Combining balance sheet analysis with historical institutional analysis, this book traces the evolution of social sector financial balance sheets in the US from 1960 to 2018.
This innovative historical-institutional approach, ranging from the micro level of households to the macro level of the federal government, reveals that the displacement of households by banks has been a long-term process. This gradual compounding of financialization is at odds with widely accepted views about financialization, contemporary banking theory, financial intermediation theory, and post-Keynesian and endogenous money approaches. The book returns to time-tested traditional principles of banking and taps unexpected affinities about market failures in transaction cost economics, financial intermediation theory, and core ideas in classic modern political and social economy about economic moralities and social reactions of self-defense against unfettered markets. This book provides an alternative explanation for the rise of finance and new ways to think about averting financialization and its devastating consequences.
This book marks a significant contribution to the literature on financialization, social economics, banking, and the American political economy.
Table of Contents
1 Compounding financialization, critical pluralist political economy, and historical-institutional balance-sheet analysis
2 Political economy and the financialization of American banking
3 The centralization and financialization of American monetary authority
4 Shadow banking, off-balance sheet activities, and nonbank finance
Kurt Mettenheim taught at the FGV-EAESP in São Paulo, Brazil, the University of Oxford, the University of Pittsburgh, and Columbia University.
"A massive and remarkable achievement. The historical institutional analysis of trends in sectoral balance sheets is backed by endlessly fascinating tables and figures. The central claim about the ideological and real impact of finance is highly relevant to the study of American and comparative political economy. The two volumes provide important insights into patterns of continuity and change in American economics and politics since the financial crisis of 2007-8."
Jeffry Frieden, Harvard University Department of Government