Introduction: Towards a Political Economy of Banking

In this introductory chapter we first review the standard bank–credit/capital markets dichotomy used to describe national financial systems. We examine the influence of this dichotomy in the comparative political economy (CPE) literature, which is the disciplinary focus of most of the contributors to this volume. We explain how effectively scholars of the political economy of finance explain the phenomenon of change and then briefly describe the market-based banking model in the context of the broader national financial systems. In the penultimate section, we consider the impact of market-based banking on the domestic political economy and the impact of the international financial crisis.