For citation:
Vernikov, A. V., & Kurysheva, A. A. (2024). Theoretical Perspectives on the Financialization of the Economy. AlterEconomics, 21(2), 179–203. https://doi.org/10.31063/AlterEconomics/2024.21-2.2
Abstract:
This paper examines key research approaches that contribute to a critical reevaluation of financialization and its impacts. Financialization is understood as the expansion of the financial sector, its intrusion into social and private life, and the shift of non-financial companies toward financial transactions. This ideology prioritizes financial metrics, often benefiting predominantly financial organizations. Several heterodox approaches challenge the mainstream view that an exaggerated financial sector is favorable for society. These approaches aim to create frameworks for alternative social orders and include institutional, macroeconomic, structural, spatial, sociological, and ethical perspectives addressing the risks of an excessively large financial sector. We particularly emphasize the financialization of households and its negative socio-economic consequences. Our findings indicate that, contrary to expectations, concerns about rampant financialization are more prevalent among sociologists, anthropologists, and psychologists than among economists. Russian researchers still predominantly view the role of finance in economic development as inherently positive. Few, if any, articles address the need for de-financialization, which involves reducing the absolute and relative weight of the financial and banking sectors in the economy and society. De-financialization could contribute to a broader framework to implement independent monetary policy and a strategy for economic sovereignty, including reindustrialization efforts.
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