By Dr Clare Williams, Lecturer, University of Kent

In this post, I explore the ways in which our framing tacitly shapes the way we perceive and respond to events through a deep dive into one metaphor: embeddedness. I suggest that if we truly want imaginative ways of responding to the financial crashes, social crises, and environmental catastrophes currently facing society, we might consider alternative ways of doing, talking, and thinking about legal and economic phenomena.

The way we talk matters. The words we use, and the metaphors we invoke combine to shape our frames of reference; how we comprehend the world, as well as how we respond to it. This applies equally to small-talk as to the weightier things in life. However, our framing at the interface of legal, economic, and social phenomena is frequently overlooked. This, in turn, can lead to the reproduction and re-entrenchment of dominant frames that, for the most part, fly largely under the radar.

Let me give you an example. In the wake of the 2008 financial crash, it became fashionable to claim that the economy had become “disembedded” from society. By this, commentators seemingly meant that markets had lost sight of their social function and origins and had fallen out of alignment with overarching social goals. At the same time, others claimed the inverse; that society had become embedded in the economy. The solution, seductive in its simplicity, was to “re-embed” the economy in society, implying a re-integration of the two spheres to re-align economic and societal objectives. Embeddedness as a metaphor began to pop up everywhere, describing the relationship between law, economy, and society, though frequently without definition.

But what does it mean to “re-embed” the economy?

In my book “An Economic Sociology of Law Reimagined: Beyond Embeddedness”, I take a deep dive into this particular metaphor, showing that embeddedness as a tertiary level, ontological metaphor is conceptually flawed on two counts. But, more problematically, our ongoing conceptual commitment to embeddedness in describing the economy and its regulation perpetuates dominant economic and legal rationalities – those very ways of thinking that led us into the financial crisis in the first place.

How can an economic sociology of law lens offer insights?

In presuming, a priori, a conceptual differentiation between the three spheres, embeddedness as a metaphor perpetuates the metaphorical fiction of ontologically separate law, economy, and society. We might think that the financial crash would have prompted some radical reimagining of how we do, talk, and think about law, economy, and society, and a constructivist lens such as those proposed by ESL scholars hints at such approaches. These might include thinking of legal and economic phenomena as two sides of the same, social coin, and an ESL lens can offer us alternative analytical and normative conceptualizations of law and economy that enable a challenge to dominant narratives: doctrinal and neoclassical, respectively.

Conveniently though, an ESL lens can offer us further insights here too, as embeddedness is the “core concept”, or “common denominator” of an economic sociology of law, as well as its more established sister project, economic sociology. Looking back to the works of Karl Polanyi, and then through the New Economic Sociology of Mark Granovetter, we can trace the genealogy of embeddedness at both macro and micro-levels, identifying its core characteristics along with potential limitations.[1]

In seeking to re-sociologize legal and economic phenomena through closer dialogue between the spheres, we can suggest that an ESL lens proposes a quasi-constructivist approach. However, if this is the case, the core concept of embeddedness becomes a problematic conceptual hurdle that pulls in the opposite direction, analytically separating out law, economy, and society into their three recognizable disciplinary silos once again, and scotching any constructivist ambitions of ESL in the process. Nevertheless, an ESL lens offers a microcosmic point of study for understanding wider narratives and their ongoing construction of hegemonic analytical concepts.

In practice, this means that…?

Voices responding to the financial crash noted that dominant market rationalities prioritized values that often did not align with those of wider society. Indeed, interests such as justice, fairness, and equality are frequently difficult to shoehorn into the strict economic rationalities that inform mainstream narratives such as efficiency, productivity, and utility maximization. More urgently, these are the core but frequently invisible conceptual structures currently being baked into algorithms and the foundation models that underpin them. AI tools such as ChatGPT that use natural language processing (NLP) to communicate fluently with humans have been called out on racial and gendered biases in the language they use, but the underlying analytical and normative structures within the data on which they are trained remains largely uncontested.

This book is about one metaphor, but there are many others, and while the example here has been the financial crash of 2008, more recent events such as the social crises highlighted by Covid-19 and the impending climate catastrophe eclipse the financial crash. Regardless,

How can an economic sociology of law lens offer insights?

In presuming, a priori, a conceptual differentiation between the three spheres, embeddedness as a metaphor perpetuates the metaphorical fiction of ontologically separate law, economy, and society. We might think that the financial crash would have prompted some radical reimagining of how we do, talk, and think about law, economy, and society, and a constructivist lens such as those proposed by ESL scholars hints at such approaches. These might include thinking of legal and economic phenomena as two sides of the same, social coin, and an ESL lens can offer us alternative analytical and normative conceptualizations of law and economy that enable a challenge to dominant narratives: doctrinal and neoclassical, respectively.

Conveniently though, an ESL lens can offer us further insights here too, as embeddedness is the “core concept”, or “common denominator” of an economic sociology of law, as well as its more established sister project, economic sociology. Looking back to the works of Karl Polanyi, and then through the New Economic Sociology of Mark Granovetter, we can trace the genealogy of embeddedness at both macro and micro-levels, identifying its core characteristics along with potential limitations.[1]

In seeking to re-sociologize legal and economic phenomena through closer dialogue between the spheres, we can suggest that an ESL lens proposes a quasi-constructivist approach. However, if this is the case, the core concept of embeddedness becomes a problematic conceptual hurdle that pulls in the opposite direction, analytically separating out law, economy, and society into their three recognizable disciplinary silos once again, and scotching any constructivist ambitions of ESL in the process. Nevertheless, an ESL lens offers a microcosmic point of study for understanding wider narratives and their ongoing construction of hegemonic analytical concepts.

In practice, this means that…?

Voices responding to the financial crash noted that dominant market rationalities prioritized values that often did not align with those of wider society. Indeed, interests such as justice, fairness, and equality are frequently difficult to shoehorn into the strict economic rationalities that inform mainstream narratives such as efficiency, productivity, and utility maximization. More urgently, these are the core but frequently invisible conceptual structures currently being baked into algorithms and the foundation models that underpin them. AI tools such as ChatGPT that use natural language processing (NLP) to communicate fluently with humans have been called out on racial and gendered biases in the language they use, but the underlying analytical and normative structures within the data on which they are trained remains largely uncontested.

This book is about one metaphor, but there are many others, and while the example here has been the financial crash of 2008, more recent events such as the social crises highlighted by Covid-19 and the impending climate catastrophe eclipse the financial crash. Regardless, the salient points remain the same. In order to respond to crashes, crises, and catastrophes, we need imaginative ways of rebalancing the voices and values that hegemonic narratives prioritise, and to do that, we need ways of talking about (econo-)socio-legal phenomena that enable innovative ways of thinking and doing. In short, the way we talk matters.

“An Economic Sociology of Law Reimagined: Beyond Embeddedness” is out now by Routledge, with Open Access content. Please see https://www.routledge.com/An-Economic-Sociology-of-Law-Reimagined-Beyond-Embeddedness/Williams/p/book/9780367761448

[1] In my book, I extend this analysis through the applications of embeddedness by John Ruggie (embedded liberalism) and Peter Evans (embedded autonomy). These offer a set of guidelines for how we might deploy embeddedness more successfully, although these do not overcome the more fundamental limitation of the metaphor’s incompatibility with constructivist readings of economic and legal phenomena.