company called the A&F look. 55) Can you give some examples of this in Williams’ experience at either Diamond Toys or Toy Warehouse Interpellation (socially constructing the self) -“Leslie Salzinger (2003) has examined how this job placement works in manufacturing plants along the U.” (Williams. A recent court case against Abercrombie and Fitch illustrates this. Workers. perfect equality. 55) Knowing and learning “your place” -Social position is maintained through deference to those above and domination fo those below “your place” -When an individual attempts to change her relative social position. She uses the concept of interpellation to describe how managers imagine a specific. in other words. are shaped by *them+” (Collins. pg. 50) -Latinas are 12 % in retail trade industry BUT Less than 6% in bookstores and gas stations… Over 16 percent in retail florists and household appliances stores (pg.Observed Social Relations: Friendships Concretizes stereotypes -Thought experiment.-Mexico border. pg. 299) -The likely effects of the intersections among race gender/sexuality are historically bounded . pg. she confronts a negative reaction (negative sanctions) Intersectionality -An “analysis claiming that systems of race. gender. in turn. 50) Socially constructed and constructing -“In interactive service work. Latinos. Asian-Americans work in different types of stores (Williams 2006. random career placement People would be evenly spread by race-ethnicity.
Concluding Questions -Visualize a place where you shop often Draw a rough outline of how the shopping space is structured -Hands-on. but if the other people around you don’t think you are one. context. knowledgeable staff? -Racial/ethnic composition of the staff -Racial/ethnic composition of the customers Dress and comportment of customers -Type of person you would be surprised to find shopping there -There are other ways in which inequality can be reproduced Review Session Notes Key terms/Key concepts: (give definition. readymade) You don’t reflect. especially in market behaviors Functions together with automatic cognition to make up human decision-making . deliberate reflection We are not deliberative in every aspect of our lives. Asians are good at math Thinking about every aspect of a problem. nonverbal. It is not personal. and example) Automatic cognition Happens without effort (instinct. your performance suffers o Example. Collectivity is an identity as well They can be passive. they can be active If presented with a negative identity about yourself. it is collective o You can identify yourself as a jedi knight. they are just habitual actions Deliberative cognition Anchoring Loss aversion Stereotype threat Identity 1. then it is delusion 2.
money is entirely restricted to the economic domain Reduces quality to quantity Unidirectional The relational model of earmarked monies Money as social and cultural functions . you spend it on a specific thing you have categorized it for Pluralistic ignorance Relational work Channel factors Strategic research materials Money as corrupting vs money as moral Fungibility The absolute model of market money Idea of embeddedness in the market o o We. as individuals. are born into social phenomena Takes social sphere and economic sphere as two unrelated spheres Always hurts the person when something goes wrong Assumes that everything is calculable (but this turns out not to be wholly true) Money does not have any symbolic function (merely a tool) o Therefore.o Active In an attempt to nudge poor people. active identities will be in power Social classification Earmarking You don’t spend the money on just anything.
etc You mentally project your future income into folders and categories and prioritize them Assumes money is relational . we have monies o o Not just one single type of money Earmarking comes from this idea Money has a tendency to reduce anything to a value The relation between money and the social body is not unidirectional o It is bidirectional Noxious markets Schemes Low/weak level of agency Harmful to individuals and society Inequality in the parties Nudge Paternalistic economic policy-making Influences you to do things (pushes you in a certain direction) Mental Accounting Money in jars o o One jar is for rent. We don’t just have money. one jar is for groceries.
Pediocularity Taking a child’s perspective on the world to market to them An adult’s eye for a children’s environment Pocket Money Always related to a housewife Allowance given from the person who brings home the bacon Commodification≠Commodity Fetishism — Commodification is: Making everything into a commodity among many others Turns people into consumers Everything becomes for sale 5 key words to define with 3 sentences each 3 short-answers 3 longer-answers THEME 2 will barely be on the midterm .
9/27 9/13/2012 9:09:00 AM .
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