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Finance and the Financialization of Capitalism

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Capitalism, Democracy, Socialism: Critical Debates

Part of the book series: Philosophy and Politics - Critical Explorations ((PPCE,volume 22))

Abstract

This chapter provides an overview of recent debates about the financialization of capitalism and examines the implications of financialization for critical social theory, broadly understood. Financialization refers to the increasing importance of financial products, actors, and markets in contemporary society. The chapter begins with a discussion of the financialization of capitalism. It then turns to explore how the predominance of finance within capitalism alters social and political relationships throughout society. The chapter first discusses the financialization of the household and the rise of an asset-based welfare system, which reveal the disparate gendered implications of financialization, and then the historical role of race in structuring the development of finance and the racialized implications of financialization, especially in the context of the United States. The chapter then examines financialization from the perspective of theories of culture and subjectivity. The last portions of the chapter turn to the political consequences of finance: for democracy and the state, and then for ecological politics and the possibilities of averting catastrophic climate change. In both cases, the financialization of capitalism accelerates the forces hollowing out contemporary democracy and generating ecological crises. The chapter concludes with a brief discussion of political alternatives to the current organization of financialized capitalism as well as directions for future research.

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Notes

  1. 1.

    For an up-to-date overview of all research into financialization, readers are encouraged to consult the Routledge International Handbook of Financialization (Mader et al. 2020).

  2. 2.

    While finance and credit systems are deeply interwoven in capitalist societies, finance refers to the peculiar commodification of the risk involved in the extension of credit to individuals, businesses, and so on, where financial markets resell risk in order to ensure the profitability of their operations.

  3. 3.

    Brassett and Rethel (2015) extend this idea of oikonomia further to interrogate how the hetero-normative gender stereotypes of the self-sufficient household underpin the political narratives of domesticating global finance after 2008.

  4. 4.

    As has been widely discussed in debates on the financial subject within literary studies. For instance: Sherman 1996; LaBerge 2015; Roxburgh 2016; McClanahan 2017.

  5. 5.

    See Wang (2018a, b) and Vishmidt (2020).

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Author information

Authors and Affiliations

  1. Department of Political Science, University of Wisconsin, Milwaukee, Milwaukee, USA

    Ivan Ascher

  2. Department of Media, Journalism & Film, Miami University, Oxford, USA

    Carolyn Hardin

  3. Department of Political Economy, King’s College London, London, UK

    Steven Klein

  4. Department of European and International Studies, King’s College London, London, UK

    Johnna Montgomerie

  5. Department of Visual Cultures, Goldsmiths, University of London, London, UK

    Emily Rosamond

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  1. Ivan Ascher
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Correspondence to Steven Klein .

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  1. Brussels School of International Studies, University of Kent, Brussels, Belgium

    Albena Azmanova

  2. Department of Political Science and Public Administration, Mississippi State University, Mississippi State, MS, USA

    James Chamberlain

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Ascher, I., Hardin, C., Klein, S., Montgomerie, J., Rosamond, E. (2022). Finance and the Financialization of Capitalism. In: Azmanova, A., Chamberlain, J. (eds) Capitalism, Democracy, Socialism: Critical Debates. Philosophy and Politics - Critical Explorations, vol 22. Springer, Cham. https://doi.org/10.1007/978-3-031-08407-2_4

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