Rethinking the Power of Finance

Rising inequalities have been explained with reference to organized groups and the lobbying of the financial sector. This article argues that political economy studies of finance have either proposed a highly actor-centered perspectives that focus on the agency of political and financial elites, or have espoused a very impersonal structural understanding of change borrowing from Marxist political economy. This article seeks to reconceptualize the power of finance in order to bridge accounts of politics as organized combat and those that analyze how the advantage of finance unfolds as a structural feature of advanced economies over time. Ultimately, the challenge is to explain how the power of finance built up and plays out in creating inequalities with the support of actors that few would accuse of being finance-friendly, such as the European center-left parties and consumers. Re-conceptualizing the power of finance has important implications for political solutions to rising inequalities.