SHADOW BANKING AS SEEN FROM A BEHAVIOURAL AND NEOCLASSICAL FINANCE PERSPECTIVE

Jan K. Solarz

doi:10.18778/0208-6021.310.12

Authors

Jan K. Solarz Ph.D. hab., Full Professor at The Academy of Social Sciences, Chair of Banking and Insurance Department

DOI:

https://doi.org/10.18778/0208-6021.310.12

Keywords:

shadow banking, behavioral finance, private money

Abstract

Money is not merely a highly exchangeable commodity or the symbol of value established in exchange by utility-seeking individuals. Private money is a value sui generis that is established by reactions between issuers-shadow banking and users of money. These relations can be explained by the behavioral theory of finance and neoclassic theory of finance.

Shadow banking and classical banking relations are characterized by the relations of both cooperation/trust and conflict/struggle, which give private money its value and produce the alternating phases of order and disorder.

If the link between the public and the private sector is to be bypassed or severed, should this be seen as an exceptional emergency measure or the first step in radical structural change in the social relations for the production of money? The Neo-institutional answer on this question is that the shadow banking is now in the first phase of its institutionalization. Shadow banking is a fundamental and systemic financial innovation. It encompasses all financial activity, except traditional banking, which requires a private or public guarantee and backing to operate.

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Author Biography

Jan K. Solarz, Ph.D. hab., Full Professor at The Academy of Social Sciences, Chair of Banking and Insurance Department

Jan K. Solarz, prof.zw.dr hab. Kierownik Katedry Bankowości i Ubezpieczeń Społecznej Akademii Nauk
mailto:jan.k.solarz@gmail.com

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