The crisis: a return to political economy?

Abstract

Purpose

This paper aims to examine the current financial crisis, suggesting that most analyses have attributed the crisis to a lack of business ethics, the rise of greed and lax regulation. Prescriptions offered to address this crisis draw accordingly on the need for greater regulation of market behaviour, business practices and boardroom pay. Whilst these reforms are necessary, they fail to recognise that such business practices have their roots in an extreme political and economic ideology – neoliberal market fundamentalism. This paper seeks to suggests that a greater appreciation of the nexus between politics, philosophy and economics is critical in order to develop a different practice. As such, the author provides a socio‐historical and political context for understanding the present crisis before offering a critique and reform of the business educational agenda. The author argues that such a context would engender greater understanding of business practices and systems for both students and practitioners and would go some way in enabling them to fashion a more critical reflexive and engaged practice.

Design/methodology/approach

The paper draws on a critical‐historical review of the literature on the crisis. In so doing, the paper opens up the analysis to philosophical and political approaches to understanding financial crises.

Findings

The paper finds that explanations for the crisis can be found through a critical appreciation of philosophical and political texts. This finding also suggests that current business and management education and practices can benefit from an incorporation of these historical strands of thought.

Research limitations/implications

In drawing on various strands in philosophy, politics, economics and sociology, the paper finds that a singular account for the crisis is flawed. The paper also finds that a richer and deeper appreciation of the crisis can be found through a critical‐historical positioning of the crisis. This necessitates an understanding of politics and philosophy in business practices and education.

Practical implications

In explaining the crisis, the paper suggests that many of the current financial “innovations” are problematic and a more critical approach is needed to engage with these “new” innovations.

Originality/value

The paper seeks to open up new vistas for business education and practices. Through a critical‐historical interrogation of the crisis, the paper opens up new spaces for understanding international economics and business practices. This reflexivity is often missing in international business studies and most management practices.

Citation

Wong, L. (2009), "The crisis: a return to political economy?", Critical Perspectives on International Business, Vol. 5 No. 1/2, pp. 56-77. https://doi.org/10.1108/17422040910938686