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Policy and profession in

economisation processes

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Economisation

• «Rather than asking what ‘the economy’

(noun) is, there has been a shift towards

defining observable criteria which enables one

to say that an activity, behaviour or institution

is ‘economic’ (adjective)» (Caliskan & Callon)

• How is something made into an economic

entity? By what means?

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Examples

• «Things in the market, agencies, encounters,

prices, market maintenance»

• The study of «market devices»

 – Algorithms, trading robots, price calculations

• Basically, tools

 – These can be followed

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How is this innovative?

• Contrast to other economic sociology, which

(sometimes) presumes a fixed social context

 – Embeddedness

• Following the materiality can account for

changes in the economy

 – New tools, new methods lead to a new economy

 – Look for change in unexpected places (Muniesa)

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Questions

• Where are professions in this?

 – What is the difference between an economist and

an engineer?

 – Could professions be defined by the tools they

use?

• What about not-markets?

 – Re-regulation

 – Over-emphasis on market actors?

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The electricity sector in Norway before

Utility

Production

Maintenance Investments

GridCustomers

Maintenance Investments

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Then

• Regional monopolies

• Prices determined by

Parliament

 – Ideas of control

• Based on engineers’

predictions of long-term

marginal cost

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The electricity sector in Norway now

Production utility

Investments Customers

Income from sale of electricity to customers (also,other utilities and abroad). Low costs

Maintenance

Grid company

Maintenance Investments Customers

Income from grid tariff. High costs

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Now

• Price set in market for

production utilities

• Economic tools taken

over – Consumer price

information

 – Electricity trading

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Traders

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Consumers

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Economisation?

• Low price elasticity

• Few care about price arbitrage

 – But many care about prices

• Still, economists have had their way

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But what about the grid companies?

• Still «natural monopolies»

• Income strictly regulated to avoid misuse of 

monopoly status

• One example: «Complaints regarding

decisions about income roof for 2007» (NVE

200802911-12)

• Site of battle

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TI[year] = IR[year] + KON[year] + E[year] - KILE[year] 

IR[year] = 0,5K[year] + 0,5K*[year] + JP[year] 

K[year] = (DV[year-2] + KILE[year-2]) ∙*year+

*year−2+ + NT[year-2] ∙

P[year] + AVS[year-2] + AKG[year-2] ∙ r[year] 

Property tax

Grid costs

Delivery loss

compensation

Allowed income

Income roof 

Cost basis from company

Cost basis from NVE Investment addition

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Who is in control here?

• Engineers?

• Economists?

K[year] = (DV[year-2] + KILE[year-2]) ∙*year+

*year−2+ + NT[year-2] ∙

P[year] + AVS[year-2] + AKG[year-2] ∙ r[year] 

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Legal considerations

«Basically, it is not an

Energy Act at all *…+ It

might work as a market

law, but for regulating

the production of 

energy, it is no good»

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Some thoughts

• Following the tools yields some insights

 – But care must be taken

• These sites of battle are far away from

participatory democracy

• «We can never simply ‘calculate’ because we

must do so with units and instruments of 

measurement that are deeply structured by

accounts of what can be of value» (Stark ‘98)