Market Exchange, Self-Interest, And the Common Good: Financial Crisis and Moral Economy (Report‪)‬

The central Lesson for Political Economy The central problem of the financial crisis--as viewed from my philosopher's perspective, at least--is the failure of self-regulation by self-interest to moderate externalized risk in the financial system. Self-interested market actors--mortgage lenders, securities traders, investment bankers, and bond insurers--made risky investments on the assumption that the risk could be moderated by dispersal throughout the financial system. That assumption failed.