The last 30 years has seen a dramatic “financialization” of pension systems as governments, particularly in Latin America and Eastern Europe, have replaced or complimented their defined benefit pay-as-you-go pension systems with financed, defined contribution alternatives. One side-effects of this switch has been a significant increase in the number of citizens whose welfare is directly tied to the movements of financial markets. This talk examines the political implications of this shift with respect to voting patterns, popular attitudes towards the market, and the sort of macroeconomic performance that citizens demand. The talk will place this recent round of pension reform and its effects in the context of other government initiated expansions of capital ownership, including Thatcher's enterprise society and Eastern European privatization in the early 1990s.
Andrew Kerner is an assistant professor in the political science department at the University of Michigan and a faculty associate at the Center For Political Studies. His research interests include various aspects of the politics of finance, including the politics of FDI allocation, corporate governance and the role of institutional investors (particularly pension funds) in emerging market policy-making. He is currently developing a book manuscript about the political implications of pension reform. Kerner received his PhD from Emory University (2009) and BA from Connecticut College (2002).
Kerner along with Timm Betz were the recipient of The Kenneth Organski Scholars Award awarded by the U-M's Institute for Social Research in 2013. The awards support young scholars and innovative social science research. Betz and Kerner intend to show that countries that finance their debt by issuing bonds denominated in foreign currencies are more likely to horde hard currency reserves and more likely to pursue trade disputes at the World Trade Organization in order to protect trade-based access to hard currency.