Quality, Exchange, and Knightian Uncertainty

Sociologists have long recognized that stable patterns of exchange within a market depend on the ability of market actors to solve the problem of cooperation. Less well recognized and understood is a second problem that must be solved – the problem of Knightian uncertainty. This chapter posits that the problem of Knightian uncertainty occurs not only in the market; it underlies a variety of exchange contexts – not just markets, but art worlds and professions as well. These three exchange contexts are similar in so far as a generally accepted quality schema arises as an important solution to the problem of Knightian uncertainty; however, the quality schemas that arise in these three contexts differ systematically along two dimensions – the complexity of the schema and the extent to which the “non-producers” have a voice in the determination of the quality schema. By comparing and contrasting the way in which quality schemas arise in these three domains, this chapter (1) gives some specificity to the notion of quality as a social construction, (2) provides some preliminary insight into why a particular good or service becomes perceived as a market, artistic, or professional offering, and (3) offers an imagery for conceptualizing the mobility of goods and services between these three domains.