Micro-level Determinants of Credit Booms and Crashes: Spanish Savings Banks
Tod Van Gunten
Scholars across the social sciences are interested in the causes and consequences of the global financial crisis which began in 2007 and continues today. Spain was a key participant in the boom-bust housing cycle at the core of the crisis and has faced a deep depression since the crash. However, the dynamics of the Spanish crisis remain understudied and imperfectly understood. Moreover, existing research has addressed the crisis primarily from an economic standpoint. While this research has illuminated many of the macro-dynamics of the crisis, sociological and political perspectives at the micro level have not been fully developed. This project examines the causes of the Spanish financial crisis from a sociological perspective, testing theories from economic, organizational and political sociology. It does this by assessing the role of a diffusion process among competing savings banks in generating excessive credit expansion. Exploiting variation across the savings bank sector (cajas de ahorro), this research asks why some savings banks survived the crisis comparatively well, while the remainder of the sector collapsed around them. Project duration: October 2015 to September 2017.