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The New Economy
and Financial Change in Europe
Steve Weber of UC Berkeley, Project Leader
It was inspired by the flood of new evidence from the last five
years pointing to significant social and economic activities that
are not traditionally associated with European political economies.
Some of the surprising "new economy" developments include an unprecedented
amount of venture capital investment channeling into entrepreneurial
firms, a rapid opening of capital markets to young firms formerly
limited to national bank lending, and high levels of household wealth
flowing into high-risk instruments. Early evidence suggests these
and other new patterns are affecting career choices and retirement
expectations, and have the potential to shape political identities
and add fuel to debates about wealth distribution and the future
of the welfare state.
The research group focuses on change in financial institutions as
a vehicle for understanding new economic, social and political activities.
Earlier literature uncovered core relationships between national
financial systems, on the one hand, and public policies and social
activities, on the other. Scholars in this tradition demonstrated
that they could infer defining features of a society through the
study of its financial system. Focusing on financial institutions,
individual research papers will evolve around three core sets of
questions:
- Whether the categories of institutional change in
finance developed in earlier decades still captures the essence
of European financial change in the 21st century
- The causal relationships between institutional change in finance
and the emergence of new social and economic activities
- The causes of the contemporary financial change.
The recent collapse in stock prices and the recession in high technology
sectors have revealed gaps in the ability of European regulations
and institutions to support new economy activities. Participants
seek to take advantage of the current lull to conduct frank discussions
among European venture capitalists, executives of the European exchanges,
regulators and academics about future public policies at the EU
and national levels.
Researchers in this project gathered for a planning session in
the Fall of 2001, and have organized a speaker series focused
on these
questions that will run throughout the academic year. In the Spring
semester 2002, the conveners will hold a conference to present
their
preliminary findings. The conference, thus far entitled "Venture
Capital, New Markets, and Corporate Governance," will take
place in Brussels. |
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