ABSTRACT
After several painful crises in emerging market economies (EMEs) and in some smaller advanced economies in the 1990s, it took a systemic crisis in the heart of global capitalism, the united States economy, for economists finally to recognize (although timidly) the need for questioning their belief in the spontaneous efficient working of free markets and then to ask, “What’s going to save financialized market economies and put capitalist finance on a right path?” Old and forgotten critics came back, through Minsky-like analyses and renewed words, like institutional consistency and macro-prudential regulation, gave old debates new clothes. Indeed, 30 years after the publication of Carlos Diaz-Alejandro’s article – “Goodbye financial repression, hello financial crash” – the balance sheet of financial reforms seems rather negative. Recurrent crises in major EMEs but also in most advanced economies in the last decades and the persistence of poverty all around the world cast doubt on the aptness of a financially liberalized environment to give economies relevant and consistent means and ways with regard to the prerequisites of sustainable economic growth and development.
