Financialised internationalisation and structural hierarchies: a mixed-method study of exchange rate determination in emerging economies

Abstract

This is a repository copy of Financialised internationalisation and structural hierarchies: a mixed-method study of exchange rate determination in emerging economies.

Costs and benefits of currency internationalisation: theory and the experience of emerging countries

“…In parallel to the literature on currency internationalisation, 1 Post-Keynesian economists have been the pioneers in developing another approach to understand the international demand for currencies -the currency hierarchy literature (Andrade and Prates, 2013;De Paula et al, 2015, 2017Kaltenbrunner, 2015Kaltenbrunner, , 2018Fritz et al, 2018). These authors mostly use Keynes' liquidity premium theory (1936) to characterise the position of a currency in the hierarchy.…”

“…peripheral currencies), which, by definition, are located in the lowest positions of the currency hierarchy. Post-Keynesian economists, who have been more recently contributing to this literature, have emphasised other risks involved in this process, such as exchange rate volatility, loss of monetary policy autonomy and financial fragility (Fritz et al, 2018;Kaltenbrunner, 2018). So the question that needs to be raised is: are we actually 'getting the calculus right', as suggested by Cohen (2012)?…”

From Marxist Political Economy to Financialization or Is It the Other Way About?

“…Rather, the state offers a contested terrain in which the pressures to promote financialisation are as important as the need to play alongside or with it. Nor is this confined to the national stage as the adjustments across peripheral Europe so amply demonstrate, let alone how finnternationalisation is attached to "a structured and hierarchic international monetary system which fundamentally distinguishes exchange rate drivers in emerging economies from those in developed ones", Kaltenbrunner (2018Kaltenbrunner ( , p. 1315, but see below.…”

Steering capital: the growing private authority of index providers in the age of passive asset management

“…We argue that in the age of passive investing this power is partially transferred to index providers as they decide over capital inflows/outflows through inclusions/exclusions. This is especially relevant for emerging economies as financial markets are organized hierarchically and emerging countries bear the brunt of skittish investor behavior (Kaltenbrunner, 2018). The dynamics of this process are changing, however.…”