ABSTRACT

Instabilities and inequities, as can be related to the widening spread of financialization in different parts of the world economy, make it relevant to further analyse the origin and implications of the related changes brought in by financialization. The all-encompassing nature of a financialized economy, as described in this volume, is marked by the prevalence of financial assets which offer returns at levels higher than those on similar assets which are backed by real activities. While linked to the risks as perceived, the higher returns on investments in those assets provide an impetus to agents in markets to hold them as a greater proportion of their respective portfolios.