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Western banks in Eastern Europe: New geographies of financialisation

Periodic Reporting for period 2 - GEOFIN (Western banks in Eastern Europe: New geographies of financialisation)

Reporting period: 2018-06-01 to 2019-11-30

Financialisation, or the growing power of finance over societies and economies, is increasingly recognised as the key feature of contemporary capitalism. However, significant gaps in our understanding of this process remain. Indeed, despite growing recognition that financialisation is an inherently spatial process, a geographically-informed view of financialisation remains underdeveloped. In addition, and related to this, the extent and the ways in which post-socialist ‘transition’ societies in East-Central Europe have been financialised remain under-researched and under-theorised. Yet, the examination of former state-socialist societies (built on the very opposite economic logic to that of financialisation) provides an unmatched opportunity to learn about financialisation itself, how it ‘penetrates’ societies and with what social and spatial implications. East-Central Europe in this sense constitutes a unique terrain for frontier research. GEOFIN is addressing the above shortcomings by producing empirical and theoretical insights to develop a geographically-informed view of financialisation. The objective is to examine how states, banks and households in post-socialist contexts have been financialised and to consider what implications this has for the societies in question and for Europe as a whole. The project is piloting a novel approach based on the concept of ‘financial chains’ which are understood both as channels of value transfer and as social relations that shape socio-economic processes and attendant economic geographies. A set of interlocking case studies are being mobilised to reveal the different ways in which banks, states and households across post-socialist East-Central Europe are interconnected by financial chains with each other and with a wider political economy. Empirically, GEOFIN focuses on ‘new’ EU member states, i.e. post-socialist countries that fully liberalised their financial systems (as part of the EU accession requirements) and are thus fully exposed to the forces of Western finance. These countries include: Poland, Hungary, Czechia, Slovakia, Slovenia (‘Central Europe’); Estonia, Lithuania, Latvia (the ‘Baltics’); Romania, Bulgaria, Croatia (‘South-East Europe’). In terms of dissemination of results, the project aims to produce up to 15 articles in leading international academic journals and one research monograph book. Research findings will also be disseminated via Working Papers, presentations at international conferences and through blog posts. GEOFIN will fundamentally advance our understanding of new geographies of financialisation, opening up new horizons in studies of finance and its future role in the society.
Task 1: Research framework (establishing working definitions, concepts and analytical categories of financialisation through an in-depth review of existing definitions of financialisation, via a series of interactive think-ins with the core team members and through interaction with the Academic Advisory Panel (AAP)):

The work related to Task 1 has been carried out via:
• Team Workshops (internal core team discussions & think-ins)
• GEOFIN international seminars – presentations by, and discussions with, invited international speakers on the topic of financialisation: Laurence Murphy, University of Auckland (October 2018); Fabio Betioli Contel, University of Sao Paulo (April 2018).
• Presentations to international conferences (with AAP members present)

Key achievement has been a further elaboration of the concept of ‘financial chains’ as a device to study financialisation in its various forms and settings. Specifically, the attention has been paid to the implications of ‘financial chains’ for uneven development in Europe (and beyond). The concept has been presented at a number of international academic events with valuable feedback gathered. Beyond-the-state-of-the-art conceptual developments related to ‘financial chains’ are significant on their own right, but they also (a) provide a sound guidance for subsequent empirical research in Tasks 2, 3 and 4; and (b) will feed into overall theoretical advances in Task 5 (Synthesis and Theory Building). A very good progress has also been achieved in defining financialisation specifically with regard to states, banks and households. Detailed literature reviews have been completed on the financialisation of states (Dr Mikuš) and the financialisation of households (Dr Bobek). Furthermore, related concepts of financial exclusion and redlining have been explored (Bencekovic).

Outputs related to Task 1 so far include 1 journal article publication, 3 Working Papers, 9 presentations and 2 Discussion Papers:


• Sokol, M. (2017) Financialisation, financial chains and uneven geographical development in Europe: Towards a research agenda. Research in International Business and Finance (RIBAF), Vol. 39, Part B, pp. 678-685. Invited contribution. DOI:

Working Papers:

• Sokol, M. (2017) Western Banks in Eastern Europe: New Geographies of Financialisation (GEOFIN research agenda). GEOFIN Working Paper No. 1. Dublin: GEOFIN, Trinity College Dublin.

• Bobek, A. (2019) Financialisation of households: a preliminary literature review. GEOFIN Working Paper No. 2. Dublin: GEOFIN, Trinity College Dublin.

• Mikuš, M. (2019) Financialization of the state in postsocialist East-Central Europe: conceptualization and operationalization. GEOFIN Working Paper No. 3. Dublin: GEOFIN research, Trinity College Dublin.


• Sokol, M. (2019) Financial Networks and Urban Networks in the International Division of Labour: A ‘Financial Chains’ Perspective. Paper for the 6th FinGeo Global Seminar (Geography, Finance and Uneven Development). Special panel session: Financial Networks and Urban Networks in the International Division of Labour. University of São Paulo, São Paulo, Brazil, 15-17 May 2019.

• Sokol, M. (2019) Networks of ‘Financial Chains’: Linking Finance, Geography and Uneven Development. Paper for the 6th FinGeo Global Seminar (Geography, Finance and Uneven Development), Special session: Finance and uneven development in Eastern Europe. University of São Paulo, São Paulo, Brazil, 15-17 May 2019.

• Sokol, M. (2018) Financial chains and new geographies of financialisation in East-Central Europe. Paper for the Fifth Global Conference on Economic Geography (GCEG), Specialist session on: Finance and financialisation in post-socialist Central and Eastern Europe. University of Cologne, Cologne, Germany, 24-28 July 2018.

• Sokol, M. (2018) Financialisation of housing in the European ‘semi-
To date, the following progress beyond the state of the art has been achieved:

1. Further elaboration of the concept of ‘financial chains’ as a device to study financialisation in its various forms and settings (Task 1).
2. Advancement of our understanding of financialisation of state in the post-socialist context (Task 2).
3. Advancement of our understanding of financialisation of Western banking groups in the post-socialist context (Task 3).
4. Advancement of our understanding of financialisation of households in the post-socialist context (Task 4).

Expected results until the end of the project:

1. Advancement of our theoretical understanding of financialisation based on a geographically-informed view, focusing on states, banks and households in the post-socialist context (Task 5).
2. Assessment of the implications of the East-Central European financialisation experience for wider Europe and development of alternative narratives of sustainable financial futures in Europe that would be compatible with the EU’s commitment to economic, social and territorial cohesion (Task 6).
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