To an economist, real life is a special case Economist jokes, WWW

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1 Antipode 32:1, 2000, pp. 4 9 ISSN INTERVENTION WHAT KIND OF ECONOMIC THEORY FOR WHAT KIND OF ECONOMIC GEOGRAPHY? WHAT KIND ASH OF ECONOMIC AMIN AND THEORY? NIGEL THRIFT Ash Amin* and Nigel Thrift** To an economist, real life is a special case Economist jokes, WWW The Problem It seems to us that a turning point is being reached in the history of economic geography, one which involves both matters of high theoretical principle and pragmatic decisions about allies. That we have reached this point is probably no bad thing given the lack of appetite for economic geography, at least in Britain, among many new recruits to geography. In the heady days of Marxist geography, everybody wanted to brush with the economic. Now postgraduates often recoil from it; they see it as the preserve of anoraks, and they speed off to taste the alternative delights of cultural geography as soon as possible. Meanwhile, new university posts in economic geography are hard to fill. The subject often seems to be perceived as narrowly specialised, increasingly focussed on industrial districts, learning regions, clusters, and the like. It is also perceived as unexciting; it fails to fire the imagination, yet alone connects with the historical concerns of political economy, such as growth, development, *Department of Geography, University of Durham, Durham, England; ash.amin@ durham.ac.uk **School of Geographical Sciences, University of Bristol, Bristol, England; N.J.Thrift@ bristol.ac.uk 2000 Editorial Board of Antipode Published by Blackwell Publishers, 350 Main Street, Malden, MA 02148, USA, and 108 Cowley Road, Oxford, OX4 1JF, UK.

2 WHAT KIND OF ECONOMIC THEORY? 5 inequality and power. The broader normative and conceptual relevance of economic geography sometimes seems to have gone missing. The critical question is whether this turning point will help to revive economic geography as an imaginative, relevant, and socially useful subject. The answer depends on the direction the discipline takes and the kind of economic theory that is practised. However, certain parts of economic geography still yearn for a rapprochement with formal economics and economists. And we would be the first to admit that there are undoubted attractions. We can list just a few of them. First, economics is still often thought of as the linchpin of the social sciences. Second, economists are close to certain policy communities they have influence and power. Third, economics is clearly about something that, from centuries of cultural workouts, we all know and constantly name. Fourth, economics stands for a certain kind of rigour; its emphasis on well-defined models of limited domains is attractive. Fifth, economics also stands for a certain kind of confidence; economists often seem to be less beset by doubt about the world. Of course, these attractions are caricatures, as shown by any glance at the current debates in economics on the problems of graduate recruitment or economic methodology. However, even if we take them at face value, we would still argue for caution. Why? Well, first, because of lack of fit. The kinds of theories and methods produced recently in economic geography bear little relation to the kinds of formal cause-and-effect models let alone the assumptions used in large parts of mainstream economics. Not only are there rather few people left in economic geography who have these skills (not that there were many to begin with), but economic geographers have also developed their own skills base depending upon the understanding of open systems, appreciation of context, and qualitative techniques. Second, economic theorisation is no longer the sole preserve of economics; indeed, quite the reverse is true. What is striking about the current state of the social sciences is the explosion of work on economics by scholars who either have left mainstream economics to found new domains of knowledge or do not have formal backgrounds in economics. The rise of work on evolutionary political economy, economic sociology, feminist economics, parts of environmental economics, cultures of economies, consumption and material culture, organisation theory, many aspects of management studies, and so on let alone all the practical expertise in alternative forms of economic practice all constitute examples of the rise of economic knowledges outside economics (Thrift, forthcoming). Third, to us it is chiefly in these new outside areas that economic geographers can make, and indeed are already seen to be making, a worthwhile contribution.

3 6 ASH AMIN AND NIGEL THRIFT Two Examples: The Geography of Firms and Money To make these points clearer we will point to two examples out of many possible ones, one macro and the other micro. Lest it be thought that a heterodox account is better suited to explain the workings of the microeconomy one of the likely retorts of economic geographers keen to apply formal economic models let us take the macroeconomic example first. And what better example could we have than international financial markets? One thing we can see in these markets is a coalition of interests intent on understanding the construction of time in international finance and how a short term synchronic time sense the preserve of a quite narrow and specific technical network has been able to become hegemonic in the global economy, producing a change in the cultural consciousness of how the global economy exists and takes shape. This change can be indexed by the increasing description of the economic world in words like fast, speedy, agile words whose increasing currency in the everyday life of the economy only confirms that this is what this everyday life is like. Acting into the words confirms the discourse and makes a new real. In turn, the range of what can be contested gradually and significantly diminishes as a new time sense is quite literally instituted across space. Sinclair (1999) has identified three ways in which such discourses are made general: government departments responsible for finance preach a law of inevitability; experts including economists, management consultants, and the like form bodies of knowledge which constitute their own object; and market behaviour itself seems to provide empirical demonstration through its manipulation of information and communication technologies (rather than, as in some accounts, information and communications technologies manipulating market behaviour). The study of the diffusion of the new time sense comprises a broad and growing church in which economists have understandably had their say (especially through studies of the microstructure of financial markets but also, more recently, through debates on new financial architectures), but which have also been the subject of a good deal of equally important work by economic sociologists, social psychologists, anthropologists, political scientists, geographers, and so on. And, in turn, we are beginning to be able to see far enough into this time sense to see out of it, to see how the discourse can be deconstructed as well as constructed. Our argument has relevance also in microeconomic analysis. Let us take the example of the theory of the firm. Almost every economist now recognizes that the firm is more than a processor of information and efficient manager of transaction costs. Above all, it is a source of core competencies that define the competitive advantage of any given firm. The competence-based perspective places a premium on how firms acquire or generate new knowledge tacit and formal and how they maintain and adapt their competencies in a changing and dynamic competitive

4 WHAT KIND OF ECONOMIC THEORY? 7 environment. Here the literature has moved well beyond formal models of technological innovation and learning into the territory of evolutionary and institutional economics, to identify the role of habits, routines, conventions, path-dependencies, variety in the selection environment, and so on as key influences on the pace and direction of learning and adaptation in firms. Economic geographers have made a central contribution in their turn through their work on the effects of proximity, distance, and local context on, let us call them, the softer sources of innovation. However, it seems that even this degree of broadening and softening of economic analysis does not suffice. The competence-based perspective does not get us close enough to the micro-practices in firms that nurture, sustain, and even compromise everyday learning. If we think about it, firms especially large, complex, distributed organisations avoid the peril of failure at every turn through the daily interplay between procedural and recursive knowledge among individuals and groups within firms. More positively, this daily practice is also the source of learning, in forms of knowledge generated through practice, social interaction, and action. To understand such learning, and its economic effects, we need to appreciate the anthropology of communities of practice in firms. Every organisation is made up of many communities of practice in which learning is not a matter of conscious design or formally recognisable cognitive frames but of new meanings and emergent structures arising out of common enterprise, experience, and sociability learning in doing. In his brilliant longitudinal study of insurance claims processors, Etienne Wenger (1998) explains in part how learning in doing works. He has identified three infrastructures of learning that potentially have enough novelty, perturbation, and emergence in them to sustain both incremental and discontinuous learning. Together they draw upon a staggering range of facilities, practices, and conventions (lest we are inclined to reduce learning to a few manageable or formal devices). The first infrastructure is engagement, composed of mutuality (supported by such routines as joint tasks and interactive spaces), competence (supported by training, encouragement of initiative, and judgement), and continuity (supported by memory locked in data, documents, and files as well as memory unlocked by story telling). The second infrastructure is alignment, composed of convergence (facilitated by common focus, shared values, and leadership), coordination (helped by devices such as standards, information transmission, feedback, division of labour, and deadlines), and arbitration (facilitated by rules, policies, and conflict resolution techniques). The third infrastructure is imagination, composed of orientation (helped by visualisation tools, examples, explanations, codes, and organisational charts), reflection (supported by retreats, time-off, conversations, and pattern analysis), and exploration (facilitated by scenario building, prototypes, play, simulations, and experimentation). Here too economic geographers have a wealth of situated methodologies and stories to offer.

5 8 ASH AMIN AND NIGEL THRIFT It is not difficult to see that learning is a multiple, ongoing, distributed process that cannot be reduced to a set of formulae. Without a feel for the processes and practices that sustain learning, there can be no proper theory of the firm and therefore also no proper understanding of the sources of economic competitiveness. This axiom applies to the majority of topics claimed by formal economics, and it will simply not do to dismiss the insights as micro, empiricist, or not workable into a model or abstract theory. For one thing, this diminishes the definition of what constitutes theory; for another, it offers theory without process, experience, or actors. Conclusions None of the foregoing is meant to suggest that economists have no worthwhile knowledge about the world, or that their work cannot help geographers, or that geographers cannot contribute ably and well to economics. Our argument is different. It is that, at this point in time, we need to think seriously about whom we as economic geographers want to play out with. We think we would be fooling ourselves if we believe that we can lie down with the lion and become anything more than prey. Instead, we want to argue that our main friends should be in the new areas of economic study that are currently both flourishing and providing a genuine ground for the kind of contributions we can make. We might add that, ironically, policy makers and practitioners are also turning to evidence-based economic research and to social, cultural, and institutional understandings of the economy in order to stimulate innovation, entrepreneurship, and competitiveness at varying spatial scales. There is, of course, one more argument underlying all that we have written. Most economists and economic knowledge though certainly not all (e.g., Amartya Sen, an exception among Nobel economists) have been enlisted in the causes of the powerful, both in the sense that they provide much of the intellectual architecture through which certain aspects of the world are framed as inevitable and in the sense that they serve as some of its chief functionaries. What the new economic knowledges can provide is at least glimpses of some alternative worlds. It is these geographies that we too should be exploring. By standing on our own terms, out of the long shadow of economics, we may then draw young researchers back into economic geography, as they see the place of a different kind of economic theory in a postdisciplinary social science.

6 WHAT KIND OF ECONOMIC THEORY? 9 References Sinclair, T. (1999) Deficit discourse: the social construction of financial rectitude. In R. Germain (Ed.) Globalization and its Critics. New York: St Martin s Press, pp Thrift, N.J. (forthcoming) Pandora s box: the cultural turn in economic geography. In G.L. Clark, M. Gertler, and M. Kelley (Eds.) The Oxford Handbook of Economic Geography. Oxford: Oxford University Press. Wenger, E. (1998) Communities of Practice: Learning, Meaning, and Identity. Cambridge: Cambridge University Press. EDITORS NOTE: This intervention from Ash Amin and Nigel Thrift raises important questions about the goals and practices of economic geography, and we hope it will trigger a productive debate. If you want to respond either to the arguments here or to the wider question that Amin and Thrift raise in their title, please contact us with a short proposal. We will start to publish responses later on during the year. Jamie Peck and Jane Wills

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