Dissertation Research: The scientization of risk management in the finance industry through credit scoring technology and the production of socio-economic order in the U.S.

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This Science and Technology Dissertation Improvement Grant will fund research in the U.S. and France toward the completion of a dissertation that will seek to extend the tools developed by STS researchers for the analysis of scientific practice and technological development to the study of economic technologies. Instead of producing facts, economic technologies produce information for the construction of rational capitalist markets. Just as STS has shown how universal orders are constructed for the natural world through socio technical practices, this project will show how these same practices can equally produce objects (like the credit score) that serve to stabilize order in the social world. The intellectual, organizational, infrastructural, and political processes behind the construction of economic technologies, are strikingly similar to the ones STS has traditionally analyzed. In the current case, the U.S. bureau scoring system arises out of the articulation between an information infrastructure that consolidates nationwide credit repayment data from financial institutions in the credit bureaus, the proprietary statistical model of a single creative analytics company (.the Fair Isaac Corporation), and the ethos of profit maximization. Central to the history of bureau scores is the story of how Operations Research, a physics- and military--derived, scientized way of knowing., was transformed by companies like Fair Isaac into a commercial product and sold to the finance industry in the latter part of the 20th C to solve the problem of managing unpredictable human behavior. The case shows how science and technology has been enrolled by large-scale capitalist enterprise to produce a scientific principle of evaluation that aligns the social and economic systems. To trace the history of the FICOTM score, data will be collected by the co-PI through interviews with Fair Isaac and credit bureau employees, including VP's, operations researchers and risk analysts, identified through availability and snowball sampling. Fair Isaac corporate newsletters (1975-present) will be analyzed, as well as corporate, trade, popular, business, government and web based literatures related to credit and scoring (1950-present). To strengthen the analysis an NSF Doctoral Dissertation Research Improvement Grant will be used to add a crucial international dimension to the project. Field research on Fair Isaac's frustrated attempts to extend a standardized credit scoring model to France will serve to highlight the particular articulations that have led to the company's success in the U.S. The project's results will have a broader impact on the credit industry's understanding of the contingency of technology and technology transfer, as well as on the understanding of the public's stake in the FICOTM scoring systems. The project's intellectual merit will come from the uniting of STS and economic sociology to analyze the scientization of risk management, the participation of consumers in capitalist markets, and the role of economic technology in creating social change in the 21st century.