Finance has become more a problem than a solution to what the world most wants: socially inclusive growth. It has become a source of crises that threaten the development of the real economy. It has escaped accountability to democratic institutions and often helped, instead, to influence and corrupt them. Its potential to contribute to broad-based opportunity-expanding growth has been largely and massively squandered.
In this piece I seek to understand not only how this failure manifests itself in some of the major countries and regions of the world, but also, how it can be corrected.
The intellectual and policy response to the crisis in its American and European epicenters has almost entirely suppressed discussion of two themes of immense importance: the link between redistribution and recovery and the connection of finance to the real economy. My analysis recovers these suppressed themes by relating them to a third theme: the deficit of democratic accountability that lies at the root of many of these problems.
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