Sociology of Public Finances and Debt
Public finances assume a critical role in capitalist democracies. The strength of democracy partly depends on whether citizens believe that tax burdens are fairly distributed and used effectively to provide public goods. Public finances are equally important for the viability and stability of capitalist economies, where states play an essential role in mitigating unequal market distributions, providing public infrastructure, and serving as critical sources of demand. Relatedly, state debt is one essential building block for money and credit creation, even in today’s expanded and globally integrated financial systems. Over the past twenty years, however, Western states have gradually stepped back from their roles in mitigating inequality via fair taxation and public spending. Despite their essential roles in financial markets, state actors have failed in addressing instabilities and excessive financialization. Fiscal policy and public investments have been neglected as important contributions to macroeconomic stability and public wealth. What explains this reduced capacity of states in using public finances for the general public good? The research group addresses this question from a comparative perspective, conducting studies on local, national, and transnational levels and using quantitative as well as qualitative research strategies.
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