Veblen, Bataille and Financial Innovation

Abstract

This article advances towards the reconceptualization of financial innovation. It examines the calamitous role of financial innovation in the global financial crisis, developing a non-rational theorization of finance within the social economy that factors in the role of affect. Outlining the foundations for such an approach, the analysis draws on Thorstein Veblen and Georges Bataille, whose work encompasses psycho-social conceptions of political-economic agency. From the more anthropological lens of Veblen and Bataille's theorizations, it is possible to move beyond instrumentalist accounts of financial innovation premised on pecuniary expedients and aspirations of market completion. As we argue, in a broader affective economy, contemporary financial innovation serves invidious ends, providing a means of attaining social distinction, constituting a medium for violent expenditure and bestowing access to sovereign expression on its purveyors. Highlighting the non-rational dimension of financial markets prompts a reconsideration of the nature of crisis and the means of its redress.