Futures Trading, Technology, and Institutional Change

Summary: A study of the institutional change associated with the shift from open outcry to electronic trading in financial futures. I conducted an in-depth ethnography of a face-to-face trading organization, comparing it to 4 electronic trading firms. My key finding is that what appears to be a technological change in how traders make markets is actually a deep, institutional change in the actors, objects, and activities involved in making markets. Electronic trading changes what counts as information, the expertise of traders, and the relationships between individuals and the market.

Electronic trading is to open outcry what the internet is to the telephone. Not just a more efficient way to do the same thing, but potentially a whole new thing altogether…

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