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East Asia and the politics of global finance: a developmental challenge to the neoliberal consensus?

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  • Pape, Fabian
  • Petry, Johannes

Abstract

Recent IPE scholarship locates the key dynamics of financial globalization in two areas: public money flows between the US and Asia, or private banking flows between the US and Europe. This dichotomy presents the globalization of private finance as firmly anchored within transatlantic, neoliberal financial norms. We argue that this creates a blind spot regarding the growing role of East Asian finance within the global financial system. Combining CPE insights on institutional characteristics of Asian financial systems with a macro-financial analysis of the global financial system, this paper analyzes the global implications of the geographic shift towards East Asia. First, we demonstrate the growing importance of East Asia for global macro-financial flows, actors and markets that goes beyond the rise of China. Second, we explore how the institutional arrangements that underpin Asian financial systems differ significantly from transatlantic finance. By investigating the growing importance of global investors in Asian markets and Asian investors in global markets, we explore how the shift towards East Asia introduces a growing role of developmental characteristics within global finance. This calls for a reconsideration of conventional analyses of the global financial system which often assume its role as a force of neoliberal globalization.

Suggested Citation

  • Pape, Fabian & Petry, Johannes, 2023. "East Asia and the politics of global finance: a developmental challenge to the neoliberal consensus?," LSE Research Online Documents on Economics 118296, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:118296
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    File URL: http://eprints.lse.ac.uk/118296/
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    References listed on IDEAS

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    Cited by:

    1. Fichtner, Jan & Petry, Johannes, 2024. "Global Finance: changing practices, actors, and geographies," SocArXiv asx7t_v1, Center for Open Science.
    2. Daniela Gabor & Ndongo Samba Sylla, 2023. "Derisking Developmentalism: A Tale of Green Hydrogen," Development and Change, International Institute of Social Studies, vol. 54(5), pages 1169-1196, September.
    3. Fichtner, Jan & Petry, Johannes, 2024. "Global Finance: changing practices, actors, and geographies," SocArXiv asx7t, Center for Open Science.

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    More about this item

    Keywords

    comparative political economy; East Asia; global financial system; international political economy; comparative capitalism; developmentalism; global finance; macro-finance; neoliberalism; post-crisis; Warwick T&F agreement;
    All these keywords.

    JEL classification:

    • F3 - International Economics - - International Finance
    • G3 - Financial Economics - - Corporate Finance and Governance
    • J1 - Labor and Demographic Economics - - Demographic Economics

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