Financialization in the Twenty-First Century: Contemporary Trends and Emerging Research Directions

Following the 2008 financial crisis, financialization has emerged as a central research program for analyzing the changing economy and its broader social consequences. This article examines recent scholarship on financialization and argues that this economic transformation has evolved substantially in the past two decades, demanding a more expansive analytical framework and new research directions. Focusing on the economy-wide organization of capital, we document three trends that characterize the contemporary manifestation of financialization in the United States: ( a ) rising intermediation by nonbank financial institutions, ( b ) growing investment in nontraditional financial assets, and ( c ) deepening household participation in the financial market as investors. These developments have wide implications regarding the stability of financial systems, the operation of businesses, and the distribution of economic resources across US society.