Distinguishing Financialization from Neoliberalism

This article contends that neoliberalism and financialization, although sharing much in common, are not synonymous developments. Not only do strongly financialized nations display structural, economic differences, they are also directed by alternative economic epistemologies, cultures and practices. The argument is made by examining the financialization of the UK economy since the mid-1970s. This shift was not simply part of a broad transition away from Keynesianism and towards free market fundamentalism. It was also one very much guided by the particular economic paradigm, discursive practices and devices of the City of London as financial elites took up influential positions in the Thatcher government. The discussion and case example highlight five epistemological elements specific to finance: the creation of money in financial markets, the transactional focus of finance, the centrality of financial markets to economic management, the orthodoxy of shareholder value, and the intense microeconomic approach to financial calculation. Such elements, in conjuction with neoliberalism’s reliance upon finance-blind neoclassical economics, lies at the cultural and epistemological distinction between fiancialization and neoliberalism. Identifying such distinctions opens up new possibilities for understanding financialization, elites, and the neoliberal condition that brought about the financial crash of 2007-08, as well as the political and economic crises that have followed

The end of mass homeownership? Changes in labour markets and housing tenure opportunities across Europe

With continued economic growth and expanding mortgage markets, until recently the pattern across advanced economies was of growing homeownership sectors. The Great Financial Crisis (GFC) has however, undercut this growth resulting in the contraction of homeownership access in many countries and the revival of private renting. This paper argues that these tenure changes are not solely a consequence of the GFC, and therefore, reversible once long-term growth returns. Rather, they are the consequences of more fundamental changes especially in labour markets. The very financialisation that fuelled the growth of homeownership has also led to a hollowing out of well-paid, secure jobs—exactly those that fit best with the taking of housing loans. We examine longer-term declines in labour market security across Europe from before the GFC, identifying an underlying correlation between deteriorated labour market conditions and homeownership access for young adults. While variations exist across European countries, there is evidence of common trends. We argue that the GFC both accelerated pre-existing labour insecurity dynamics and brought an end to offsetting such dynamics through the expansion of credit access with the likelihood of a return to an era of widespread homeownership growth starkly decreased