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About Time

Something that I did not realise before starting on this project was how absolutely fundamental the question of time is to the study of capitalism and the economy. 


Sure, I had a hunch that the way we relate to time is constructed in one way or another. I had heard stories about how time-zones are a sort of figment of modernity in the sense that they only started to become necessary with the rollout of the railroads. I was vaguely aware that industrialisation brought about new ways of relating to time: it required massive efforts from managers and capitalists to convince workers to work a set number of hours, not just until they deemed that they had earned enough for the day. I was also familiar with the notion that speed is of the essence in financial transactions. The development of high-frequency trading means that micro-second differences can determine profit and losses (to the extent that stock exchanges sometimes slow down their signals to ensure a level playing field), leading firms to pay massive premiums for real estate close to exchanges. 

What I was not aware of is how central the treatment of time is in books and texts on political economy, economic sociology, and entrepreneurship. From Imagined Futures to Capital and Time and The Theory of Economic Development, time appears time and time again.


Of course, if you take a step back, time has a natural place in any theories about the economy. Take the case of a start-up founder desperate for some of that sweet, sweet VC money, for example. When pitching their truly revolutionary idea about the robot vacuum cleaner that makes dust into pizza toppings, this individual uses time as a key resource. Entrepreneurial stories transcend time, existing simultaneously in the past, present, and future. In the past because the stories they tell are somewhat grounded in prior experience (we need to know what a vacuum cleaner is, and how annoying it is to get toppings for our 11-times weekly pizza party); in the present because there is a large underserved market segment (their homes are dusty, they're hungry); and in the future because what entrepreneurs actually sell is less a product than a very particular vision (or imagination) of the future. Any assumptions about the future market cap or profitability of such a venture are essentially shots in the dark, and it is the task of the entrepreneur to construct a palatable future. The same holds for regular lines of credit. Accessing present capital hinges on your ability to convince the creditor that you will have access to even more future capital such that they can make a profit.

As Schumpeter so eloquently put it: 

”Credit provides access to recourses for which no "normal claim" exists.”

This is kind of terrifying, if you think of it. What credit—this fundamental necessity of our present economic system—thus entails is the wholesale reconfiguration of society towards the future. Staying on top requires staying ahead, thinking forward, living sometime else. The present only exists inasmuch as it is part of the future, which means that we never quite live in the present, only in an as-of-yet-not-quite-realised future. The ramifications of this temporal orientation with regard to not least the environmental consequences of unlimited growth should be self-evident, but as a final point I also want to bring attention to the fact that while we live in the future, we also make every attempt to eliminate time altogether.


The single most successful attempt to eliminate time from consideration is no doubt the General Economic Equilibrium model. Most commonly attributed to Kenneth Arrow and Gérard Debreu, this microeconomic model posits that there exists a set of circumstances such that aggregate supply and aggregate demand cancel out, and the economy reaches equilibrium. Such a model of course only works in a world inhabited by perfectly rational homines economici with complete access to all information. If there are no informational asymmetries, there is no uncertainty, and so we thus must be aware of every present and future state of the economy. Given that we have seen time and time again how people's expectations somehow trump this perfectly balanced model (see e.g. every single financial crisis), it truly boggles the mind how this model managed to survive for as long as it has. Indeed, most of the economic profession (for a longer read see Economists and Societies) works tirelessly in an effort to forecast, to predict where the economy is going, to bridge informational asymmetries.


Curiously, these informational asymmetries (in the sense that people are aware that they do not know everything, so they believe instead) have a tendency to create their own futures. The same basic ideas cause both runs on banks ("oh no, the bank does not or soon won't have enough capital to cover my deposits") and VC financing ("yes we believe that this vacuum-pizza guy will be able to cover our metaphorical deposit in the future), and they all entail the bringing the future to the present and the present to the future. In such scenarios, the future and the present are the same (or at least extensions of each other). 


Considering that time plays such an important role in that which I study (or at least serves as an excellent metaphor or proxy for everything else), I think it is a shame that I haven't been made aware of this relationship before. I wanted to elucidate some ways to think about time here, and I hope to be able to elevate the role of time and temporality in my own research.


Some references to consider:


Beckert, J. (2016). Imagined Futures: Fictional expectations and capitalist dynamics. Harvard University Press.


Fourcade, M. (2009). Economists and Societies: Discipline and profession in the United States, Britain, and France, 1890s to 1990s. Princeton Univ. Press.


Konings, M. (2018). Capital and Time: For a new critique of neoliberal reason. Stanford University Press.


Schumpeter, J. A. (1949). The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle (R. Opie, Trans.; 3rd ed.). Harvard University Press.

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