When Lehman Brothers declared bankruptcy in 2008, it brought the international financial system to the edge of collapse. Ten years later, the global economy has recovered but is it really "safer, simpler and fairer"?
UNCTAD Summer School 2018 - Money, Finance and Debt: Old debates, new challenges, was held in Geneva from 3-7 September 2018. The event brought together academics, policy experts and young scholars from 25 countries -- a mix that lead to varying view points and a diverse conversation on globalization and the management of its consequences for developing countries.
The UNCTAD Virtual Institute (Vi) was there to capture it all, as well as conduct one-on-one interviews with various experts. Here are some highlights.
Have policymakers fixed the fault lines that caused the financial crisis?
Professor Gary Dymski of Leeds University (U.K.) was skeptical of claims of today's "safer, simpler, and fairer financial structure"
Richard Kozul-Wright of UNCTAD offered a fascinating take on the evolution of financial markets.
and discussed what has changed since 2008.
Why has the promised transformation of finance not materialized?
Dr. Kozul-Wright also gave three reasons for why reforms have been limited, and why developing countries are more exposed now to systemic risks.
Indeed, said Professor Dymski, the inadequacy of financial reforms appears to have contributed significantly to emerging crises in Argentina and Turkey.
The Vi also caught up with Professor Daniela Gabor of the University of the West of England. "Shadow banking" played a big role in the 2008 crisis, Gabor noted; unfortunately, it continues to flourish today under a new name "market-based-finance."
Ms. Gabor offered her analysis of the global policy response to the crisis,
warned of the risks that shadow banking poses to developing countries
and suggested an alternative global structure to finance development
Another distinguished speaker at the summer school was Professor David Hall of the University of Greenwich (U.K.). Mr. Hall expressed his disillusionment with "public-private partnerships" (PPPs), which, he contended, are part of a misguided neoliberal economic agenda. Hall explained PPPs broadly.
He elaborated on how PPPs relate specifically to developing countries
questioned the effectiveness of PPPs,
and proposed other options for developing countries with fiscal constraints.
How can finance be made more inclusive?
This was yet another question that stirred debate at the summer school.
UNCTAD's Penelope Hawkins discussed the kinds of policies that are needed if the financial sector is to better serve society's poor and marginalized.
The Vi also sat down with some younger scholars to hear what they learned at the summer school, as well as how they plan to use the insights in their own work.
Francisco Perez, graduate student, University of Massachusetts, Amherst
Nathalie Marins, graduate student, The University of Campinas (UNICAMP)
Devika Dutt, graduate student, University of Massachusetts, Amherst
Grygoriy Pustovit, graduate student, Goethe University Frankfurt and Research Center SAFE