Financial Liberalization and the Reconstruction of State-Market Relations

This study examines the causes and political consquences of financial liberalization in the advanced industrial states. Tracing the interaction between domestic political choices and the structure of the financial regime, the author argues that the ability of financial asset-holders to hedge political risk through portfolio diversification systematically constrains state behavior by rewarding some actions and punishing others. "Structural" phenomena are thus the activities of non-state actors who operate transnationally. In addressing the political influence of financial asset-holders, this study challenges traditional state-centric explanations for policy choice. This work will be of interest to political scientists, economists, and scholars studying international political economy.