Performativity. 

This is the idea that economic theory informs policy-making which in turn shapes the economic environment through legislation that incentivises the dehumanised, self-interest behaviour that the theory envisages.  So theories move beyond informing us to shaping us.  That means how we describe the economy matters, because we risk creating it. 

In one way, performativity is already here.  Capitalism has already created the amoral profit-seekers of market theory, and they all but walk among us.  In law, a firm is treated like a person in key respects, and managers have a duty to maximise profits for shareholders.  Capitalism’s key institution divorces management from ownership, and moral responsibility is gravely compromised as a result.    

 

Does theorising capitalism using ‘demand’, so failing to distinguish between wants and needs, create a world of affluence and squalor?