Making the Grade: Infrastructural Semiotics and Derivative Market Outcomes on the Chicago Board of Trade and New Orleans Cotton Exchange, 1856-1909

This paper contributes to the socio-technical analysis of derivative markets through an account of the creation and development of futures markets on the Chicago Board of Trade and the New Orleans Cotton Exchange between 1856 and 1909. It takes as the starting point of analysis the classification systems by which these futures markets were constitutively linked to underlying markets in agricultural commodities. The paper argues that, despite the formal similarity of the grading infrastructures in these cases, their differing implementation—how grades were produced and integrated into practice—led to divergent outcomes. Grades on each market conveyed to traders different information about commodities, futures contracts, and the relation between them. This semiotic distinction is shown to have promoted divergent economic behaviors and outcomes on the two markets: high-risk speculation and volatility in Chicago, low-risk hedging and stability in New Orleans. The article thus traces a path from the creation of the market’s foundational infrastructure through to its consequences on economic behavior.