Simon Mohun, The Relevance of the Financial Crisis

With a return visit to the Department of Political Economy at the University of Sydney, Simon Mohun extends his work on the classical surplus-based tradition in economics. As he writes on his Research in Political Economy home page, “one of the striking features of this tradition has been its difficulty in addressing actual trends of contemporary capitalist development. A common approach has been either to abandon empirical investigation in favour of high theory, or to engage with the empirical world in a theoretically cavalier manner. This context of a divorce between theory and empirical evidence has formed the background to my research”, which will be related in this talk to the financial crisis.

The financial crisis was driven by two separate events: first, a crisis of profitability in conventional banking in the 1980s, resolved by restructuring the banking industry; and, second, by the huge shift in income distribution towards the top (the 1%) over the neoliberal era. The juxtaposition of these two factors explains why the crisis broke out in wholesale money markets, where those with bonds who need cash meet those with cash who need bonds. This remains relevant as little has changed.

Venue: Merewether Seminar Room, 498

Date: Thursday 22 March 4:00 – 5:30 pm