Have we been here before? Phases of financialization within the twentieth century in the US

Abstract

This paper explores the process of financialization from a historical perspective during the course of the twentieth century. We identify four phases of financialization: the first from the 1900s to 1933 (early financialization), the second from 1933 to 1940 (transitory phase), the third between 1945 and 1973 (de-financialization), and the fourth period picks up from the early 1970s and leads to the Great Recession (complex financialization). Our findings indicate that the main features of the current phase of financialization were already in place in the first period. We closely examine institutions within these distinct financial regimes and focus on the relative size of the financial sector, the respective regulation regime of each period, the intensity of the shareholder value orientation, as well as the level of financial innovations implemented. Although financialization is a recent term, the process is far from novel. We conclude that its effects can be studied better with reference to economic history.

Have commodities become a financial asset? Evidence from ten years of Financialization

“…However, we also find that commodities have recently entered into a period of de-financialization during which the dominance of financial variables appears to have extenuated. This finding is in line with the general financialization literature which reports that financialization has gone through several cycles over the last 100 years (Fasianos et al, 2018). Although it is presently too early to know with certainty, anecdotal evidence from the industry suggests that demand for commodity derivatives has been rising again since 2018 so that the current de-financialization is likely to be a temporary phenomenon rather than a symptom for a return to historical norms.…”

“…In this paper, we investigate the relatively recent financialization of commodity markets. In the general finance literature, the transformation of the economy is measured by the size of the financial sector as a fraction of overall production (see for instance Fasianos et al, 2018). We present a similar approach that examines the fraction of commodity prices that can be explained by financial variables.…”

The efficacy of monetary policy in an age of financialisation and climate change

“…The past four decades and more have been characterised as an era of intense financialisation. This was not the first era of financialisation (Vercelli, 2013, Fasianos et al, 2018. The present era of financialisation has its own specific characteristics, which impact on the economy and society, though the focus here is on implications for monetary policy.…”

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

“…Note, though, that, despite being a substantive critic,Christophers (2018) finds it convenient to deploy the term in his account of land privatisation in the UK! SeeFasianos et al (2018) for the historical comings and goings of finn.11 See also for similar for emerging economies. Perversely, although they write of such variegation primarily from a post Keynesian perspective, that approach has tended to reduce finn to…”