Money, Financial Institutions and the Social Order

Financial services companies are in the business of making money from money: money lies at the heart of what they do and what they are. Yet, as Dodd notes, ‘existing sociological analyses of money are relatively insubstantial’ partly because of the ‘failure to recognise its importance as a consequential social institution’ (Dodd, 1994: vi). If, however, there is one thing which defines financial services companies it is their role in the management, control and distribution of money. In this chapter, we firstly examine in general terms the nature of money and its social construction. Through examining money we can identify the crucial underlying social structures within which financial institutions are embedded. Secondly, we elaborate the particular nature of that embeddedness in the British context. This involves understanding both the way in which the various institutions link together and the way in which the nature of these linkages are understood and articulated by social actors.This enables us to identify the key conditions for the reproduction of this embeddedness at both the level of the system as a whole and at the level of the social actors themselves. In the following chapter, we examine how these conditions for reproduction began to change from the 1960s onwards. As they changed, the interconnections between the elements of the system had to be renegotiated, a process which involved the reconstruction of the elements themselves into new entities. This also necessitated the development of new modes of understanding the system on the part of the actors. The interface between the changing interrelationships and entities and the changing understanding of the actors constitutes our focus of attention in the next part of the book.