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 Research Projects at the MPIfG

Towards a Political Economy of Financialized Growth

Puneet Bhasin


 
The post-Bretton Woods/post-Keynesian era is marked by the rise of modern globalized finance, which has resulted in the “financialization” of industrially advanced economies to varying degrees. This project aims to conceptualize the changing political economy of industrially advanced nation-states in which the process of financialization has entailed economic growth, but with rising income and wealth inequality that now threatens existent democratic structures. Towards this end, the project advances the concept of financialized growth as implying a surge in credit-induced consumption and diversion of pecuniary gains from complex financial activities as investments mainly in capital-intensive, high-risk, but potentially high-return ventures for owners of financial assets. By tracing historically skewed distributions of underlying financial assets, it seeks to show how inequality is endogenous to the process of financialized growth and how interest group politics and industrial relations enable or restrain it. The project uses an inductive approach, with the United States, the United Kingdom, Germany, France, and Sweden serving as primary cases for analyzing the politics of varying levels of financialized growth since the 1980s. Project duration: October 2019 to March 2022.
 

 
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