Volume 7(2): 137–162

Copyright © 2007
SAGE
www.sagepublications.com
DOI: 10.1177/1470593107076862

articles

On the nature of markets and their

practices
Hans Kjellberg
Stockholm School of Economics, Sweden

Claes-Fredrik Helgesson
Stockholm Center for Organizational Research and Stockholm School of
Economics, Sweden

Abstract. This article presents a conceptual model of markets as constituted

by practice. Drawing on recent sociological research on the performativity of
market theories, the article stresses the need to take seriously the role of ideas in the
making of markets. Since extant studies of performativity focus on the role of
economics in shaping markets, it is argued that marketing as an academic discipline
is a particu- larly apt partner in expanding this endeavour. The conceptual model
presents markets as the ongoing results of three interlinked types of practices:
normalizing practices serving to establish normative objectives; representational
practices serving to depict markets and/or how they work; and exchange practices
serving to realize individual economic exchanges. The links between these practices,
which are conceived as trans- lations, are elaborated upon using a number of
empirical studies. Finally, the model is used to illustrate differences in how markets
are being continuously realized. This highlights the lack of studies on performativity
in markets constituted by configura- tions of market practices in which marketing

tices marketing
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Performativity and the similarity between markets and landscape gardens

There is a large and varied supply of theories providing understandings of
markets as a phenomenon. Their presence is not only restricted to academic
research or
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textbooks. Market theories are present in many everyday market practices, be it

in the shape of rules stipulated as part of a governmental market reform or the
use of some measurement device when performing customer segmentation.
Despite the proliferation of both empirical markets and theories about them, all
is not well.
The subject of the relationship between marketing science and practice has a
long history within marketing (Cornelissen and Lock, 2005). However, it is only
recently that analytical efforts have been made to take seriously the interaction
between theoretical understandings of markets and market practices. One of the
more interesting developments in this area concerns the performativity of
market theories, or how ideas about markets (but also marketing tools) take part in
shaping markets (Callon, 1998a). This research program acknowledges the possi-
bility that market theories broadly defined contribute to shape markets and goes
on to investigate the character of this influence. To date, however, the bulk of this
work, both conceptually and empirically, has been made outside the marketing
discipline, primarily engaging researchers from economic sociology and sociology
of science and techniques (Barry and Slater, 2002; Callon, 1998b; Callon and
Muniesa, 2005; Callon et al., 2002; MacKenzie, 2003; MacKenzie and Millo,
2003). This article seeks to contribute to the more reflective approach towards
market practice that is being developed within this emerging field of market
studies. Our specific argument is that marketing as an academic discipline is a
particularly apt partner in this endeavour.
Before sketching our approach for studying markets, it is useful to ask why the
issue of how ideas partake in shaping markets has been so neglected. The root
cause of this, we contend, is the strong association found in theoretical as well as
popular discourse between markets and natural phenomena. Classic metaphors
such as Smith’s (1981 [1776]) invisible hand or Mandeville’s (1970 [1705])
bees have served to de-emphasize the import of agents seeking to shape markets.
The abstract conception of markets as price forming mechanisms promoted by the
marginal revolution further pronounced this tendency (cf. Marshall, 1920 [1890],
Book V, Ch. 1). The association of markets with a deep, essential isomorphism in
the face of considerable diversity in market phenomena implied that successful
research and theorizing about markets was about uncovering their given charac-
teristics.
To position our perspective, it is useful to elaborate on the association
between markets and nature through a brief digression to the world of
horticultural planning. To us, the market as a phenomenon is more similar to
the English style landscape garden than to the nature that these gardens sought
to reproduce. For Nature was the explicit ideal when the English landscape garden
came into fashion in the late 18th century. Yet, when it came down to
practicalities, any kind of nature would not do. It was a very specific kind of
nature that provided the prototype for these gardens, namely, nature as
portrayed in renaissance landscape paintings. Such paintings, or re-
presentations of nature, were considered more worthy of reproduction in the
shape of landscape gardens than nature itself (see, for instance, Warnke, 1995:
80).
We argue that there is a striking similarity between the ideas behind the English

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Hans Kjellberg and Claes-Fredrik Helgesson

landscape garden and the view of markets that emerged during the same period
from the writings of Adam Smith and other classical economists (for an overview,
see Gill, 1967).1 Like gardens, markets are constructed, shaped by concrete
activi- ties. However, these efforts are regularly concealed by the natural
appearance of their outcome, which is portrayed as unshaped and un-
constructed. The parallel to English landscape gardens also illustrates that such
construction work is highly dependent on ideas. Not only do ideas influence
what gardeners as well as marketers do, they also influence the norms used to
evaluate their work, irrespec- tive of whether it concerns gardens or markets.
Lastly, the rise of the landscape garden nicely illustrates the import of re-
presentations, underscoring that the ways in which we re-present the world
also depend on ideas. Indeed, we shall argue that the production of re-
presentations is an important part of what makes markets market-like.
The purpose of the article is to devise an alternative conceptual vocabulary
for studying markets allowing us to take seriously the role of ideas in the
making of markets. The route we choose is to focus on the practices that
constitute markets. That is, the practices that make markets real, and in some
cases, like nature. The article draws on a collective effort to study market
practices (Helgesson et al., 2004). Still, what is reported here is merely the end of
the beginning of work in this area. Throughout this article we will therefore seek
to identify future research issues that could further contribute to an increased
understanding of the processes that shape markets. Many of these issues
specifically concern the role of marketing theories in shaping markets.
The article is structured as follows: First, we present the ontological and
methodological underpinnings of our approach and introduce the concept of
market practice. Second, we present a threefold conceptualization of market
practice and introduce the concept of translation as a way of addressing the
issue of how such practices are interlinked. Third, we systematically explore how
trans- lations link the three types of market practices in the ongoing production
of empirical markets, drawing on empirical observations from a number of
such markets. We also identify issues that need to be further investigated
concerning the links between different practices. Fourth, we use our
conceptualization of markets as constituted by market practices to discuss
differences in how markets are being realized. Finally, we conclude the article
with a brief discussion on interesting routes for further empirical research.

Starting points for studying market practice

Over the past two decades, there has been a growing interest in practice within the
social sciences at large (Orlikowski, 2000; Schatzki et al., 2001). Several approach-
es have emphasized the import of studying practice, for example work on science
in action (Latour, 1987), Technologies-in-Practice (Orlikowski, 2000), and
commu- nities of practice (Brown and Duguid, 1991, 2001; Wenger, 1998).
Within marketing as an academic discipline there has always been a fairly close

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relation to the practices of marketers (Cornelissen and Lock, 2005). Classic studies
such as Shaw’s (1912) inquiry into the methods and agencies involved in selling
and goods distribution and Cox and Goodman’s (1956) detailed study of the
marketing and distribution of housebuilding materials explicitly sought to identify
and improve on the practices of businessmen. The issue of practical relevance – ‘a
quality widely attributed to research that closes the gap between theory and
practice’ – continues to be vital both for attracting funding and for evaluating the
quality of research in marketing (Brownlie and Saren, 1997: 147). Besides the
strong normative tradition, researchers with a network approach to industrial
marketing have repeatedly argued for the need to study the practical workings of
markets to improve our characterizations of them (see for example Axelsson and
Easton, 1992; Håkansson, 1982).
Although the term marketing practice is frequently used as a catch-all for that
which is not marketing theory (see for example Brodie et al., 1997; Coviello et al.,
1997; Rossi et al., 1996), the recent wider academic interest in practice has made
few inroads into marketing discourse. A notable exception is the attention given to
consumption practices within consumer marketing (Belk, 1988; Holt, 1995).
Despite their relevance, these efforts have hitherto tended to exclude practices
related to the actual exchange of goods and services (but see Pinch and Clark,
1995; Prus, 1989a, 1989b; Sherry, 1990). We find this lack of systematic inquiry
into market practice unfortunate.

Why study market practice?

By attending to market practice we can move away from polarized discussions
concerning whether this or that theory provides an unrealistic characterization of
markets, for example in academic discussions, or whether this or that market is a
‘real’ market or not, for example in regulatory settings (cf. Brownlie and Saren,
1997: 156). A well-conceived approach to market practice may be used to address
two important issues (cf. Czarniawska, 2003). First, it may offer a richer charac-
terization of what it is that is being shaped through market practice; i.e. what
possible shapes may economic exchanges and markets assume? Second, it may
provide us with a better understanding of the processes that lead to these out-
comes; i.e. how is a certain market being shaped? It is our ambition to contribute
to such a more reflective approach towards markets.

Ontological and methodological underpinnings of our perspective on market practice

Our interest in market practice has ontological as well as methodological
under- pinnings (for a more detailed discussion, see Kjellberg and Helgesson,
2006). Our position is heavily indebted to work within the sociology of science
and techniques and in particular to the sociology of translation (Callon, 1986;
Callon and Latour, 1981; Latour, 1986, 1987; Law, 1986). Ontologically, we
stress the emergent and plastic character of reality. Properties of the world are
neither natural facts nor social constructions imposed on shapeless matter. They
are instead outcomes of a

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continuous recursive process involving materially heterogeneous entities (Law,

1994); ‘produced and stabilized in interaction that is simultaneously material and
social’ (Law and Urry, 2004: 395). A methodological consequence of this is that
we, as inquirers, ‘do not in advance, and in place of the actors, define what sorts
of building blocks the social world is made of’ (Latour, 2005: 41). Thus, rather
than assuming what the essence of reality is, we treat the wide variety of ways in
which reality concurrently is being constructed as a topic for empirical inquiry. 2
To capture this basic ontological stance, we need to redefine our object of
inquiry. Most definitions of markets are based on the assumption that it is possi-
ble, in principle, to discover and describe the properties that are typical of markets.
As a consequence of this, attention is directed towards the practical difficulties
associated with detecting such properties. In contrast, we assume that it is
impossible in principle to define the list of properties that is typical of markets,
and instead direct attention to how actors are able to do so in practice (cf.
Czarniawska, 1993: 8–11; Latour, 1986).3 This redefinition has several method-
ological consequences. Most importantly, it suggests that we need to study
markets in the making, since this is where the practical definition repeatedly takes
place (cf. Latour, 1987). This will allow us to distinguish between two contra-
dictory explanations typically offered to an observed facet of reality, for example
to the emergence of a market: one put forward in retrospect as a way of accounting
for/making sense of an outcome, and the other exhibited through the activities
that went into its making. 4 Our emphasis on practice should thus be seen as an
attempt to direct attention to the verbs (the process) rather than the nouns (the
outcome) when studying economic organizing (cf. Law, 1994).

The market practice concept

Given these starting points, our use of the term practice refers most closely to its
meaning ‘action or execution as opposed to theory’ (The Concise Oxford Diction-
ary, 1990). We make no assumptions concerning how common or established a
given practice is, nor concerning the extent to which it is habitually performed.
That is, we are not referring exclusively to praxis.5 Our redefinition of markets
further suggests that we should not make theoretically informed a priori exclu-
sions of certain classes of activities (Bloor, 1976; Callon, 1986; Law, 1994).
Consequently, we define market practice broadly as all activities that contribute
to constitute markets.
Such a definition is obviously difficult to defend in principle. However, in
line with our ontological starting points, we contend that actors involved in the
practical shaping of markets usually are able to identify the relevant activities
(cf. Czarniawska, 1993; Latour, 1986). Hence, our admittedly broad definition
of market practice should be seen in the light of a research strategy
emphasizing the importance of studying markets in the making, rather than
markets as ready- made.
The definition also begs the question whether there is a difference between
practices that contribute to shape markets and practices that are undertaken in a

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market? Although convenient, a distinction in principle between market-making

practices – defined as activities that shape the overall market structure – and
marketing practices – defined as activities that contribute to develop an actor’s
position within that structure – is seriously misleading. Here, we draw on
Alderson and Cox’s central insight concerning market dynamics:
[A]n organized behaviour system is not a neutral framework or container for the actions and
evaluations that take place within it. That is to say that a market changes day by day through
the very fact that goods are bought and sold. While evaluation is taking place within a
marketing structure, the structure itself is being rendered weaker or stronger and the changes
in organiza- tion which follow will have an impact on tomorrow’s evaluations. Marketing
theory will not provide an adequate approach if it ignores this interaction between the system
and the processes which take place within it. (Alderson and Cox, 1948: 151)
This view suggests that market practice is all there is, which both shapes and
markets. Consequently, our definition of market practice should be taken to
include efforts to shape markets as well as efforts to market in markets (to
promote, advertise, sell, etc.). Having said this, we do of course recognize that
there may be substantial differences in terms of the practical effects of
individual activities.

Modelling market practice

Based on the broad definition of market practice suggested above, we have worked
abductively to form a conceptual model that can account for the practical
shaping of markets. That is, we have combined previous theoretical insights
with observa- tions of markets in the making to devise a model that, if it were true,
would explain the practical shaping of markets (Frankfurt, 1958; Mick, 1986).6
As a result of this process, we propose a threefold conceptualization of market
practice as exchange practices, representational practices, and normalizing
practices.
Exchange practices gathers what might seem to be the most straightforward of
market practices; it refers to the concrete activities related to the consummation of
individual economic exchanges (cf. Alderson and Cox, 1948). This includes all the
idiosyncratic activities related to a specific economic exchange, such as specifying
and presenting products, negotiating prices and terms of delivery, to mention just
a few (see Håkansson, 1982; Prus, 1989a, 1989b; Sherry, 1990). In addition to
these, a number of more general activities also contribute to shape individual
exchanges, for example advertising, organizing the distribution of goods, com-
parative product testing, etc. These activities all contribute to temporarily stabilize
certain conditions (the parties to the exchange, exchange object, price, terms of
exchange) so that an economic exchange becomes possible.
Exchange practice corresponds to the mundane activities directly geared
towards cultivating a garden. Many of these are performed by gardeners, but as
anyone with a garden of their own knows, many others who may have dramatic-
ally different objectives contribute, by invitation or not, such as noxious animals
and insects. Further, just as material devices like wheelbarrows, fertilizers, and

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pruning shears play an important part in gardening activities, exchange practice

is full of these devices: supermarket shelves, order forms, stock tickers, etc.
Representational practices include activities that contribute to depict markets
and/or how they work. Markets are abstract entities and in order to speak of
the market for a certain type of good, it is necessary to bridge temporal and spatial
distances between individual exchanges and produce images of this market.
Representational practices are therefore as fundamental in shaping markets, as are
exchange practices.7 Anand and Peterson (2000) have highlighted this import of
market re-presentations or ‘market information regimes’ for constituting markets.
Recognizing the role of activities that produce market re-presentations also
provides us with a way of addressing the issue of performativity. The making of
re-presentations, as science studies so convincingly have showed, contributes to
shape the phenomena they re-present (Latour, 1986; Osborne and Rose, 1999). In
some cases, such re-presentations are put to use in shaping individual exchanges,
for example when a firm collects and processes sales statistics to assess current
promotion practices. In other cases, re-presentations of markets are used to estab-
lish preferable directions for some (group of) actor(s), for example as part of a
firm’s efforts to formulate a market strategy.
This brings us to normalizing practices. This category was devised to account
for activities that contribute to establish guidelines for how a market should be
(re)shaped or work according to some (group of) actor(s). That is, it refers to
the establishment of normative objectives (Brunsson and Olsen, 1997;
Czarniawska- Joerges, 1988). It reflects the observation that many attempts are
made to affect markets in specific directions. The fact that markets do not
readily take on pre- cisely the shape or form intended, neither means that such
attempts are not made nor that the objectives are unimportant (cf. Bauman,
1992; Czarniawska, 2003).
In terms of specific activities, the category includes efforts involved in the
numerous market reforms observed during the past two decades (see for
example Brunsson and Olsen, 1997; Forssell and Jansson, 2000). It also
includes efforts to specify general rules of competition and marketing and the
application of such rules to specific cases. A third important type of effort is
the shaping of voluntary standards, both private and official, which may
substantially affect markets (Brunsson and Jacobsson, 2000). Finally, the
category includes activities related to strategic planning and establishment of
objectives by individual market actors (on the importance of models from
business administration and economics for this process, see Cochoy, 1998;
Miller, 1998).
We suggest that this threefold conceptualization of market practices is
instruc- tive when attempting to address issues concerning the practical
realization of markets. It may, we argue, allow us to devise empirical studies
on the shaping of markets. Concrete activities undertaken by various actors
intersect and affect both the individual economic exchanges that take place, the
images of markets that are produced and the objectives that actors establish for
themselves and others.
It is important to emphasize that the three types of market practice are not
based on any ascription of essential, inherent qualities to specific activities.
Depending on the context within which an activity is performed, it may well
con-

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tribute either to establish normative objectives, consummate economic

exchanges or generate re-presentations. In addition, the performance of the
three types of practices is most likely to be entangled, raising questions
about their utility as descriptive categories. However, the conceptualization is
not intended as a descriptively accurate model of ready-made markets, but as a
workable tool for addressing issues related to their practical shaping.
For this purpose, distinguishing between different types of market practices is in
itself only moderately illustrative of what constitutes markets. The important
point, which requires considerable elaboration, is how these market practices
are interlinked. To return to the metaphor of the English landscape garden: we
need to address how landscape paintings were transformed into garden designs,
and then into rolling hills, sparkling ponds and beautiful shady groves; but also
how gardening over time may contribute to modify both current norms and re-
presentations of gardens. For this general phenomenon of how something is
reproduced in another form, or transformed into something else, we propose to
use the concept of translation as conceived of within sociology of science
(Callon, 1986).

Practices linked through translations

By translation we denote the basic social process through which something – an
idea, a rule, a text, a product, a technology, a claim – spreads across time and
space (Latour, 1986). If no one is there to pick it up, nothing happens. This applies
equally to the first, the second and the last in the row. Those who do pick it up
make an essential contribution to its existence and survival. Such transportations
regularly transform that which is being moved. Rather than depicting causalities,
these translations generate traceable associations between practices (cf. Latour,
2005: 108). If an idea or object remains the same despite being spread, this
requires a special explanation.
Let us illustrate with a well-known marketing procedure, namely market
segmentation (see for example Haley, 1968; Smith, 1956). The procedure involves
a number of steps including: 1) designing a study based on the firm’s objectives;
2) selecting respondents through some sampling procedure; 3) surveying the
resulting sample with instruments like questionnaires; 4) analysing the
collected data using some technique for multivariate data-analysis; and 5)
developing profiles for each of the identified clusters (see Figure 1). This
procedure produces a set of market segments that subsequently can be targeted by
the firm. Each single step in the procedure involves one or more translations. In
the end, the market segments identified on a piece of paper come to replace all
the customers in that market and express what characterizes them.
Rather than regarding segmentation as an epistemological procedure that
unveils segments already there, however, our use of the term translation posits that
segmentation is an ontological procedure – an attempt to produce segments (cf.
Osborne and Rose, 1999). Furthermore, the activities, tools, instruments and
other elements involved in this process are as much part of the resulting segments

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Figure 1
A simplified rendering of a chain of translation producing customer segments (based on
Kotler, Armstrong et al., 2002: 339)

as are the customers that they come to re-present. That is, the resulting segments
are co-produced by a large number of heterogeneous entities. The example also
illustrates how a chain of translations may allow one setting, in this case often a
marketing department, to assume (or be given) the right to speak on behalf of
others, in this case a number of customer groups (cf. Callon, 1986; Latour, 1998).
Above we emphasized the entangled character of the three categories of market
practices. The general concept of translation provides a conceptual tool for
addressing in detail just how market practices might be entangled. If individual
activities are linked through chains of translations, the three types of market
practices are at best relatively more dense areas of activity, rather than distinct
classes of practices. The important issue, then, is how various instances of market
practice are linked to one another through chains of translation, an issue we
further elaborate in the next section.

Organizing markets or how gardens become

Based on our threefold conceptualization of market practices and the concept
of translation as the basic process through which such practices are linked, we
are now ready to address in more detail how market practices constitute
markets. We do this by elaborating on how processes of translation might link the
three types of practices to each other, the rationale for this being that such links are
central in the process through which various practices constitute markets.
All in all, we look at six types of links (see Figure 2). We start by elaborating on
how normalizing and representational practices may influence exchange
practice. Second, we discuss how exchange and representational practices may
affect normalizing efforts. Finally, we look at how exchange and normalizing
practices can affect representational practice. To illustrate the links we draw on a
number of empirical studies of market practice (Helgesson et al., 2004).

How do norms and re-presentations affect exchange practices?

Perhaps the most obvious instances of how normalizing efforts affect exchange
practice can be found in the numerous market reforms undertaken over the past
decades, for example under the label of New Public Management (Forssell and

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Figure 2
Constituting markets: possible links forged through translations between exchange,
representational and normalizing market practices

Jansson, 2000). In a case study of a municipal procurement of geriatric care,

Forssell and Norén (2004) show how requirements stipulated as part of the
Swedish Public Procurement Act (PPA) were translated into tools partaking in
subsequent exchange practices. The PPA purports to foster efficiency and
compe- tition by stipulating procedures that ensure that public agencies procure
goods and services in a businesslike manner. It requires, for instance, that the
criteria for evaluating and choosing among offers should be explicitly stated in
the call for tenders. The PPA itself is modelled on a view on economic rationality
and sources of efficiency that clearly stems from micro-economic theory.
In their study, Forssell and Norén show in great detail how the paragraphs of the
PPA took part in the procurement procedure. Specifically, they were translated
into both the call for tenders and the tool used to evaluate the offers. At the
same time, they also show that these translations carried with them some
degree of dis- cretion. For instance, when stipulating the specific evaluation
criteria to be used, the administrators decided to rely on some parts of the
healthcare legislation while choosing to disregard others.
There are two fundamental points worth stressing here. First, norms about
economic agency contained in legislation are brought to bear on specific exchange
situations through translations into rules and tools. Second, although
influential, neither these norms, nor the rules that they are translated into,
remain unaltered when applied to specific exchange situations. In sum, then,
the economic agency

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Hans Kjellberg and Claes-Fredrik Helgesson

performed by the purchasing municipality was a negotiated and precarious

outcome of translations. (This is one reason why the notion of translation is so
powerful in the study of how different market practices are interlinked in the
constitution of markets.)
Although efforts to adapt to legal rules provide succinct examples of how norms
are translated into tools that are put to use in specific exchange settings, it
would be too limiting to view this translation process as restricted to cases of
market regulation and public reform. The growing number of voluntary
standards for products and production processes such as fair trade and eco-
labelling is one important example of such influence (see, for instance Boström,
2003; Boström et al., 2005). Another set of cases, which remains largely un-
researched, is how marketing theories affect the exchange practices of firms. One
theme to investigate in this respect would be how theoretically-based normative
advice, for example concerning key account management, is translated into
tools that in effect con- tribute to shape specific market agencies (Spencer,
2005). Here research within marketing has an interesting and reflexively
challenging task.
A second chain of translations affecting exchange is that which links representa-
tional practices to exchange practices. Much like how the architects of English
landscape gardens modelled their gardens on renaissance paintings, actors
engag- ing in exchange thrive on re-presentations of what the market and its
actors are. In a study of how stockmarket analysts use valuation models,
Hägglund (2004) has highlighted the import of how these re-presentations are
conceived to motivate trading. He observes that the models favoured by the
analysts are not those deemed most scientifically robust by academic research
in financial economics. The reason for this, he stresses, is to be found in the
role that the resulting re- presentations play in shaping the stock trade. In
particular, he emphasizes that the re-presentations partake in and produce
effects on exchange practice primarily in their capacity as topics for
conversation.
Financial markets, with their incessant production of statistics, may be an
especially illustrative setting when it comes to the import of re-presentations in
shaping exchange practice. On closer inspection, however, we would argue that
it is difficult to find any market where re-presentations of actors and exchanges
do not partake in exchange practice. At the very least, we would expect some form
of feedback through which actors engaging in exchange take the results of
previous exchanges into account, and in so doing, alter their subsequent exchange
practices. The organization of such feedback loops may of course vary
considerably. Depending on the market, they may be contained largely within a
single market actor, whether an individual or an organization, or distributed
across a large number of specialized actors. Such feedback loops is an
interesting topic for research in marketing that to our knowledge remains
unexplored.

How do exchanges and re-presentations influence normalizing practices?

Efforts to establish norms depend on images of the situations that the norms
are intended to regulate. Re-presentations of markets and their actors
therefore

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constitute an important input to normalizing practices. In a historical study of

the relation between the natural monopoly concept and US
telecommunications, Helgesson (2004; see also Helgesson, 1999) provides one
example of how images of an industry might be important for shaping
normalizing practices. He shows how the re-presentation of the telephone
system based on the theory of natural monopolies produced images of an
industry with specific characteristics, high- lighting its cost structure and the
negative implications of having competition in the market for telephone
services. These images were in turn important inputs into the regulation of the
industry and its long time exemption from the Sherman anti-trust legislation.
In a study of the post-war efforts to reorganize Swedish food distribution,
Kjellberg (2004; see also Kjellberg, 2001) shows how images of distribution ineffi-
ciencies spurred governmental initiatives for reform. Moreover, the study
shows how re-presentations of the relationship between retailers’ purchasing
behaviour and overall distribution costs triggered initiatives by a large wholesaler
to establish new rules governing how retailers were to order goods. In both
instances, thus, the results of representational practices were mobilized in
normalizing practices.
Normalizing practices may also be affected more directly by exchange practice.
In this respect, Kjellberg’s study illustrates how support for and resistance
towards various reforms was influenced not only by re-presentations but also by
the inter- ests that the prevailing exchange practices endowed various actors with.
Thus, wholesale and retail organizations vigorously opposed a suggested ban on
resale price maintenance claiming that buyers and sellers lacked the practical
ability to make the necessary calculations.
In a similar vein, Helgesson shows how AT&T took initiatives to further
develop the theory of natural monopolies in the 1970s when the rationale for
its monopoly was under attack. These initiatives, he suggests, not only
furthered economic theory, but also participated in the normalizing practices
that shaped the regulations directed towards its very own monopoly. In particular,
the theories and methods developed became enrolled in the legal discussions
that led to the break up of the Bell system in the 1980s.
The examples above suggest that normalizing practices should not be treated
as autonomous activities influencing, but not being influenced by
representational and exchange practices. Rather, we suggest, normalizing practices
need to be con- ceived as an integral subset of market practice, deeply implicated
in the shaping of markets.

How do exchanges and norms affect representational practices?

How are representational practices shaped? It is clear that no calculation of market
size, market share and the like can be performed without in some way
measuring facets of exchange practice. Through representational practices,
economic exchanges are aggregated and transformed into pictures, diagrams,
and texts, much like how we characterized the segmentation process in Figure
1.
But in re-presenting markets much more is at stake than a simple reflection of

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Hans Kjellberg and Claes-Fredrik Helgesson

exchanges in themselves. Central to representational practices are ideas

concern- ing what to measure and how to measure, that is, established
measures and methods of measurement. The motif is likely to have had some
import on a renaissance landscape painting serving as a model for an English
garden, but its realization also depended on canvas, oils, current brush
techniques, rules of com- position, etc. Similarly, any re-presentation of a
market thrives on a number of tools, norms and specific procedures.
One example of how this might play out is provided in a study of a Swedish
market court case involving Scandinavian Airline Systems (SAS) and the Swedish
Competition Authority (Liljenberg, 2004). The issue at stake was whether SAS
was abusing its dominant position by applying its loyalty program,
EuroBonus, on domestic airline travels. As in most cases concerning
competitive practices a critical part of the case concerned the definition of the
relevant market. Besides illustrating how normalizing practices depend on re-
presentations, then, the case also illustrates the reverse relation.
The court proceedings show that one may add up as many sales of tickets as one
would like without ending up with a re-presentation of a relevant market. To
acquire the latter, tools are required. Specifically, it was necessary to establish
what measures to use to generate a valid re-presentation of the relevant market.
The tools promoted and employed by the two parties were clearly influenced
by two distinct sets of norms concerning what a market is. Thus, based on the
norms of the Swedish competition law, the competition authority employed
measures and methods of measurement closely related to the Industrial
Organization paradigm. In contrast, SAS employed tools derived from
contemporary marketing theory, including relationship marketing and loyalty
management, suggesting a link to its company-specific normative objectives.
Although often seen as activities simply describing markets, representational
practices are just as involved in producing markets, as are individual
exchanges. Without the concrete abstractions re-presenting ‘the market’, it
would indeed be difficult to talk about markets. Representational practices
thrive on measures and methods of measurements devised by normalizing
practices and applied on exchange practices. Taken together, representational
practices transform these inputs into images of markets that in turn may act
upon normalizing and exchange practices.

Markets as networks of practical translations

In the last three sections we have exemplified ways in which exchange, normaliz-
ing and representational practices are linked through processes of translation. In
doing so, we have also highlighted the role of various intermediaries. Normalizing
practices may produce rules that subsequently become translated into tools that
partake in exchange practices, altering the agency of a seller or buyer. The impli-
cated change in the behaviour of the seller may affect its offers to, and subsequent
exchanges with, potential buyers. Based on norms concerning what to measure
(measures) and how to measure (methods of measurement), representational

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practices may translate altered exchanges into measurements of an altered market.

Such descriptions may in turn be used as part of efforts to alter norms, or feed
back as results that act directly upon exchange practice, for example in the shape
of costing calculations and evaluations of marketing activities. Finally, interests
arising from the exchange situations may feed back into and influence normaliz-
ing practices (see Figure 3).
The resulting image is one of markets as composites of ongoing practices where
each activity is held in place by how it is linked to other activities. In terms of
our conceptual vocabulary, markets are constituted by continuous processes of
translation linking exchange, representational and normalizing practices into
semi-cyclical and reversible chains that intersect and interfere with each other.
Figure 3 specifies the translations we have identified as linking market practices of
different categories.
Returning to the market segmentation example mentioned above we could
illustrate how such a cycle of translations can be forged. A successful market
segmentation procedure, in itself made up of a number of translations, will
produce a set of actionable segments (representational practice). Such a market
description may provide important input to the firm’s strategic planning
process and may as such result in a new set of strategic objectives (normalizing
practice). Via new rules and tools, such objectives may then be translated into
altered design and communication of the firm’s offer to potential customers
(exchange practice). The result of these changes vis-a-vis the selected customer
segments is likely to be monitored and measured (representational practice,
again) and subsequently translated into feedback on current market operations
(exchange practice, again). These descriptions may of course also provide input
for continued strategic work, eventually resulting in modifications of the
normative objectives (normalizing practice, again).
Our model suggests that it is as difficult to conceive a market without
normal- izing and representational practices, as it is to conceive it without
exchange practices. A further merit of the conceptualization is that it does not
designate a centre that could be mistaken as constituting the core of a market,
apart from the practices that constitute it. (Rather appropriately, then, the
graphical centre of Figure 3 is empty.)
Despite the fact that the process illustrated by Figure 3 is fairly complex, it does
not fully underscore the multitude of practices that interact in shaping a
particu- lar market. First, it should be clear from our examples, as well as from
our defini- tion of translation, that the shaping of a market is a continuous
process. That is, in principle it has neither beginning nor end. Indeed, were it to
stop, the market would no longer exist. This is not to say, however, that it is
impossible to identify events that for all practical purposes must be regarded as
setting off important change processes.
Second, this process will involve numerous efforts to normalize, re-present
and exchange. Think for instance of the airline travels mentioned above: The rules
and tools partaking in an individual purchase of an airline ticket are likely to be
the results of many diverse normalizing efforts and several links to various
representa-

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Figure 3
Translations and intermediaries in market practice

tional practices. When conceived in this extended way, the market becomes the
ongoing result of a network of translations that link normalizing, exchange,
and representational practices.
Finally, in this process, ideas and theories about markets are neither
conceived as de-coupled and insulated from practice nor as firmly and exclusively
situated as part of one particular category of practice. Rather, the model suggests
that there is an ideal side to all market practices. This is a critical aspect of the
model since it opens for empirical inquiries into the performative role of ideas
in shaping markets.
Despite the presumed generality of both the three types of market practices
and the processes of translations that link them, we would expect a large
variation in terms of the specific configuration of practices between different
markets. In fact, the relative intensity of the three types of practices, the links
between them and the degree to which the involved actors overlap across
activities may offer a way of probing into differences in the ongoing
constitution of markets. In the next section, we develop some initial thoughts
on such a use of our conceptualization of markets as constituted by practices.

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Market forms as differences in the configuration of market practices

So far, our effort to characterize markets in terms of ongoing practices has dis-
regarded the fact that markets come in many different forms (for a recent
discus- sion, see Håkansson et al., 2004: Chapters 2–4). We have avoided
distinctions such as those between public and private markets or between real
and quasi markets and rather immodestly suggested that any market can be
conceived as the result of chains of translations linking exchange, normalizing
and representational practices. In this section, we argue that our model may very
well be used to discuss variation across different markets, as well as within one
market over time, albeit from a slightly different vantage point than usual. We
also provide four examples of such differences between markets.
Available efforts to distinguish between different types of markets share an
important feature: they characterize them as outcomes, that is, as ready-made
and stabilized structures. This applies irrespective of whether the distinctions are
based on buyer/seller concentration (Scherer and Ross, 1990), influence among
and between exchanges (Easton, 2004), or density of exchange relationships
(Hagedoorn, 1995; Håkansson et al., 1993). It applies also to typologies that com-
bine dimensions, for example the standard IO-grid based on the number of sellers
and the differentiation of offers (Scherer and Ross, 1990), or Sherry’s (1990)
typology based on a formal–informal (marketplace structure) and economic–
festive (marketplace function) dimension.
In contrast to such typologies, our conceptualization of markets may be used
to discuss differences in how markets are being continuously realized, that is,
differences in the ongoing constitution of markets. How do the chains of
practical translations that shape markets differ from each other? Can we
identify different ways in which markets are being configured, or in other
words, different ways in which the constituent market practices are being
linked? To illustrate how the proposed model may enrich current theorizing on
market forms we will briefly present the contours of four different
configurations of market practice that can be observed in empirical studies of
markets.

Differences in ongoing realizations of markets

First, some markets are being realized through intense associations between
exchange and representational practices. By continuously monitoring and
trans- lating exchange practice into images of the market, which are
subsequently fed back into exchange practice, the smallest of changes in
exchange practices is rendered visible. Considerably less intense associations
between representational and normalizing practices indicate that the measures
and methods of measure- ment used to generate market images are fairly stable.
Similarly, relatively sparse associations between normalizing practice and
exchange practice indicate stable rules for the involved actors. Ethnographies of
financial markets suggest that such

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Hans Kjellberg and Claes-Fredrik Helgesson

markets fit relatively well with this configuration (cf. Knorr-Cetina and
Bruegger, 2000). Possibly, financial markets are characterized by particularly
intense efforts to re-present certain aspects of exchange, rather than by the
presence of something resembling perfect competition (but see Baker, 1984).
Second, some markets are at times being realized through particularly extensive
exchange practices. In such markets, the exchange parties as well as the objects
and terms of exchange are either poorly specified, or subject to change efforts.
This leads to relatively intense organizing efforts at the level of individual
economic exchanges. What are the competences of the exchange parties? What
should the object of exchange be like? Under what conditions should the
exchange be made? In their efforts to resolve such issues, actors such as buyers
and sellers engage in repetitive and rich interactions. At the same time, the efforts
to establish norms for and re-present the market are less conspicuous. In such
situations, it may seem appropriate to characterize the market as consisting of
exchange relationships rather than single transactions. Many of the descriptions
of industrial markets provided within the markets-as-networks/IMP tradition
can be used to exemplify this configuration (see for example Håkansson and
Snehota, 1995; Lundgren, 1995).
Third, some markets are being realized through particularly intense
normaliz- ing efforts. Here, considerable work is put into devising normative
objectives for various groups of actors. Either the rules of the game have not
been fully worked out, or the existing ones are poorly specified and/or subject
to controversies. Such questioning of fundamentals may arise due to problems
indicated by available re-presentations or as a consequence of clashing
interests. This makes consider- able overlapping of actor roles likely. Seemingly
the same actor may interchange- ably be involved in performing individual
economic exchanges, attempting to establish new rules and objectives and
create images of the situation. The market appears instable and political. This
configuration can be illustrated by descriptions of markets in transition,
regardless of whether the transition was triggered by state intervention,
technological development, or environmental change (see for example
Fligstein and Mara-Drita, 1996).
Fourth, markets are at times constituted by exchange, normalizing and repre-
sentational practices linked through highly stabilized chains of translations that
distance practices of different categories from one another. In such markets
economic exchange takes place against a backdrop of norms that are being worked
out, evaluated and modified largely independently of exchange practice. Similarly,
the monitoring of exchange activity is clearly separated from economic exchange.
The division of labour between actors is clear; some engage primarily in economic
exchange, some in shaping norms and objectives, and some in generating re-
presentations of the market. That is, the translations linking the various types
of market practices have been stabilized, making the ongoing realization of the
market more difficult to detect. As a consequence, normalizing and representa-
tional practices seem external to the market, which is regularly described as
con- sisting only of exchange practice. Descriptions of certain markets for fast-
moving consumer goods, such as food retailing, can be used to illustrate this
configuration

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(cf. Cochoy [forthcoming]). In these markets, there is little question about the
import of either normalizing practices, for instance legislation regulating the
marketing of food products, or representational practices, for instance regularly
published market overviews, market share figures, etc. However, these
practices are easily taken to be external to the actual market, providing something
like infra- structure and maps.

Merits of the approach

The four configurations of market practice sketched above are necessarily
coarse, incomplete and preliminary. More importantly, they are but examples
of a much larger set of ways in which markets may be constituted by practices
linked through translations. The examples merely indicate the possibility of
systematically dis- cussing differences in market forms from a practical
starting point, focussing on the concrete activities being performed. There are
several reasons why we believe that such an approach may make a useful
contribution in relation to established typologies. First of all, it will allow us to
appreciate differences in markets without assuming their existence at the outset
of inquiry. Returning to our English garden metaphor, it hardly seems strange
that variation in terms of gardening practices will indicate differences between
gardens; for example, between a garden being laid out, tilled in the spring,
cultivated, rearranged, etc.
Second, conceiving markets as constituted by practice allows us to account for
the import of market ideas in shaping markets. Both in terms of what ideas par-
ticipate and how these ideas participate. Such participation has been recognized
within industrial organization (Shepherd, 1979) and through concepts such as
network theories in markets-as-networks models (Johanson and Mattsson, 1992).
However, it has proven difficult to include such ideological influences in con-
ceptions of markets based on, for example, concentration of buyers and sellers, or
network structure. In other words, attending to the translations between market
practices may account for how different forms of market knowledge contribute to
shape markets.
Third, attending to the interplay between exchange practices,
representational practices and normalizing practices can provide an alternative
view of how markets evolve and hence provide us with new tools in our efforts
to alter them. Having said this, it is important to underscore that the differences
in realization discussed above are not to be taken as stable, once-and-for-all
characterizations of particular empirical markets. Rather, a specific market is
likely to undergo con- figurational phases of longer or shorter duration. Thus,
an effort to re-regulate a financial market exhibiting intense associations between
exchange and representa- tional practices will not only intensify normalizing
practices but also the trans- lations that link normalizing to exchange and
representational practices.

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Concluding remarks: on performativity and practical market

configurations
The four examples given above of differences in how markets are being
realized can be used as a starting point for discussing the kind of
performativities, or ways in which ideas take part in shaping markets, that are
especially interesting to investigate further. Although most issues concerning the
performativity of market ideas remains to be studied, it is safe to say that the
efforts made so far have focused on the performativity of theories developed in
economics and financial economics. A majority of the empirical work reported
above fall into these categories. This correlates with two of the four suggested
configurations having been more studied when it comes to performativity.
First, financial markets that simile our first configuration are already being
widely studied. Second, markets subject to market reforms, similar to our third
configuration, are also being studied as regards to how economics participates
in the shaping of those reforms and the resulting markets.
Our conclusion is that there is a striking lack of studies concerning the perform-
ativity of market ideas in the second and fourth configuration of market
practices suggested above. From a marketing perspective, this is highly interesting
since it is probably within these two configurations that the performativity of
marketing theories would be especially important. Here, we believe that the
academic disci- pline of marketing is a particularly apt partner in enlarging the
field of study on the performativity of market theories in the shaping of
markets.
We do not argue that financial markets are devoid of marketing theories, nor
that economics cannot play a performative role in markets for consumer goods.
Indeed, another interesting topic within the endeavour envisaged here is to
investigate how different market theories are translated and entangled with one
another in a particular setting. Indeed, the SAS market court case mentioned above
indicates what an encounter between two such ideas, i.e. a loyalty program
based on contemporary marketing theory and the concept of abuse of dominant
position based on industrial organization theory, might entail for the shaping of
a market.
A central theme in this article has been to address the issue of how ideas
about markets partake in their shaping. What kinds of ideas about markets
circulate in our society? How are these ideas translated into norms, individual
exchanges and images of markets? What are the consequences of these
translations? Do calcula- tive tools developed on the basis of, for example,
rational utility maximization, result in a better provision of goods or in the
provision of better goods? How do we know?
The approach presented here does not provide any simple answers to
questions concerning efficiency or desirability. But it can, in a critical spirit,
capture the multitude that is characteristic of markets and provide us with a
view of the avail- able alternatives. Therefore, we believe that this
conceptualization will allow actors within business, politics and academia alike to
seek answers to questions concern- ing what is desirable and to shape markets
along the lines of their answers.

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The market is not already perfect, neither as an idea nor in practice, to allude to
Voltaire’s critique of Leibniz’ optimistic philosophy. It is unlikely that it ever will
be, least of all through some independent, natural automatic. And if markets are
regarded as resulting from entangled collective actions, as we have argued in this
article, their development and consequences become a continuous joint responsi-
bility. In ending this article, then, it seems appropriate – also in the light of our
parallel to the English landscape garden – to borrow a well-known phrase from
Voltaire: Il faut cultiver son jardin.8

Acknowledgements
The authors want to thank Anders Liljenberg at the Stockholm School of Economics
for the co-operative efforts that made this article possible. We also want to thank
the participants of the IMP Market Studies Group Workshop in Marseille (23–26
April 2004) as well as three anonymous reviewers for helpful comments on earlier
versions of this article.

Notes
1 The hands of the gardener perfecting an English landscape garden were to be as
invisible in the final result as the divine invisible hand at work in the market.
2 There are some obvious links between our stance and the real-becoming tradition
within organization studies (Chia, 2000; Tsoukas and Chia, 2002). Two important
points of distinction are worth noting. First, our position extends beyond the discur-
sive field to include a wide variety of activities. Second, we conceive of the process
that shapes reality as materially heterogeneous, involving humans and non-humans
alike. To avoid privileging anyone or anything at the outset of inquiry (Law, 1994),
we therefore draw on the expanded principle of symmetry, asserting not only that
we should use the same register to account for truth and falsity (Bloor, 1976), but
also for social, natural and technological phenomena (Callon, 1986). The latter is
especially important when it comes to the issue of agency in relation to the shaping
of reality: What is it? Who has it? How do they acquire it?
3 This line of reasoning draws on the distinction between ostensive and performative
definitions of the object of inquiry, as developed by Latour (1986). While the object
of an ostensive definition is inertial, ‘the object of a performative definition
vanishes when it is no longer performed’ (Latour, 2005: 37).
4 Alfred Schutz offers a similar line of reasoning in his discussion of the different
time perspectives that characterize our participation in ongoing action, on the
one hand, and our reflections on performed acts, on the other (Schutz, 1962).
5 It is important to stress that we do not limit our use of the term to activities linked to
established professions, clearly defined roles, or social contexts, as seems to be the
standard definition employed in the communities-of-practice tradition. For instance,
Cook and Brown (1999: 386–7) define practice as ‘the coordinated activities of
individuals and groups in doing their “real work” as it is informed by a particular
organizational or group context’. Similarly, Brown and Duguid (2001: 203) define
practice as ‘undertaking or engaging fully in a task, job, or profession’.
We use the term practice as a micro-level concept that resembles Holt’s (1995) use

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Hans Kjellberg and Claes-Fredrik Helgesson

of the term consumption practices as the basic conceptual unit for describing con-
sumers’ actions. However, we differ from Holt’s definition of practices as ‘the
embodied skills that people bring to bear in their everyday activities’ (1995: 1) by not
reserving the term exclusively to human individuals. Instead we prefer the more
neutral and symmetrical term acting entities for those who practice.
6 The model presented here is a result of a four-year project to edit a Swedish volume
developing a practice-view on markets. The project started as a reading group
involv- ing eight researchers who eventually contributed seven case studies,
primarily drawn from their thesis-work. Our model grew out of the process of
reading key theoretical contributions in parallel to developing the case chapters, and
was revised on several occasions. It is this systematic combining (of theoretical
and empirical work in gradually developing a model) that constitutes the core of
our abductive approach (Alvesson and Sköldberg, 1994; Dubois and Gadde,
2002).
7 This is not a post-modern argument. We do not propose a reversal of the relation
between the signifier and the signified (cf. Firat, 1992: 81). Our argument is that the
two are co-constituted and that primacy cannot be attributed to either one. Hence,
there is no underlying market that is being re-presented (modernist) or shaped by
(post modernist) representational practices. Our argument is that markets cannot
exist without re-presentations, that representational practices are constitutive of
markets, but that they are but part of that which shapes markets.
8 ‘Let us cultivate our garden’ (Voltaire, 1991 [1759]: 88).

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Hans Kjellberg is associate professor at the Department of Marketing and Strategy,

Stockholm School of Economics and an associated researcher at the Stockholm Center
for Organizational Research. His research interests concern economic organizing in
general and the shaping of markets and economic exchanges in particular. Together
with Anders Liljenberg, the author received the ‘Marketing Book of the Year’ award
from the Swedish Marketing Federation in 2005. Address: Department of Marketing
and Strategy, Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm,
Sweden. [email: [email protected]]

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articles

Claes-Fredrik Helgesson is associate professor at the Department of Marketing

and Strategy, Stockholm School of Economics and a research director at the
Stockholm Center for Organizational Research, where he heads a research program
entitled ‘Organizing Markets’. His research interests concern the intertwining of
science, tech- nology and economic organizing. Address: Stockholm Center for
Organizational Research & Stockholm School of Economics, Score, SE-106 91
Stockholm, Sweden. [email: [email protected]]

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