Finance and Systemic Risk
While finance has garnered increasing attention within political theory, scholars have primarily focused on specific aspects, such as the relationship between financial markets and justice, freedom, and financial regulation, as well as the interplay between democratic principles and central banking.
However, existing scholarship often treats financial risk and systemic risk in isolation from broader structural shifts within democractic governance. DERISK aims to fill this gap by exploring how systemic financial risk reshapes democratic risk-sharing mechanisms and leveraging these insights to develop a normative framework for more inclusive and democratic management of systemic financial risk.
At the heart of this endeavor lies an exploration of how political institutions, notably central banks, wield increasing influence in governing systemic risk within financial sectors. In the European Union, the contagion of systemic risks across sovereign debt markets has spurred the emergence of novel political mechanisms operating outside traditional treaty frameworks.
DERISK seeks to unpack the implications of these developments, providing a new normative basis for state regulation of systemic financial risk grounded in the preservation of political equality. Building upon this foundation, the project aims to propose a model for democratising systemic risk governance within central banking, challenging the prevailing dichotomy between independence and politicisation.
By offering novel insights into the evolving role of political institutions in managing financial risks and proposing innovative approaches to democratizing systemic risk governance, DERISK contributes to a more comprehensive understanding of the complex dynamics shaping contemporary democracies in the face of financial challenges.
