The Use and Promises of Machine Learning in Financial Markets: From Mundane Practices to Complex Automated Systems

This chapter examines the use of machine learning (ML) in financial markets and argues that the adoption of ML into finance is bringing to light new issues that have traditionally fallen outside the purview of the sociology of finance and financial modeling. Furthermore, the chapter argues that the use of ML methods may be facilitating a cultural and infrastructural alignment between big tech and financial services through both the adoption of open source software within finance and the dependence of ML on large-scale cloud infrastructures. Accordingly, the chapter identifies two potential directions for future work on the sociology of financial machine learning: a “horizontal” expansion to account for the ways machine learning is being used across financial institutions, and a “vertical” deepening that investigates the infrastructures upon which ML systems are developed and deployed, and how they are shaping financial institutions and markets.