​Financialisation

  • Recently, Chief Economic Adviser (CEA) to the Government of India cautioned that financialisation, that is, the dominance of the role of financial markets in public policy, might distort macroeconomic outcomes.
  • Financialization is the increase in size and importance of a country's financial sector relative to its overall economy.
  • It is a process whereby financial markets, financial institutions, and financial elites gain greater influence over economic policy and economic outcomes.
  • It represents the shift from traditional industrial or productive activities (like manufacturing) to financial activities that involve the trading, management, and speculation of financial assets.
  • It impacts both the macroeconomy and the microeconomy by changing ....
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