Finance, State, Digitization & Democracy

The genesis of modern statehood has led to a significant increase in the financial requirements of the public sector, which is only partially covered by taxes and fees. The state is therefore increasingly asking for loans or issuing bonds on the capital markets. It has also successively established central banks that act as lenders of last resort. It is therefore not only a demander, but also a major player on the capital markets. And it also shapes their framework conditions.

The expansion of the financial sector is linked both to the industrial revolution and the implementation of capitalist production methods as well as to increasing state activity. However, in order to reduce information asymmetries, protect the weak, strengthen the European single market or avoid further financial crises, the state often sets limits or imposes rules on financial intermediaries. Even more fundamentally, it can be stated that there is not a single financial product without a legal basis. No share, no bond, no loan and no derivative is born without legal norms. The question is therefore not one of market or state, but of the connections and ambivalences of the market-state relationship.

In a democracy – especially one in which digital technologies shape everyday life – the question of the role of the financial sector becomes even more pressing, as it is considered to be in need of regulation on the one hand and difficult to regulate on the other. In addition, the increased demand for capital can also lead to a certain dependence of the state on capital markets and thus make it more difficult to enforce democratic demands. The recent debate has also (re)raised the relationship between capital markets and distribution issues. In particular, this raises the question of how the conflicting goals of maximizing prosperity on the one hand and equitable distribution of economic goods on the other can be resolved. The third force in this area of conflict is the digital transformation, which is not just a “technical” issue. Under digital conditions, both capital markets and democracies are now fundamentally confronted with new requirements for communication, value creation and also the “traditional” understanding of currencies and payment systems.

The lecture series explores the ambivalent relationship between (digital) capital markets and (digital) democracy as well as the effects that evolving capital markets have on distribution issues. It reconstructs the history of capital markets and states as controversial as they were in earlier times and as they are today, on the one hand from the perspective of science, on the other hand it is also about a representation of facts and debates that is accessible to citizens. The lecture provides ways how to describe the issues at hand, raises the question of the objectives and means by which (digital) capital markets are (or should be) regulated and deals with the issues of prosperity and distributive justice in a digital world.

Programme