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The causes for the formation of a bubble in the collateral market when agents are provided with homogeneous expectations are explored. This bubbly dynamics will define a sufficient condition for deleveraging.

Theoretical approach with neutral deleveraging.

Findings of the study are defined sufficient conditions for a behavioral rational bubble's formation in a market of collateral and the subsequent deleveraging. The crowd-in effect of the representative bubble is caused by errors in extrapolating information and thus by representativeness, while the crowd-out effect of deleveraging is set off by reverting to a rational heuristic.

The limit is that it is a homogeneous expectations approach, the implication is that cannot be rational speculation.

Even in a simple model of homogeneous expectations a bubble may arise with serious effect on the demand side: models that detect just rational mispricings cannot account for behavioral components that have financial and real effects.

The paper defines how deleveraging may occur even in case of homogeneous expectations. The latter should not be seen just as a limit but also as a signal of the importance of being aware of behavioral components.

Affect is relevant for organization studies mainly for its potential to reveal the intensities and forces of everyday organizational experiences that may pass unnoticed or pass in silence because they have been discarded from the orthodoxy of doing research “as usual.” The paper is constructed around two questions: what does affect “do” in a situated practice, and what does the study of affect contribute to practice-based studies. This paper aims to discuss these issues.

The authors chose a situated practice – interviewing – focusing on the dynamic character of the intra-actions among its heterogeneous elements. What happens to us, as persons and researchers, when we put ourselves inside the practices we study? The authors tracked the sociomaterial traces left by affect in the transcript of the interviews, in the sounds of the voices, in the body of the interviewers, and in the collective memories, separating and mixing them like in a mixing console.

The reconstruction, in a non-representational text, of two episodes related to a work accident makes visible and communicable how affect circulates within a situated practice, and how it stiches all the practice elements together. The two episodes point to different aspects of the agency of affect: the first performs the resonance of boundaryless bodies, and the second performs the transformative power of affect in changing a situation.

The turn to affect and the turn to practice have in a common interest in the body, and together they contribute to re-opening the discussion on embodiment, embodied knowledge, and epistemic practices. Moreover, we suggest an inventive methodology for studying and writing affect in organization studies.