Investing prudently: How financialization puts a legal standard to use
Résumé
This article reviews the recent history of the prudent investor standard, which provides clear evidence of the changes taking place in American capitalism. By studying legislative, regulatory and judiciary processes together, we can observe how transformations have affected the production and institutionalization of the standard over time. Its meaning has been negotiated both where the federal government's power to regulate meets the political sway of employers and financiers and at the junction between magistrates’ procedural independence and the intellectual authority deriving from economic theories. This method shows that there is no one, single, legal definition of “prudence” but, instead, several connotations that overlap, suggesting that the force of law is (also) based on a semantic diversity, nevertheless instrumental in the structural evolution of financial capitalism.