Making the Grade: Classification as Signification on Chicago and New Orleans Futures Markets, 1856-1915

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Abstract

This paper contributes to an infrastructural analysis of derivative markets through an account of the creation and development of futures markets on the Chicago Board of Trade and the New Orleans Cotton Exchange between 1856 and 1915. It takes as the starting point of analysis the dissimilar systems by which futures markets were linked to their underlying markets in commodities. This article argues that these systems produced commodity classifications with distinct semiotic features, which in turn promoted divergent behaviors on the futures market: high-risk speculation in Chicago and low-risk hedging in New Orleans. The analysis begins from the material features of wheat and cotton, then moves to examine the process of grading and its incorporation into practice, and finally traces the consequences of these for market behavior. By illustrating the impact of infrastructure—via the semiotic character of the classifications it creates—on market behavior, these cases demonstrate how even similar socio-technical arrangements can give rise to distinct market systems.

Author

• David L. Pinzur, University of California-San Diego