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Understanding financialization: standing on the shoulders of Minsky

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  • Whalen Charles J.

Abstract

Since Hyman Minsky’s death in 1996, much has been written about financialization. This article — by means of the synthesis, interpretation, and assessment of an extensive literature — explores the issues that Minsky examined in the last decade of his life and considers their relationship to the financialization literature. At the heart of those issues is what Minsky called money manager capitalism, which he viewed through the lens of a theory of capitalist development inherited from Joseph Schumpeter. Advancing our understanding of the history of financial economics, the article shows how Minsky contributed to — indeed, anticipated much of — the study of financialization. The article also identifies two sources of Minsky’s insightfulness: his treatment of economics as a grand adventure, and his willingness to step beyond the world of theory and interact with the world of practice. Today, scholars with a Minsky perspective face formidable challenges, but, the author concludes, within Minsky’s writings is also a glimmer of hope: Economic systems are not natural systems; we can reshape them to achieve a more humane world.

Suggested Citation

  • Whalen Charles J., 2017. "Understanding financialization: standing on the shoulders of Minsky," Financial Internet Quarterly (formerly e-Finanse), Sciendo, vol. 13(2), pages 45-61, December.
    • Handle: RePEc:vrs:finiqu:v:13:y:2017:i:2:p:45-61:n:5
    DOI: 10.1515/fiqf-2016-0022
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    References listed on IDEAS

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    1. David A. Zalewski, 2002. "Retirement Insecurity in the Age of Money-Manager Capitalism," Journal of Economic Issues, Taylor & Francis Journals, vol. 36(2), pages 349-356, June.
    2. Charles J. Whalen, 2017. "Understanding Financialization: Standing on the Shoulders of Minsky," Economics Working Paper Archive wp_892, Levy Economics Institute.
    3. Luigi Ventimiglia & Daniela Tavasci, 2010. "Money Manager Capitalism in Primary Commodity-Dependent Developing Countries," Palgrave Macmillan Books, in: Daniela Tavasci & Jan Toporowski (ed.), Minsky, Crisis and Development, chapter 10, pages 168-187, Palgrave Macmillan.
    4. Thomas I. Palley, 2013. "Financialization: What It Is and Why It Matters," Palgrave Macmillan Books, in: Financialization, chapter 2, pages 17-40, Palgrave Macmillan.
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    More about this item

    Keywords

    Hyman Minsky; money manager capitalism; financialization;
    All these keywords.

    JEL classification:

    • B26 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Financial Economics

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