Financialisation of Households
One of the key aspects of financialisation has been a growing involvement of households in the circuits of finance. In particular, the issue of household indebtedness has been highlighted by many commentators as an important aspect of financialisation, with profound implications for households themselves and for a wider macro-economy. It is clear that financialisation has indeed dramatically accelerated the enrolment of households into debt-related instruments (e.g. via mortgages, credit cards and other means). Nowhere is this more evident than in East-Central Europe, which saw a dramatic increase of household debt since the collapse of state-socialism, coinciding with the increased financialisation of states and financialisation of banks operating in the region.
Yet, the extent and the way in which post-socialist societies in East-Central Europe are linked to the process of financialisation remains under-researched and under-theorised. Importantly, East-Central Europe should not be seen as just another geographical context yet to be examined from the point of view of financialisation. Indeed, GEOFIN’s argument is that the post-socialist context is special – and qualitatively different from any other context – in that the former state-socialist societies were built on the very opposite logic to that of financialisation. The communist project was about creating a society where money would cease to exist – they would not be needed because the caring, collectivist society would cater for everybody’s needs. This contrasts with the increasingly individualistic and competitive financialised capitalism, in which money is (nearly) everything and ‘financialised subjects’ are expected to secure their own ‘financial assets’ to cover their needs or to simply survive. The nature, scale and speed with which members of society had to re-align themselves with the new financial imperatives after the fall of state-socialism are unprecedented. GEOFIN aims to examine the ways in which households in post-socialist East-Central Europe have engaged with the new financial system and how this varies across different geographical settings. In order to do this, GEOFIN aims to explore household financialisation through a number of case studies.