Risk entanglement and the social relationality of risk

The paper addresses how risk should be understood not only as observer-dependent cognitive relations between risk objects and objects at risk but also as constituting social relations between actors. Building on cultural and interpretive perspectives on risk and the relational theory of risk (RTR), the authors propose that risk links actors to one another through their risk assessments and practices. They introduce the concepts of risk entanglement—actors becoming related through their constructions of risk—and risk reciprocity—mutual construction of each other as risk objects. The study argues this extension is crucial for understanding interdependencies across social fields (e.g., politics and finance) and for informing policy and organizational decision-making. Empirically, they explore these dynamics in the German finance-state nexus.

The paper reviews cultural theory of risk (Douglas, Wildavsky) and its grid/group typology, which posits that institutions and culture shape attention to and perception of risks. Empirical tests of cultural theory showed limited support, prompting a turn toward the social construction of risk objects (Hilgartner)—how hazards are framed through discourse and sociotechnical practices. Boholm and Corvellec’s Relational Theory of Risk (RTR) integrates risk objects, objects at risk, and their observer-dependent relations, emphasizing narrative probability, causal reasoning, and agency in linking hazards to valued goods. RTR treats these as socially shared cognitive representations constructed in discourse. The authors argue RTR underemphasizes observer-independent social relations that arise from these constructions. Drawing on relational sociology and practice theory (Bourdieu), they propose extending RTR to include how risk practices manifest in and organize social relations among actors, organizations, and fields, including networked and multi-actor constellations. Illustrative examples (e.g., infrastructure projects; COVID-19 politics-business interactions) motivate the need to theorize risk entanglement and reciprocity.

Design: Qualitative, interpretive study informed by Grounded Theory Methodology to reconstruct risk practices and relations within and between the state and financial fields in Germany. Data collection: 68 narrative, problem-centered interviews conducted between 2017 and 2020, complemented by ethnographic observation of public and closed sessions of the Finance Committee of the German Bundestag over one year. Sampling: - Finance (n=25): actors from private, cooperative, and public savings banks, and insurance companies; roles in risk management, bond trading, derivatives, quantitative engineering/research. - Politics and government (n=26): federal and state-level legislators (budget and finance committees), addressing financial regulation, debt management, and fiscal policy; occasional contrasts with environmental/cultural affairs. - State executive/regulatory (n=17): regulators and supervisors (e.g., BaFin), Deutsche Bundesbank staff, and treasurers responsible for issuing government bonds. Rationale: Comparative approach across the two Strategic Action Fields (state and finance) to capture interdependencies, mutual attributions, and joint or interlaced practices; same acquisition and analysis principles used across fields. Analysis: Transcription of interviews and field notes; coding and constant comparison using Maxqda in line with Grounded Theory to identify constructions of risk objects/objects at risk, risk practices, and emergent patterns of risk entanglement and reciprocity.

• Conceptual advancement: Empirical evidence supports extending RTR to include observer-independent social relations shaped by risk practices. Risk becomes an organizing force of relationality among actors, not just a cognitive linkage between objects. - Regulation dilemma and risk reciprocity: The finance-state nexus exhibits mutual constructions of each other as risk objects with distinct objects at risk, forming dyadic and networked risk entanglements. - State field objects at risk: For politicians—political power, mandates, voter support; for regulators—effective regulation/supervision and state executive power; broader objects at risk include public finance and macroeconomic stability. - Financial field objects at risk: Liquidity and profit margins, market participation, risk portfolios, and customer relations. - Reciprocity 1: Regulation as a risk object for banks ↔ Non-compliance as a risk object for regulators. Regulators adopt proportional and dialogical supervision, creating uncertainty and audit risk for banks (e.g., duplication of risk management to satisfy supervisory expectations). Regulators face the risk of missing non-compliance due to complexity (“somebody always slips through the cracks”). - Reciprocity 2: Unintended consequences as a risk object for politicians ↔ Over-regulation as a risk object for banks. Politicians seek to minimize systemic risk while maintaining financial sector functionality; interventions in complex systems risk generating consequential risks (“shotgun in the fog” metaphor) and catalyzing circumvention strategies. Banks experience restrictions and compliance burdens as threats to profitability and operations, and anticipate curtailment/deregulation due to the state’s liquidity dependence. - Networked entanglement: Beyond dyads (politicians–banks; regulators–banks), multiple actors (e.g., public health authorities, city officials) can share risk objects but have distinct objects at risk, forming broader networks of entanglement. - Practice-level transformations: Fear of supervisory sanction disciplines behavior; banks manage “audit risk” alongside market risks; politicians balance breadth and proportionality of rules; all parties adapt practices in anticipation of each other’s actions, evidencing double contingency. Overall, the findings demonstrate that risk assessments materially structure relations and practices across the finance-state nexus, altering field logics and dependencies.

The findings show that constructions of risk objects and objects at risk translate into concrete social relations and practices among actors across fields. This substantiates the proposed extension of RTR: risk is relational both cognitively and socially. The regulation dilemma exemplifies double contingency and risk reciprocity, where each side anticipates the other’s expectations and behaviors, leading to enduring, institutionalized risk relations (e.g., dialogical supervision, banks’ audit-risk management, legislative trade-offs). Risk entanglement can be dyadic or networked, linking multiple actors around shared risk objects while maintaining distinct objects at risk. These dynamics suggest risk operates as an ordering principle in fields, shaping power, roles, and routines. For policy and organizational practice, recognizing entanglement can help design regulations that mitigate unintended consequences, calibrate proportionality, and account for strategic responses (e.g., circumvention). The analysis also aligns with relational sociology’s view that actors are constituted through relations, as risk entanglements continuously make and re-make actors and field logics.

The paper advances the relational theory of risk by introducing risk entanglement—actors becoming socially related through their risk assessments—and risk reciprocity—mutual construction of one another as risk objects. Using qualitative data from the German finance-state nexus, the authors show how regulators, politicians, and financial institutions threaten each other’s core objects at risk (power, effective supervision, profitable payments), generating stable patterns of risk relations and practice adaptations. The contribution reframes risk as an organizing force of social relationality. Future research directions proposed include: (1) examining entanglement across levels of collectivity (individuals to fields); (2) the role of institutionalization in shaping field-specific risk practices; (3) mapping networked entanglements horizontally and vertically (including forbidden-triad-like constellations); (4) analyzing degrees of interlacing (immediacy, directness, holes/bridges, synchronous/asynchronous ties); and (5) studying temporal evolution of entanglements as relations, institutions, and networks change.