Books and journals Case studies Expert Briefings Open Access
Advanced search

The Political Regime Factor in Austrian Business Cycle Theory: Historically Accounting for the US and Canadian Experiences of the 2007–2009 Financial Crisis

George Bragues

Studies in Austrian Macroeconomics

ISBN: 978-1-78635-274-3, eISBN: 978-1-78635-273-6

ISSN: 1529-2134

Publication date: 28 April 2016

Abstract

Austrian Business Cycle theory (ABCT) has lately drawn increased attention as a result of its ability to explain the US financial crisis of 2007–2009. However, its explanatory power is questioned by the Canadian experience of the crisis, where a similarly loose monetary policy to the United States did not give rise to a similarly calamitous outcome. Accounting for this difference points to the necessity of elaborating the political element already contained in ABCT. This task of political science is most fruitfully done by focusing on the regime, that is, the distribution of the state’s offices and powers. These shape the incentives and ideals that move political action toward the financial sector. Though both Canada and the United States have democratic regimes, their origins and historical development have caused these to vary in significant ways. These variances largely clarify why the negative consequences of easy money predicted by ABCT were less pronounced in Canada than the United States.

Keywords

  • Politics of banking
  • Business cycles
  • Financial crises
  • Financial regulation
  • E42
  • G01
  • G28
  • N21
  • N22

Acknowledgements

Acknowledgment

An earlier version of this paper was presented at the fourth biennial Wirth Institute Workshop on Austrian Economics which was held at Carleton University in Ottawa, Canada, October 31–November 1, 2014.

Citation

Bragues, G. (2016), "The Political Regime Factor in Austrian Business Cycle Theory: Historically Accounting for the US and Canadian Experiences of the 2007–2009 Financial Crisis", Studies in Austrian Macroeconomics (Advances in Austrian Economics, Vol. 20), Emerald Group Publishing Limited, pp. 137-161. https://doi.org/10.1108/S1529-213420160000020007

Download as .RIS

Publisher

:

Emerald Group Publishing Limited

Copyright © 2016 Emerald Group Publishing Limited

Please note you do not have access to teaching notes

You may be able to access teaching notes by logging in via Shibboleth, Open Athens or with your Emerald account.
Login
If you think you should have access to this content, click the button to contact our support team.
Contact us

To read the full version of this content please select one of the options below

You may be able to access this content by logging in via Shibboleth, Open Athens or with your Emerald account.
Login
If you think you should have access to this content, click the button to contact our support team.
Contact us
Emerald Publishing
  • Opens in new window
  • Opens in new window
  • Opens in new window
  • Opens in new window
© 2021 Emerald Publishing Limited

Services

  • Authors Opens in new window
  • Editors Opens in new window
  • Librarians Opens in new window
  • Researchers Opens in new window
  • Reviewers Opens in new window

About

  • About Emerald Opens in new window
  • Working for Emerald Opens in new window
  • Contact us Opens in new window
  • Publication sitemap

Policies and information

  • Privacy notice
  • Site policies
  • Modern Slavery Act Opens in new window
  • Chair of Trustees governance statement Opens in new window
  • COVID-19 policy Opens in new window
Manage cookies

We’re listening — tell us what you think

  • Something didn’t work…

    Report bugs here

  • All feedback is valuable

    Please share your general feedback

  • Member of Emerald Engage?

    You can join in the discussion by joining the community or logging in here.
    You can also find out more about Emerald Engage.

Join us on our journey

  • Platform update page

    Visit emeraldpublishing.com/platformupdate to discover the latest news and updates

  • Questions & More Information

    Answers to the most commonly asked questions here