The state capture of Russian non-bank financial institutions and markets after the 2008 crisis

Viktorov, Ilja; Abramov, Alexander E.

doi:10.1177/1024529415611267

Cited by 10 publications

(6 citation statements)

References 27 publications

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“…A common result in these analyses is the pervasive role of the Chinese state in creating and shaping capital markets (Collins and Gottwald, 2014;Gruin, 2019;Wang, 2020). In other emerging markets, financialization processes have also been increasingly scrutinized, similarly emphasising the role of the state and the integration of these economies into global finance such as in India (Chandrasekhar and Ghosh, 2018), Korea (Kalinowski and Cho, 2009), Russia (Viktorov andAbramov, 2016), Brazil (de Paula, 2011), South Africa (Bond, 2013) or Senegal and Ghana (Koddenbrock et al, 2020). However, there is an absence of systematic and theory-led cross-country studies on these issues.…”

Section: Finance and State Capitalismmentioning

confidence: 99%

State capitalism and capital markets: Comparing securities exchanges in emerging markets

2021

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Finance plays a major role in discussions about state capitalism in emerging markets, but the focus has so far been on banks. Capital markets have been neglected. Moreover, findings from the growing literature on financialization in emerging markets indicate that in some cases there is increasing state involvement in the development and functioning of capital markets. Hence, the relationship between the state and finance in these economies may be fundamentally different from the picture provided by liberal Western-centric perspectives. Instead of looking at capital markets as uniform entities, we propose to analyse them as variegated – while characterized by common financialization processes, they can be informed by different institutional logics, leading to very different market dynamics and outcomes. We explore to what extent these differences exist and how state-capitalist economies facilitate capital market development. Our comparative institutional analysis of securities exchanges as central parts of capital markets in six increasingly financialized emerging market economies – Brazil, China, India, Russia, South Africa and South Korea – focuses on the degree to which capital markets are integrated into state-capitalist institutions. Instead of mere platforms on which market transactions take place, we analyse exchanges as powerful actors which actively shape capital markets. While in most advanced economies exchanges are situated within an institutional setting informed by neoliberal institutional logic, we demonstrate that exchanges in emerging markets often organize capital markets to facilitate state objectives.

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Section: Finance and State Capitalismmentioning

confidence: 99%

State capitalism and capital markets: Comparing securities exchanges in emerging markets

2021

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“…These empirical examples are important in the context of state capitalism in other countries (Kurlantzick, 2016). Viktorov and Abramov (2016), for instance, explore the Russian state's post-GFC expansion into its financial markets, albeit Russia has been less successful in thereby pursuing its development agenda. The development of local currency bond markets in East Asia through hybrid public-private institutions also points in this direction (Rethel and Sinclair, 2014).…”

Section: Internationalizing China's Capital Markets: Challenging Neoliberal Capital Marketsmentioning

confidence: 99%

Same same, but different: Varieties of capital markets, Chinese state capitalism and the global financial order

Petry

2020

Competition & Change

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Since 2009, China’s capital markets have developed and internationalized to an unprecedented degree, which has contributed to a lot of debates on China’s rise and its implications for the global financial order. Contributing to these debates, this article analyses the development of capital markets in China and their integration into global finance between 2009 and 2019, focusing on three aspects: how Chinese capital markets are developing domestically; how they are integrating with global markets; and how Chinese capital markets are internationalizing, i.e. expanding abroad. Thereby, the article analyses the crucial role of securities exchanges who as organizers of capital markets are powerful actors that exercise considerable influence over these markets and their development. This empirical investigation reveals that while they share some characteristics with ‘global’ capital markets, Chinese capital markets function quite differently. The article argues that China’s state-owned exchanges facilitate the development of state-capitalist capital markets – capital markets that follow an institutional logic derived from China’s state-capitalist economic system. Rather than giving in to a neoliberal rulebook, China’s capital markets represent an alternative to, resist and challenge the norms, principles and procedures of the contemporary global financial order. While different capital markets share some characteristics, they are institutionally embedded, and these institutional settings facilitate different institutional logics that underpin and inform the functioning of markets. Instead of viewing capital markets as homogeneous entities, the article therefore proposes to investigate a ‘varieties of capital markets’ that are shaped by different institutional logics.

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“…Starting in the late 1990s, the Russian state gradually regained ownership of and managerial control over the largest commercial banks and financial flows (Viktorov and Abramov 2016). From the 2000s, a new pattern of relational banking between large state banks and state-controlled extractive industries and defence corporations arose (Vernikov 2014).…”

Section: The Domestic Macroeconomic Policy Regime and The Financialismentioning

confidence: 99%

The 2014–15 Financial Crisis in Russia and the Foundations of Weak Monetary Power Autonomy in the International Political Economy

Viktorov

Abramov

2019

New Political Economy

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This article contributes to international political economy debates about the monetary power autonomy (MPA) of emerging market and developing countries (EMDs). The 2014-15 Russian financial crisis is used as a case study to explore why an accumulation of large international reserves does not provide protection against currency crises and macroeconomic adjustments in EMDs. The analysis centres on the interplay between two dimensions of MPA: the Power to Delay and the Power to Deflect adjustment costs. Two structural factors condition Russia's low MPA. First, the country's subordinated integration in global financial markets increases its financial vulnerability. The composition of external assets and liabilities, combined with cross-border capital flows, restrict the use of international reserves to delay currency crises. Second, the choice of a particular macroeconomic policy regime embraced the financialisation of themainly state-owned-Russian banking sector, thus making it difficult to transform liquidity inflows into credits for enterprises. Russia's main comparative advantage, hydrocarbon export revenues, is not exploited. The type of economy created due to the post-Communist transition means that provided 'excessive' liquidity remains in the financial system and is channelled into currency arbitrage. This factor increases exchange rate vulnerability and undermines Russia's MPA.

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The state capture of Russian non-bank financial institutions and markets after the 2008 crisis

Cited by 10 publications

References 27 publications

State capitalism and capital markets: Comparing securities exchanges in emerging markets

State capitalism and capital markets: Comparing securities exchanges in emerging markets

Same same, but different: Varieties of capital markets, Chinese state capitalism and the global financial order

The 2014–15 Financial Crisis in Russia and the Foundations of Weak Monetary Power Autonomy in the International Political Economy

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