Monatsarchiv: Juli 2008

Saskia Sassen on knowlege and global cities

Understandingsociety has this rare video footage of Saskia Sassen, a sociologist at the London School of Economics (LSE) and Columbia University. In her essay “Embeddedness of global markets” (2005) in Knorr-Cetina/Brügger “The sociology of Financial Markets”, Sassen argues the topography of global electronic capital markets is embedded in a global cities interconnected through a global technological infrastructure. There is no fully virtualized market, firm or economic sector. Even finance, the most digitalized, dematerialized and globalized of all economic sectors has a topography that interconnects real and digital space and creates a backbone for global financial trading activities. Even though one might expect new information and communication technologies to eliminate the advantages of agglomeration in physical space, global electronic financial trade is dependent on a mix of resources and talents that is concentrated in a network of interconnected urban financial centers. Moreover, the global financial market, no matter how financialized and electronic, requires specific political regulatory conditions and thus depends on national states to produce an  institutional framework that reflects the global market for capital and the various fundamentals it is based upon. The formation of a global financial market is thus hard to imagine without a backbone in offline society and physical space.

In the videos below, we see Saskia Sassen give a lecture on cities as “urban knowledge capital” at the Urban Age India Conference in Mumbai /India in 2007, and her lecture be transferred straight to YouTube, Google and related platforms. Understandingsociety interprets the almost real time online availability of Sassen’s lecture as a

a dramatic illustration of the potential for diffusion and infusion of knowledge that the internet presents to the global world …

… and my guess is we will expect this type of knowledge transfer from social and physical space at an academic conference to the intenet and multiple mobile devices as a regular pattern of information diffusion, and the use of Social Media such as blogging, microblogging, bookmarking and tagging as common practice and universal standard procedures to interconnect invididual and collective bodies of knowledge. It will contribute to the visibility of scientists and their achievements and enable scientists to access academic and professional information on the day it gets published. Yet, I suspect German academia is not the driving force of this development.

Urban Age India: Saskia Sassen, Part 1

Urban Age India: Saskia Sassen, Part 2

Urban Age India: Saskia Sassen, Part 3

A beef on crude and rising food prices

While heads of government of the G8 plus 5 countries are meeting in Japan, I get a beef on rising prices of crude contributing to inflation and ever higher costs for mobility, energy and heating – Gas prices are beyond € 1,60 a liter [a gallon is almost 4 liters], and the prices for foodstuffs are up well beyond inflation. But annoying as I might find my way to the gas station and the grocery store, inflation in foodstuffs for the products relevant for poorest and most vulnerable people on the planet is quite a bit more dramatic. Yet German media seem to take little note of rising food prices on a global scale. They have released a few articles back in April, and recently, they seem to be more concerned with the Sommerloch (“summer hole”) than with the widespread and deepening economic crisis and potential long term consequences for economic development.

In a study as old as 1999, International Food Policy Research Institute (IFPRI, Washington D.C., USA) has projected an average rise of world population by 74 million people per year well beyond 2020, thus a continuous rise in need for basic foodstuffs worldwide. The research institute explains the current current food crisis with rising demand for food and feed, biofuels, high oil prices, climate change, and stagnant agricultural productivity growth.

At the end of June 2008, an internal World bank study leaked to the British Guardian, which was immediately taken up by Spiegel International. It presents a blow to the plant energy drive and fundamentally questions the Policy introduced by the European commission as to foster biofuels (see Nouvel Observateur). The World bank study holds that biofuels have forced up food prices up 75 Percent (more information over at Global Sociology).

IFPRI identifies a malfunctioning of world grain markets as an additional driver of the world food crisis. Given the thinness of major markets for cereals, the restrictions on grain exports imposed by dozens of countries have resulted in price increases. Several countries have adopted retail price controls, creating perverse incentives for producers. Speculative bubbles have built up, and the gap between cash and futures prices has risen. It stimulates overregulation in some countries and causes some commodity exchanges in Africa and Asia to halt grain futures trading. Some food aid donors have defaulted on food aid contracts. The World Food Programme (WFP) has even had a hard time getting quick access to grain for its humanitarian operations. Developing countries are urgently rebuilding their national stocks and re-examining the “merits” of self-sufficiency policies for food security despite high costs. (IFPRI, “Physical and Virtual Global Food Reserves to Protect the Poor and Prevent Market Failure” June 2008). A traditional approach to coping with the market failures would involve building up a physical, public, globally managed grain reserve. These reserves could be released to cope with excessive price increases. This reserve has the disadvantages of high storage costs and slow transactions. Instead, IFPRI suggests a different institutional arrangement for the exchange of commodities: (1) a minimum physical grain reserve for humanitarian assistance, and (2) a virtual reserve and intervention mechanism to calm markets in situations of increased speculative activity, backed up by a financial fund.

Hopefully, the G8 will consider IFPRI director Joachim von Braun (video below) and the various other warning voices and resolve this man-made crisis and the European Union will take responsibility for its failed environmental policy. Cereals are needed to feed the poorest and most vulnerable people on the planet, they do not belong in the tank of your car.

Joachim von Braun – U.S- Senate Testimony

Oh happy day

After six short trips to Franconia, I am in a summer break mood sitting in a nice Wifi café in Bamberg (Cafe “New York”, Austraße) , enjoying the sunshine and waiting to attend a meeting of our alumni organization ABS at the university of Bamberg. I have finished my 3 courses on economic and organizational sociology at the universities of Bamberg and Würzburg, and the participants still have quite a bit of work ahead unless their text materials are ready to be turned in. We have discussed quite a bit of literature including passages of Jens Becker’ts “Beyond Markets”, Neil Fligstein’s “Architecture of markets”, Kieran Healy’s “Blood and organs”, Mike Powers “Organized Uncertainty”, Guido Möllering’s “Trust: Reason, Routine, Reflexivity” in economic sociology, and we have discussed about the complicated relationship between organizations and professionalism in the course of organizational sociology. A conclusion on the results of the three courses at the two schools could be drawn only after the grading procedure late fall, but the discussions have been constructive and fruitful. Meanwhile – have a nice summer, everybody!