
Contents
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6.1 Why States Bank on Markets, and What Happens When They Do 6.1 Why States Bank on Markets, and What Happens When They Do
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6.2 Beyond Europe 6.2 Beyond Europe
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6.3 Conclusion 6.3 Conclusion
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6 Conclusion: Ceding Autonomy but Limiting Costs: Revisiting the Logic of National Bank Control
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Published:August 2017
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Abstract
The study’s findings from Europe have implications for other major powers, including that: (1) banking sector protectionism became increasingly costly given other liberalizing trends; (2) foreign-owned bank subsidiaries can provide more stable funding in crises than alternative foreign or even domestic bank activity; (3) foreign domination in finance limited catching up in the global economy, but in fact few states showed the capacity to exploit domestic banks for national goals; and (4) centralized bank governance through European Banking Union weakened bank–state ties in Europe, and elevated the role of markets there. This chapter analyzes the relevance of the findings for the BRICS (Brazil, Russia, India, China, and South Africa). China is perhaps the clearest case of a country struggling to both liberalize and retain the economic policy autonomy associated with a largely state-controlled financial system. The conclusion specifies the broader transformation in bank–state ties, but also its limits.
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