Locating financialization in a less-developed economy: Micro responses to liberalization and volatility in Pakistan

Abstract

Drawing on fieldwork findings in homes and marketplaces in Pakistan, the article identifies processes of financialization in a small, open, low-income and fragile state. The article locates empirical responses to financialization in the creation of new speculative asset markets and in new forms of financialized behavior, reflecting new forms of financialized risk. In establishing links between the volatility that arises with liberalization in a context of financialized globalization and the financialization of everyday economic strategies and of certain markets, the analysis pivots around the relationship between risk and money. The article thereby contributes to the financialization literature, taking as a starting point the volatility that the financialization of global markets instills in prices as domestic money itself takes on the volatile pricing patterns of a financialized market. Financialization here plays itself out not in terms of the financial norms of advanced economies but in terms of the specific institutional context of a low-income economy.