ABSTRACT
This chapter explains the H. P. Minsky's thought on the development of the economy. It presents Minsky's institutional analysis of the development of the economy and how financial regulation fits in it. The chapter begins with Minsky's starting points in the analysis of the economic system that were developed in his later works from the 1990s, where the awareness of the institutional dimension of the economic activity was more explicit. In particular, the unfolding of business cycles and long waves is presented as the interaction between, on one hand, the system's endogeneous dynamics, and on the other hand, the impact institutions and interventions. Institutions and interventions should constrain market processes to viable or acceptable outcomes. Bricolage in each new conjuncture creates fragile, complex circuits between heterogeneous acts and instruments. Financial innovation is bricolage that involves improvisation, creation of structures out of events and what comes to hand readily and what is available conjuncturally.
