Academic journal article Journal of International and Global Studies

The Sinkholes of Global Finance: Racialization and Cosmopolitanism among Financial Elites in Malaysia

Academic journal article Journal of International and Global Studies

The Sinkholes of Global Finance: Racialization and Cosmopolitanism among Financial Elites in Malaysia

Article excerpt

Introduction

Arbitrage as the core practice in finance today serves, figuratively and literally, to bring into alignment disparate formations. Sociologist Ronald Burt argues that brokering across the structural holes between networks that do not overlap may provide a "viewing advantage that can translate into social capital" if brokering across structural holes within an organization leads to better performance and/or innovative ideas (Burt, 2004, p. 351). While Burt's analysis refers to networks within electronics conglomerates in the U.S., I argue that the idea of brokering across structural holes--by identifying and arbitraging differences in regulatory or racial formation for example--may be fruitfully applied to the networking sociality of financial fund managers. While social scientists have examined network formation in relation social capital (Hall, 2011), transnational class formations (Carroll, 2009; Sklair, 2001), and competitive advantage (Wade, 1990), these analyses have focused on networking within and between core countries. Here, I focus on how fund managers in an emerging market in Asia seek to emphasize their cosmopolitan networks in order to convince their peers in the core countries of Europe and the U.S. that Asian fund managers are worthy market players.

While financial expansions on a global scale are always marked by differentiation via the racial marking of subject populations, the current neoliberal turn reveals an intensification of the process of differentiation through a reformatting of exchange that is being "tested out" in emerging markets. Just as "the colonies" were always formative in the development of economies and elite networks in the metropole, in the current round of globalization, post-colonial elites are raised and participate in the framing of the liberalization of the economy as the main object of politics (Mitchell, 2009). In this context, I argue that it is productive to view racial formation--a process wherein racial categories are created and transformed as a constitutive part of the political economy of a nation-state--in global terms (Omi & Winant, 1994, p. 55-56). By doing so, this analysis illuminates how financial experts, in arbitraging between the U.S. and European racial formations and other racial formations, seek to realize the value of their social and cultural capital in the economic field. The construction of a racial formation rests on a series of projects in which people and social structures are represented and organized. Caitlin Zaloom, for example, in the context of London futures markets, analyzed a move on the part of a futures trading conglomerate to replicate an "American-style multiculturalist paradigm" by hiring previously unrepresented racial "others" on the assumption that their differences would mean different interpretive perspectives, enabling them to broker between "structural holes," which would ultimately, they hoped, generate more profits for the company (Zaloom, 2006, p. 91-92). In the assumption that these "others" would generate profits simply as a result of their "differentness" and their different perspectives, a gap is revealed between the firms' stated aims of training "homo economicus" across the board and the reality of the ways in which authentic diversification of the workplace works. The firm made the mistake of assuming that each racialized "other" would bear an "otherness" that could be commodified.

As core states have a disproportionate influence on the overall financial architecture through which representation and institutional organization are pursued, the elites within those states are exceptionally privileged. We find them reproducing their exclusionary social relationships through processes of capital mobility and the commercialization of sovereignty (Palan, 2003). As William Tabb argues, the concept of "concentric club formation" recognizes the "density of business sector networks in the powerful states," such as, above all the U. …

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