The Formal Market

Normally, when social scientists pay attention to markets, their focus is on how markets affect other areas. What markets do to or how markets transform other things. For instance, there is plenty of research about ‘commoditization’ (how things are turned into objects of commercial exchange), about ‘marketization’ (e.g. how the organization of situations as markets make agents calculative and things calculable)-, or, about ‘neoliberalism’ and how individuals and populations are made subjects of market-forms of governmentality. Way less interest has been devoted to the study of how markets are affected by other processes. The object of analysis in this paper is the “Harmonized Electricity Market Role Model”, an instrument developed in the context of the ongoing technical standardization of the European electricity market. How does the Harmonized Electricity Market Role Model relate to the European electricity market? To answer this question, we propose the concept of the ‘formal market’. The argument, in short, is that, as the organization became formal organization about a century ago with the work of the engineers of the scientific management movement, markets — like the electricity market in Europe —, become ‘formal markets’ with the contemporary work of engineers and technical standardization. Besides analyzing the case study, we conceptually develop the idea of formalizing, and explain how the concept of formal market could help future STS and sociological research on market organization and design more generally.