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Exclusion and Fragility: Across Time and Space

Padmini Swaminathan

Edited by Amiya Kumar Bagchi and Gary A. Dymski
Tulika Books, New Delhi, 2007, pp. 343, Rs. 625.00


This is a breathtaking, densely packed collection of essays on global finance that has as its core the themes of exclusion and fragility. These two themes are addressed across time and space; besides, even as the financial-globalization experiences of Eastern Europe and China provide a comparative perspective, there is a special focus on India’s plunge into global finance post-liberalization. As always, Bagchi’s piece on the ‘Overlooked Historical Context of the Current Period’ is rich in detail and insights apart from setting the context for the exploration of the core questions ‘about imperial legacies and structures of inequality in the contemporary process of financial globalisation’. Among the many important remarks that Bagchi makes is the havoc caused by conventional (mainstream) finance theory that continues to remain insulated from analyses of historical aspects of financial development and/or aspects of the structured inequality that have arisen in global financial relations.   Dymski’s overview of the chapters in the book usefully captures the aspects of continuity and change characterizing global finance and merits an elaborate quote. As he points out, while chronic fiscal crises in peripheral countries remain a feature of the contemporary world economy, these crises have been transformed from what they once were, and differ from those in the past in several ways. ‘First, the pace of investment is now more assuredly in the hands of multinational banks and companies than in the colonial era. Second the locus of crises has shifted… Financial crises that previously would have devastated entire economies, snapped currencies like twigs, and destroyed over-lending banking enterprises, are today largely contained… Instead, the legacy of the crises is a ruined terrain in affected peripheral countries—businesses with decimated balance sheets due to home currency devaluations, bankrupted companies, and suicidal entrepreneurs, reduced wages and unemployment for the workers of the periphery, another ratchet turn of increased global north ownership of the enterprises, energy resources, and nature of the global south, and a grinding growth in the sovereign or private indebtedness of peripheral countries and their economic units’ (p. 22). Despite these adverse fallouts, much contemporary policy advice is built on what Dymski has termed as ‘an ideology of normality’. This ideology supposes, according to Dymski, that any given nation and its agents anywhere in the world face the same opportunities to benefit from undertaking optimal economic policies; and optimal policies are those that would yield welfare maxima under ...

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