Financial crises over the last decades have shaken the United States and the European Union to their core. And yet, prevailing wisdom suggests that these have been status quo crises in terms of the regulation of finance, evoking only incremental, if any change. This work contradicts these conclusions and claims that they are premature and ignore the different temporalities that underlie paradigmatic change, moving from a new vision of finance as cyclical to its transformation into policy devices to their final use in applied policy making. Opening up the blackbox of ideational change, this book argues that fundamental changes in the economic analysis of finance have occurred during the last decade, feeding into the construction of policy devices. They allow regulators to measure and regulate systemic risks, coming online only in the second half of the 2010s. This work therefore seeks to better understand this longer-term trajectory of change in economic ideas, their translation into policy devices and the political-institutional factors conditioning their use. Innovatively combining micro-level research on regulatory science and the sociology of economics with historical and discursive institutionalists’ analyses of institutional change on the macro-level, this book examines the pathways of these regulatory ideas from economics into bureaucratic space into politics. Based on expert interviews, qualitative as well as quantitative document analysis, the proposed multi-dimensional approach to policy paradigm shifts highlights the role of applied economists in central banks and their impact on economics and the regulation of finance.
About the speaker:
Matthias Thiemann is Associate Professor of European Public Policy at Sciences Po's Center for European studies. His research focuses on financial regulation, particularly macroprudential regulation post-crisis, its ideational underpinnings as well as its actual effects and the work of public development banks in Europe. His work has been published inter alia in the American Journal of Sociology, Journal of European Public Policy, Review of International Political Economy, New Political Economy and Regulation and Governance. In 2018, he published a monograph on the regulation of shadow banking with Cambridge University Press. He is currently preparing a second monograph on Minskyian ideas and post-crisis financial regulation.