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Discourse ethics for debt markets

Published online by Cambridge University Press:  05 January 2024

Timothy C. Johnson
Timothy C. Johnson*
Affiliation:
Heriot-Watt University, UK
*
Corresponding author: Timothy C. Johnson, Department of Actuarial Mathematics and Statistics, Heriot-Watt University, Edinburgh EH14 4AS, UK. Email: t.c.johnson@hw.ac.uk
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Abstract

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This article develops a pragmatic theory of finance in which markets are considered to be centres of communicative action in the face of uncertainty. This contrasts with the conventional approach that portrays markets as centres of strategic action in the face of scarcity. The argument follows Habermas and entails that a financial market must address the truthfulness, truth, and rightness of the statements made by its participants (i.e., the prices quoted). I claim that these discursive norms have been implicit in historical financial markets as expressed in the norms of sincerity, reciprocity, and charity. I conclude by proposing that ‘trust’ in commerce is a synthesis of the three discursive norms. The motivation of the article is to address the crisis of legitimacy that the financial system is experiencing, particularly in the United Kingdom (UK) and the United States (US).

Keywords

Communicative actionmarketsethicscredittrustfinancialisation
Type
Article
Information
Finance and Society , Volume 2 , Issue 1: Ethics of debt , 2016 , pp. 62 - 85
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Copyright
© 2016 The Author(s)

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