Financial and Economic Crisis: Theoretical Explanations of the Global Sunset

 

Patrick Bernhagen** and Raj Chari*

** University of Aberdeen, Scotland (author for correspondence)

* Trinity College Dublin, Ireland

 

Abstract: We identify and examine the most promising political science theories for explaining the financial and economic crisis that started in 2007. Surveying the literatures on lobbying elite integration, ideological hegemony, structural state dependence, and varieties of capitalism, we identify the potential contributions of these different theoretical perspectives to our understanding of the causes of the current crisis specifically, and of the factors driving policymaking and macroeconomic management decisions more generally. We conclude by arguing that these different theories are not mutually exclusive while highlighting the utility of approaches focusing on elite integration, lobbying, and structural dominance for making sense of the crisis in Ireland and elsewhere.