Skip to main content

Western banks in Eastern Europe: New geographies of financialisation

Periodic Reporting for period 3 - GEOFIN (Western banks in Eastern Europe: New geographies of financialisation)

Reporting period: 2019-12-01 to 2021-05-31

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. 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:

Outputs so far:

• 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: http://dx.doi.org/10.1016/j.ribaf.2015.11.007

• 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.

• 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.


Task 2: States

Outputs include:

• Mikuš, M. (2019) Financialization of the state in postsocialist East-Central Europe: analysis of secondary quantitative data. GEOFIN Working Paper No. 4. Dublin: GEOFIN research, 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.


Task 3: Banks

Outputs (selected):

• Dal Maso, G. and Sokol, M. (2019) Western European Banking Groups in East-Central Europe: A Preliminary Overview. 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.

• Rodik, P. (2019) Chaining Households to Financial Markets: Micro-level Interest-Bearing Strategies of Western Banks in Croatia. GEOFIN Working Paper No. 8. Dublin: GEOFIN research, Trinity College Dublin.

• Dal Maso, G. and Sokol, M. (2018) Western Banks in post-socialist East-Central Europe: Towards new perspectives on financialisation. Paper for the Finance & Society Network “Futures of Finance and Society” Conference. University of Edinburgh, Edinburgh, UK, 6-7 December 2018.


Task 4: Households

Outputs include:

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

• Rodik, P. (2019) Household Debt in Croatia: An Overview of Recent Trends. GEOFIN Working Paper No. 6. Dublin: GEOFIN research, Trinity College Dublin.

• Rodik, P. (2019) Croatia: socio-economic context and sub-national overview for the study of financialisation of households. GEOFIN Working Paper No. 7. Dublin: GEOFIN research, Trinity College Dublin.

• Mikuš, M. (2019) Contesting household debt in Croatia: the double movement of financialization and the fetishism of money in Eastern European peripheries. Dialectical Anthropology. https://doi.org/10.1007/s10624-019-09551-8


Task 5: Synthesis & Theory Building will address Objective D: To advance theoretical understanding of financialisation based on a geographically-informed view, focusing on states, banks and households in the post-socialist context and the way in which these actors are interconnected with each other and with a wider political economy via ‘financial chains’ across different spatial scales (from local/regional and national to European and global) and through time.

Task 6: Financial Futures will address Objective E: To assess the implications of the East-Central European financialisation experience for wider Europe and to develop alternative narratives of sustainable financial futures in Europe that would be compatible with the EU’s commitment to economic, social and territorial cohesion.

Task 7: Validation and Dissemination
In terms of dissemination efforts, a key achievement has been the establishment of GEOFIN’s active dissemination channels, namely: Facebook, Twitter, LinkedIn and ResearchGate.
Further to this, a dedicated GEOFIN website (https://www.geofinresearch.eu/) has been established
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).
GEOFIN project logo