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The Power of Banks and Governments


Reinke, Raphael (2016). The Power of Banks and Governments. Accounting, Economics, and Law, 6(1):57-63.

Abstract

This article examines Cornelia Woll’s book on the “power of collective inaction” in which she argues that banks could extract favorable bailouts in the recent global financial crisis by remaining collectively inactive. Collective inaction forces governments to bear the brunt of the crisis resolutions. While this book provides an illuminating account of banking bailouts in several countries, its argument neglects the power of governments and of individual banks. Governments did not have to wait for banks’ (in)action but could impose punitive conditions on banks. And the resistance by banks did not originate from an incapacity to act collectively but from deliberate actions by individual banks to obstruct government intrusion. Rather than <jats:italic>inaction</jats:italic> on the part of banks, these interactions between governments and banks involved deliberate <jats:italic>action</jats:italic> and their outcome depended on more conventional notions of state-business power relations.

Abstract

This article examines Cornelia Woll’s book on the “power of collective inaction” in which she argues that banks could extract favorable bailouts in the recent global financial crisis by remaining collectively inactive. Collective inaction forces governments to bear the brunt of the crisis resolutions. While this book provides an illuminating account of banking bailouts in several countries, its argument neglects the power of governments and of individual banks. Governments did not have to wait for banks’ (in)action but could impose punitive conditions on banks. And the resistance by banks did not originate from an incapacity to act collectively but from deliberate actions by individual banks to obstruct government intrusion. Rather than <jats:italic>inaction</jats:italic> on the part of banks, these interactions between governments and banks involved deliberate <jats:italic>action</jats:italic> and their outcome depended on more conventional notions of state-business power relations.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:National licences > 142-005
Dewey Decimal Classification:Unspecified
Language:English
Date:1 March 2016
Deposited On:23 Jul 2019 14:36
Last Modified:07 Apr 2020 07:21
Publisher:De Gruyter
ISSN:2152-2820
OA Status:Green
Publisher DOI:https://doi.org/10.1515/ael-2016-0003
Related URLs:https://www.swissbib.ch/Search/Results?lookfor=nationallicencegruyter101515ael20160003 (Library Catalogue)

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