Assetization: A New Logic of Technoscientific Capitalism

368
Assetization: A New Logic of Technoscientific Capitalism

How the asset—anything that can be controlled, traded, and capitalized as a revenue stream—has become the primary basis of technoscientific capitalism.

Kean Birch and Fabian Muniesa. 2020. Assetization: Turning Things into Assets in Technoscientific Capitalism, MIT Press.

Sources: 

https://mitpress.mit.edu/books/assetization

https://direct.mit.edu/books/book/4848/AssetizationTurning-Things-into-Assets-in

Our lives are increasingly shaped by the practices and innovations of technological giants, and our times are increasingly defined by the technoscientific aspects—that is, by the development of new technological products and services (e.g., smartphones, apps, platforms), the emergence of trendy scientific specialties (e.g., big data, AI, biotech, fintech), and the alignment of innovation processes, actors, and institutions with powerful investment rationalities and financial imperatives. The very notion of "technoscientific capitalism"—terminology whose origins can be traced back at least to Jean-Francois Lyotard (1984, 1992)—aptly captures the defining problematics of our political-economic time.

In the book, Assetization: Turning Things into Assets in Technoscientific Capitalism, Kean Birch and Fabian Muniesa argue that assets-anything that can be controlled, traded, and capitalized into a revenue stream- have become the primary basis of technoscientific capitalism. The dominant form that technoscientific capitalism affords is not the commodity but the asset, and that the financial contours it entails are not those of market speculation but of capital investment.

An asset can be an object or an experience, a sum of money or a life form, a patent or a bodily function. A process of assetization prevails, imposing investment and return as the key rationale, and overtaking commodification and its speculative logic. Although assets can be bought and sold, the point is to get a durable economic rent from them rather than make a killing on the market. Assetization examines how assets are constructed and how a variety of things can be turned into assets, analyzing the interests, activities, skills, organizations, and relations entangled in this process.

The collection of studies gathered in this book originated in an open call for proposals for a panel on "Turning Things into Assets" at the 4S/EASST 2016 conference in Barcelona. Divided into four sections, the book discusses four types of assetization processes: the assetization of knowledge, including patents, personal data, and biomedical innovations; the assetization of infrastructure, including railroads and energy; the assetization of nature, including minerals, agricultural seeds, and natural capital; and the assetization of public goods, such as higher education and social issues. Taken together, the chapters show the usefulness of assetization as an analytical tool and as an element in the critique of capitalism. This book is open access and you can read the full text on the publisher's website.

we cannot characterize and analyze technoscientific capitalism solely in commodity terms anymore, not in the era of Uber and Airbnb, Google and Amgen. Can we understand the "unicorns" stalking Silicon Valley (i.e., firms whose notional valuations top $1 billion, promising huge returns to shrewd investors), the biopharmaceutical firms ramping up drug prices (while buying back their shares to shore up their share value), and governments turning the atmosphere into financial assets (and giving them away to polluters) without struggling within prevailing conceptions of the commercialization, marketization, and commodification of technoscientific research and innovation?

As a consequence of an emerging "asset form" that has come to replace the commodity as the primary basis of contemporary capitalism. By asset, we mean something that can be owned or controlled, traded, and capitalized as a revenue stream, often involving the valuation of discounted future earnings in the present—it could be a piece of land, a skill or experience, a sum of money, a bodily function or affective personality, a life-form, a patent or copyright, and so on. Discounting reflects an assumption about the future value of money, which is framed by expectations about future inflation, risks, and uncertainties. Assets can be bought and sold, yes. But the point is to get a durable economic rent from them, not to sell them in the market today; here we use the term rent to mean the extraction of value through the ownership and control of an asset, which usually entails limiting access to it.

What Is the Asset Form? What Is Assetization?

Our adoption of the notion of the asset is meant to disentangle considerations of the asset as both an objective resource (aka factor of production) and as a subjective value (or effect of valuation practices)—that is, its form and the condition it engenders.

Assetization emphasizes the socially transformative character of the phenomenon of turning things into assets—it can refer to that phenomenon proper as much as to its societal consequences (i.e., "asset condition").

It is possible to identify at least seven aspects that mark out the asset form as a distinct analytical and practical entity.

First, assets are legal constructs, in that ownership and control rest on the state enforcement of property and control rights. Critically, assets can entail the separation of rights from the thing involved as well as the differentiation between the ownership and control of an asset through forms of contract and property law. For example, although they cannot be owned, customers can still be classified as an asset in that access to them can be controlled.

Second, assets involve distinct modes of ownership and control. In particular, knowledge, creative, or data assets (e.g., intellectual property rights or IPRs) have been legally instituted to give owners both exclusion rights to the use of the asset itself and to the use of any copies derived from the asset. Such "flow-through" rights enable asset holders to control the way that copies or derivatives of an asset are used or experienced, in contrast to commodities. For example, no one can tell you how to wear a coat you have bought, but they can tell you how to use the copyrighted music or data they have sold you.

Third, assets often involve forms of "rentiership" in which monopoly control—derived from, for example, IPRs or government fiat—enables the extraction of economic rents. Assets are often unique, meaning that their value derives from their asset specificity; as such, it is not possible to reproduce them easily, cheaply, or even at all. For example, a parcel of land is unique and nonreproducible, while a specific copyright cannot be legally reproduced without permission.

Fourth, as the result of being unique or constructed monopolies, assets have distinct supply and demand logics in which rising asset prices do not lead to new producers or creators entering a market and thereby lowering prices.

Fifth, asset value can be discounted in light of forward-looking expectations about future returns on investments, whether or not those expectations are met. For example, the ways that expectations about ever-rising house prices in Anglo-American economies have instituted a new accumulation regime (asset-based economy), which configures social relations and inequalities in particular ways. This raises serious questions about whose future interests come to shape current policies and institutions.

Sixth, asset prices and valuations are subject to the actions of owners who may seek to reduce the economic value of their assets, or turn an asset into another form, transfer ownership, or use it to attract new partners

Finally, asset value and valuation are dynamic, in that they are constituted by an active and ongoing management of that value by social actors who are both internal (e.g., managers) and external (e.g., financial analysts) to an organization. For example, an asset's value is configured by an ecosystem of diverse financial, technoscientific, political, and social actors, ranging from corporate lawyers through stockbrokers and stock analysts to policy-makers and universities.

Almost anything can be turned into an asset given the right techno-economic configuration. Even personality sells; for example, the YouTube star PewDiePie has more than 100 million subscribers and earns millions of dollars every year by playing computer games and making gurning noises.

Turning Knowledge into Assets

In Chapter 2, Patents as Assets: Intellectual Property Rights as Market Subjects and Objects, the author argues that the turning of patents into assets is not only a symptom of capitalization and assetization of technoscience with novel ways and degrees of speculative financialization. The assetization of patents represents a new frontier, a novel financial "innovation", affecting a knowledge practice that hitherto had not been regarded as an object of speculation: law. Speculation about legal outcomes and decisions drives this novel financial asset. Whereas law has enabled the creation of a market in patents as assets, but it has now become a financialized market object itself.

Chapter 3, Datassets: Assetizing and Marketizing Personal Data, focuses on an emerging "asset class" in relation to personal data, or the success and vicissitudes of behavioral data capture: data brokers, tracking technologies ("cookies"), and data management platforms.

Chapter 4, A Crisis for Cures? Tracing Assetization and Value in Biomedical Innovation, discusses the logic of the "pharmaceutical asset" increasingly controls the dynamics within the industry. The spread and articulation of the doctrine of shareholder value maximization create quite a specific situation. Rather than being evaluated in the light of their current profitability, large pharmaceutical companies are considered through their potential to deliver future earnings for shareholders. This translates into a somewhat paradoxical form of limitation—if not cancellation—of the very finality of pharmaceutical innovation, which is (or ought to be) to develop cures in the present.

Turning Infrastructures into Assets

Chapter 5, High-Speed Contradictions: Spanish Railways between Economic Criticism and Political Defense is a contemporary case study of an ambitious high-speed rail infrastructure program in Spain allows her to expose the essentially unstable aspects of the process of turning railway transportation into a viable, competitive asset. As a process, the assetization of infrastructures requires the constant production of its conditions of possibility. It also involves, rather than a straightforward process of privatization, an ongoing reconfiguration of the public sector.

Chapter 6, Turning Sunlit Rooftops and Windy Sites into Energy Assets, has explored the territorial/spatial dimension of assetization processes, a point that has not been covered in the literature about assets. Our analysis shows that assetization cannot be reduced to a process of turning a well-delimited object or entity into a financial product. Instead, it is a process that associates a future value and revenue stream with an object or entity by including it in an agencement.

Turning Nature into Assets

Chapter 7, Expropriating the Future: Turning Ore Deposits and Legitimate Expectations into Assets argues that the "capitalization syndrome" is able to exert its influence on mineral exploration—and conflicts between mineral extraction companies and host states or communities—in large part because of the durable legal foundations through which the promise of future revenue streams is made to appear feasible. It is the norms of international arbitration, together with the discourse of resource nationalism and political risk, that allow mineral exploration firms and their investors to capitalize on legitimate expectations. It is the putative legitimacy of these expectations that must be punctured if host communities and states are to regain control of the temporal politics of mineral asset management.

Chapter 8, From Commodity to Asset and Back Again: Property in the Capitalism of Varieties, turns to a controversy between German wheat breeders and farmers over the nature of the seed sold from the former to the latter: should it be treated as a commodity or as an asset—and if so, whose?

Chapter 9, Turning Nature into an Asset: Corporate Strategies for Rent-Seeking, investigates this process and asks: How does the natural capital accounting (NCA) of corporate turn nature into an asset? With what drivers, roles, and stakes?

Turning Publics into Assets

The provision of social services is another key object of inquiry for assetization. Chapter 10 English Higher Education: From a Public Good to a Public Asset, examines the introduction of performance measurements (such as the Research Excellence Framework and the Teaching Excellence Framework), variable tuition fees, and autonomy in university governance in English higher education have led to the development of a British "new cultural epoch of managerialism". The extent to which this is a cultural epoch of assetization requires that we examine how higher education and its publics are transformed (or not) into the asset form.

Technoscientific capitalism entails a wide variety of financial instruments that rely on the identification of "monetizable social ills", as a way to improve social services. In Chapter 11, Recidivists, Rough Sleepers, and the Unemployed as Financial Assets: Social Impact Bonds and the Creation of New Markets in Social Services, Williams scrutinizes the case of the investment-based funding model known as social impact bonds (SIBs), and illustrates how the public's "social ills", adopt the contours of a monetizable asset form—or, in other words, of an investee condition.

Related CityReads

47.CityReads | Cities and Ideas: Bigger Is Better?73.CityReads | What Technologies Can Do for the Future of Cities
92.CityReads | Expulsions: the Brutal Logic of Global Economy105.CityReads | When Local Housing Becomes a Financial Instrument180.CityReads | Castells on The Rise Of Social Network Sites
220.CityReads | How Finance Has Changed the Nature of Cities253.CityReads | Piketty Traces How Inequality Changes Ideology
267.CityReads | Rise of the Platform Society
295.CityReads | How the Innovation Complex Has Changed Our Cities?296.CityReads | Platform Capitalism’s Hidden Abode314.CityReads | Reprivatizing Warsaw by Judicial Robbery324.CityReads | How Should City Use Data for Public Good?327.CityReads | Social Media as the Hype Machine
336.CityReads | Capital in 300 Years
338.CityReads | How Green Became Good?340.CityReads | Privacy in the Age of Big Data: Orwellian vs. Kafkaesque366.CityReads | The End of Capitalism Is…Participatory Socialism（Click the title or enter our WeChat menu and reply number ）

CityReads ∣Notes On Cities

"CityReads", a subscription account on WeChat, 

posts our notes on city reads weekly. 

Please follow us by searching "CityReads"