Transnational Political Ordering in Global Finance
Binding political decisions are increasingly taken and enforced beyond national contexts. Private governance by companies, associations and interest groups characterizes different policy fields, but is particularly widespread in finance. The financial crisis of 2007/08 and the subsequent regulatory efforts highlight the major influence of private actors. Banks, service providers, standard setting bodies or international organizations are involved across national and institutional boundaries and assist the introduction, supervision and implementation of binding decisions.
What are the implications of these developments for the regulation of global finance? Which interests prevail, what are the political consequences that arise from the strong position private actors hold in the financial market regulation, and which agents organize opposition against the private self-regulation of financial market actors? These are the issues examined by the research group ‘Transnational political ordering in global finance’ which analyzes the emergence of a new regulatory order beyond the nation state.
The starting point for our research is the assumption that the de facto regulation of financial markets in parts has already escaped the control of national governments. Private governance – that is rule-setting, monitoring and sanctioning – has become increasingly dominated by private and transnational organizations and is no longer limited to political areas in which private self-organization has had a long tradition. Therefore, the research group examines the hypothesis that a social and political order arises beyond national jurisdictions, which determines the regulation of financial markets and thus also impacts directly on national governments and their regulatory efforts.
We are going to analyze the processes of transnational political ordering comparatively and in their historical contexts with particular consideration to four key questions:
- Which formal and informal rules govern the regulation of global financial markets?
- What norms and beliefs are at the core of this ordering, how they determine the scope of actors?
- Which individuals and organizations are involved in the emergence of this order, how do they cooperate in networks and how do they enforce their interests?
- What are the effects of these order processes on national policies within democratic societies?