Forschung der Professur Globale Wirtschaftsgeschichte

The Janus Head of Capitalism. Sovereign Debt as a Norm and Point of Crisis after 1945

Laura Rischbieter teaches and writes about modern economic history in a global context. Her research areas include the history of capitalism, international trade, consumer societies, and the history of sovereign debt markets.

Her current research project, entitled The Janus head of capitalism. Sovereign debt as a norm and point of crisis after 1945, focuses on economic crises triggered by illiquidity of states. However, the objects of inquiry are first the expectations and concepts, on which the contemporaries tried to reorganize the global economy, secondly the conflicts around their normative and power-political arrangement and thirdly the attempts of the international financial players to handle the economic consequences. Thus, sovereign debt and individual debt crises will not merely be analyzed as the result of macroeconomic constraints or exceptional social and economic events, but will be conceptualized as a history of economic thoughts, political decisions, power relations, and social repercussions.

DFG Forschungsprojekt (Förderlaufzeit 2016-2019) im Rahmen des Schwerpunktprogramms «Erfahrung und Erwartung. Historische Grundlagen ökonomischen Handelns»

Limited by Myopia? Economic Uncertainty and the International Regulation of Sovereign Debt in Times of Crisis (1970-1997)

Financial crises, like all crises, produce situations that demand forward-looking decisions. The September 2008 decision to let Lehman Brothers fail, for example, is now widely seen as the start of an international crisis of trust in the financial industry. From today’s perspective this political decision of the regulators may seem shortsighted. Those responsible (apparently) expect a very different outcome, but their analysis and decisions were limited by myopia. On what basis did the regulators form the expectations that led to their decision?

This project investigates how assumptions about uncertain economic situations develop, shape expectations about the future, and influence decisions. Taking the case of international financial organizations (IFOs) it will investigate their approaches to crises of sovereign debt. Between the end of Bretton Woods (1971-73) and the Asian crisis of 1997-1998 there were 58 instances of default. As lender of last resort (IMF and the Bank for International Settlements), and agent of debt restructuring (Paris Club), de facto setter of standards (Clubs and Think Tanks), IFOs have played critical roles in such crises. Taking the perspective of international finance organizations and their approaches to sovereign debt crises the project design not only allows individual decisions to be analyzed as historically contingent cases but also permits an investigation of the ways in which the expectations of the actors involved in financial crises changed over time.

Economic sociology, hermeneutics and the sociology of knowledge will provide theoretical approaches for understanding the relationship between expectation formation, crises, and social learning. Case studies of foreign debt crises will be used to demonstrate and explain long-term developments but also breaches in expectation formation.

Ricardo Neuner