Abstract
The widely touted Great Moderation and its calamitous end seemingly fit the financial instability hypothesis perfectly. Not by chance, the subprime crisis has been considered the result of a ‘Minsky credit bubble’, as the ‘Minsky moment’ preceding a ‘Minsky meltdown’ (Roubini, 2007a and 2007b; Whalen, 2007; Wray, 2007).
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Arestis, P. and De Antoni, E. (2008), ‘Minsky’s financial instability hypothesis: the crucial role of fiscal policy’, in Sawyer, M. and Creel, J. (eds), Current Thinking on Fiscal Policy, New York: Palgrave Macmillan, pp. 51–77.
Borio, C. (2008), ‘The financial turmoil of 2007–?: A preliminary assessment and some policy considerations’, Bank for International Settlements. Working Paper No 251.
De Antoni, E. (2009), ‘Minsky’s “financial instability hypothesis”: the not-too-Keynesian optimism of a financial Cassandra’, in Zambelli, S. (ed.), Computable, Constructive and Behavioural Economic Dynamics. Essays in Honour of Kumaraswami Velupillai, London: Routledge, forthcoming.
Keynes, J.M. (1936), The General Theory of Employment, Interest and Money, London: Macmillan.
Krugman, P. (2009), The Return of Depression Economics and the Crisis of 2008, New York: Penguin Books.
Leijonhufvud, A. (2007), ‘The perils of inflation targeting’, Vox EU, 25 June, available online.
Leijonhufvud, A. (2009), ‘Out of the corridor: Keynes and the crisis’, Cambridge Journal of Economics Advance Access published May 29.
Minsky, H.P. (1963), ‘Can ‘It’ happen again?’, in Carson, D. (ed.), Banking and Monetary Studies, Homewood, Illinois: R.D. Irwin, pp. 101–11.
Minsky, H.P. (1974), ‘The modelling of financial instability: An introduction’, in Instrument Society of America (ed.), Modelling and Simulation Vol. 5. Proceedings of the 5th Annual Pittsburg Conference, pp. 267–72.
Minsky, H.P. (1975), John Maynard Keynes, New York: Columbia University Press.
Minsky, H.P. (1977), ‘The financial instability hypothesis: An interpretation of Keynes and an alternative to standard theory’, Nebraska Journal of Economics and Business, 16(1), pp. 5–16.
Minsky, H.P. (1978), ‘The financial instability hypothesis: A restatement’, Thames Papers in Political Economy, North East London Polytechnic. Reprinted in Arestis, P. and Skouras, T. (eds), 1985, Post Keynesian Economic Theory. A Challenge to Neoclassical Ecconomics, Brighton: Wheatsheaf Books, pp. 24–55.
Minsky, H.P. (1980), ‘Capitalist financial processes and the instability of capitalism’, Journal of Economic Issues, 14(2), pp. 505–22.
Minsky, H.P. (1982a), Can ‘It’ Happen Again? Essays on Instability and Finance, Armonk, NY: M.E. Sharpe.
Minsky, H.P. (1982b), ‘Debt deflation processes in today’s institutional environment’, Banca Nazionale del Lavoro–Quarterly Review, 143(4), pp. 375–95.
Minsky, H.P. (1986), Stabilizing an Unstable Economy, New Haven: Yale University Press.
Minsky, H.P. (1991), ‘Financial Crises: Systemic or Idiosyncratic?’, Working Paper Series N. 51, Jerome Levy Economics Institute of Bard College, Annandale-on-Hudson, NY.
Roubini, N. (2007a), ‘Is the recent episode of market turmoil a temporary shock or the beginning of a systemic risk episode?’, RGE Monitor, 2 August. Available online at http://www.rgemonitor.com./blog/roubini/208728.
Roubini, N. (2007b), ‘Worse than LTCM. Not just a liquidity crisis; rather a credit crisis and crunch’, RGE Monitor, 9 August. Available online at: http://www.rgemonitor.com./blog/roubini/209779.
Whalen, C.J. (2007), ‘The US Credit crunch of 2007. A Minsky moment’, Public Policy Brief N. 92, Jerome Levy Economic Institute of Bard College, Annandale-on-Hudson, NY.
Wray, R. (2007), ‘Lessons from the subprime meltdown’, Working Paper Series N. 522, Jerome Levy Economic Institute of Bard College, Annandale-on-Hudson, NY.
Editor information
Copyright information
© 2010 Elisabetta De Antoni
About this chapter
Cite this chapter
Antoni, E. (2010). The Subprime Crisis: A Minskyan Phenomenon?. In: Fontana, G., McCombie, J., Sawyer, M. (eds) Macroeconomics, Finance and Money. Palgrave Macmillan, London. https://doi.org/10.1057/9780230285583_13
Download citation
DOI: https://doi.org/10.1057/9780230285583_13
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-31043-2
Online ISBN: 978-0-230-28558-3
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)