May 22, 2007

Toward a Derridean Economics

Filed under: Economics, Philosophy — duncan @ 7:16 pm

Derrida is such an important figure for me that I’m uncomfortable writing about him with the glibness of a blog. But I chose to write a blog, largely because it permits glibness. So I’ll deal with it.

Derrida’s most notorious soundbite (from ‘Of Grammatology’, page 158) is, of course, “there is nothing outside of the text” (“il n’y a pas de hors-texte”). Perhaps a better formulation of the same idea comes earlier in the Grammatology (p. 49): “The thing itself is a sign.” Here is the American philosopher Henry Staten (also a canonical figure for me), explaining how to read this phrase:

“’The thing itself is a sign’ does not mean ‘there isn’t really any ‘thing itself’’; nor does it mean ‘the thing is really all in your mind’; nor ‘there are really only words – we can’t get outside of words’. It means approximately this: ‘Let us consider the experience of what we call ‘things themselves’ as structured more like the experience of signs than like the experience of an idealized ‘full presence’.” (The quote is from page 58 of Staten’s first book, ‘Wittgenstein and Derrida’ – purchasable at Amazon at the bargain price of $25.)

I have no desire to align myself with either Derrida or Staten here. I have considerable sympathy for the accusation so often and so lazily levelled at deconstruction: that it is a culpably irresponsible form of linguistic idealism. I want to defend Derrida against his Neanderthal critics, but I’m weary of the debates surrounding his work, and I’m willing to give succour to the enemy in the hope, if not the confidence, that intelligence will prevail.

So: The thing itself is not a sign. There is something outside of the text. But even if we insist on this, we still have much to learn from Derrida.

The key contrast in the passage I’ve just quoted is between the idea of a sign and the idea of ‘full presence’. Let me try to summarise the argument in the crudest possible way.

A sign is always, by definition, a substitute for something else. Its purpose is to direct our attention to something beyond it. A sign is thus (to use the loaded vocabulary that Derrida analyses) parasitic, derivative, or supplementary.

By contrast, the thing itself seems to have a secure independent substance. It does not depend on anything else for its meaning or content. It is self-sufficient. This is what Derrida calls ‘presence’. A sign only has meaning because the thing it represents is absent. The thing itself, on the other hand, requires no absence to give it content; it is ‘fully present’.

This is the traditional picture of the relationship between sign and object. But Derrida has no truck with it. Derrida believes that all the properties traditionally ascribed to signs are also possessed by things themselves. For our purposes, the argument can be put like this:

A sign is a substitute for an object. When the object is absent, the sign can stand in its stead. There is a relation of partial equivalence between them.

But this relation of equivalence necessarily runs both ways. If a sign can be substituted for an object, the object can be substituted for the sign. And if the thing itself is, in certain circumstances, equivalent to a non-self-sufficient sign, then the thing itself cannot be said to be fully self-sufficient.

In other words, as soon as we refer to an object, that object is implicated in the network of substitutions that is our symbol system, and we can no longer refer to an absolutely self-sufficient object outside of all symbol-systems. Indeed – it is impossible to refer to an absolute ‘outside’ of our symbol systems at all. (Though it is of course still possible to refer to the outside of any given symbol – that’s what a symbol is.)

This is a tinkertoy version of Derrida’s argument – please don’t think I’m doing him justice. But even in this dumbed-down version, its easy to see the relevance of it all for economics.

Consider, for example, the relation between the ‘real’ and the ‘money’ economies. The standard definition of money is ‘a medium of exchange and a store of value’. Both aspects of this definition suggest that money is derivative or parasitic. Money is a symbol. Commodities are the things themselves that we can purchase with our symbols.

This is, I suppose, correct as far as it goes. But if we take this distinction too literally, or insist on it too tenaciously, grievous error will result.

Consider, for example, conspicuous consumption. All those expensive clothes and cars, those immense mansions and flamboyant parties. Are these ‘things in themselves’? Or are they symbols? And if they are symbols, what do they symbolise?

They symbolise money. When exchanging money for some priceless eye-catching trinket, we are not exchanging a store of value for the value itself. We are purchasing, among other things, a representation of our bank account. Our diamonds symbolise money, not the other way around.

Or, rather, both ways round. For money is a commodity like any other, and in the system of substitutions that is our economy, we cannot draw a boundary of essence between ‘money’ and ‘the real’. Money is not a transitional phenomenon; it cannot be factored out. The condition of possibility of money is a limitless interchangability of commodities; and this is the very condition that makes a rigorous distinction between money and non-money impossible.

This is not, to be sure, news to economists. See, for instance, chapter 21 of Keynes’s General Theory. Keynes criticises his predecessors’ tendency to treat the theory of value (real economy) and the theory of prices (money economy) in isolation from each other. And he goes on to say:

“We cannot get rid of money even by abolishing gold and silver and legal tender instruments. So long as there exists any durable asset, it is capable of possessing monetary attributes and, therefore, of giving rise to the characteristic problems of a monetary economy.”

This can be put in stronger terms: so long as there exists any durable asset, it already possesses monetary attributes. For there is nothing outside of money. (The thing itself is a dollar.)

A Derridean economics would thus find powerful allies in the economic mainstream. But I wonder how many economists have pursued Keynes’s insight to its logical conclusions. For that matter, I wonder what those logical conclusions are….

This is all a work in progress.

Blog at

%d bloggers like this: