The End of Capitalism, Again? An institutional-evolutionary view
The Global Financial Crisis of 2008 was the most severe since 1929. In the years that followed, a major debate on the future of global capitalism emerged. Within this debate a number of studies have argued that the crisis is a symptom of a deeper structural decline. This 'capitalism is ending' argument is derived from analysis focussed exclusively on the developmental contradictions of the capitalist system. Against that approach, I argue that institutional regulation plays a central role in managing capitalist development, and thus adequate analysis must include contradictions and institutional regulation. In this thesis I use institutional-evolutionary theory to critically assess the limitations of key arguments in the debate on capitalism's future. Institutional-evolutionary theory is based on a contemporary revival of Thorstein Veblen's work. I argue the theory contains the resources for investigating the historical specificity of capitalism. Following critique of existing debates on the future of capitalismpost-2008, I develop an original analysis of the evolution of bank bailout policy since the 18th century. This policy was crucial to avert systemic risk in 2008, as well as in many previous crises. In this thesis, I argue that the global diffusion of bailout policy is a case of Darwinian institutional evolution, involving a process of variation, selection, and retention of institutions. Furthermore, I argue that bailout policy is a case of evolutionary sub-optimal lock-in. This finding has implications for banking regulation, and the political economy of future banking crises. Understanding the future of capitalism requires knowledge of its institutional logic, how this generates a specific historical trajectory, and the possibilities and limits of agency to regulate this pattern of development in desired ways. In this thesis I address each of these elements, and in doing so contribute to knowledge of capitalism as an evolving social system.
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