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Economies of contagion: financial crisis and pandemic

2013; Taylor & Francis; Volume: 42; Issue: 2 Linguagem: Inglês

10.1080/03085147.2012.718626

1469-5766

Robert Peckham,

Housing, Finance, and Neoliberalism

Abstract Abstract The outbreak of an influenza A (H1N1) pandemic in 2009 coincided with a severe global financial downturn (2007–8). This paper examines the use of ‘contagion’ as a model for assessing the dynamics of both episodes: the spread of infection and the diffusion of shock through an intrafinancial system. The argument is put that a discourse of globally ‘emerging’ and ‘re-emerging’ infection helped to shape a theory of financial contagion, which developed, particularly from 1997, in relation to financial crises in ‘emerging markets’ in Southeast Asia. Conversely, concerns about the economic impact of a global pandemic have been influential in shaping public health responses to communicable diseases from the early 1990s. The paper argues that tracing the conceptual entanglement of financial and biological ‘contagions’ is important for understanding the interconnected global environment within which risk is increasingly being evaluated. The paper also considers the consequences of this analogizing for how financial crises are understood and, ultimately, how responses to them are formulated. Keywords: contagionemerging marketsemerging infectionsnetworksanalogiesrisk This article is part of the following collections: Economy and Society in COVID Times Acknowledgements I would like to thank my colleagues in the Journalism and Media Studies Centre at the University of Hong Kong for co-sponsoring the panel ‘Constructing pandemics’ as part of the international conference ‘One year into the pandemic: Perspectives on risk and crisis communication’. I am grateful, in particular, to Thomas Abraham, Charles L. Briggs and Lisa Cartwright for participating in the conversation, and also to Maria Sin. Finally, I am grateful to the three anonymous reviewers who read earlier drafts of this paper and offered helpful suggestions. Notes 1. The term ‘Credit Crunch’ was included in the Oxford Concise Dictionary in 2008; see Mizen (2008 Mizen , P. 2008 . The credit crunch of 2007–2008: A discussion of the background, market reactions, and policy responses . Federal Reserve Bank of St. Louis Review , 90 ( 5 ), 531 – 67 . Retrieved from: http://research.stlouisfed.org/publications/review/08/09/Mizen.pdf [Web of Science ®] , [Google Scholar], p. 531). The influenza outbreak was declared a ‘pandemic’ in June 2009. See Margaret Chan's (2009 Chan , M. 2009 . Concern over flu pandemic justified . Speech to the 62nd World Health Assembly , Geneva , 18 May . Retrieved from http://www.who.int/dg/speeches/2009/62nd_assembly_address_20090518/en/index.html [Google Scholar]) statement: http://www.who.int/mediacentre/news/statements/2009/h1n1_pandemic_phase6_20090611/en/index.html 2. 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The confusion between ‘manufactured’ and biological hazards is also evident in the contemporary equation of terrorist attacks with pandemics: both are increasingly being framed as ‘security threats’ that jeopardize the operations of the state. See, for example, Mun (2005 Mun, K. C. 2005. Contagion and impulse response of international stock markets around the 9-11 terrorist attacks. Global Finance Journal, 16(1): 48–68. doi:10.1016/j.gfj.2005.05.002[Crossref] , [Google Scholar]), Muntean (2009 Muntean, N. 2009. Viral terrorism and terrifying viruses: The homological construction of the ‘war on terror’ and the avian flu pandemic. International Journal of Media and Cultural Politics, 5(3): 199–216. doi:10.1386/macp.5.3.199_1[Crossref] , [Google Scholar]) and Weiss (2009 Weiss , N. E. 2009 . Banking and financial infrastructure continuity: Pandemic flu, terrorism, and other challenges . CRS Report for Congress , 4 May . Congressional Research Service 7-5700; www.crs.gov. RL31873 . 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Financial contagion: The viral threat to the wealth of nations, New York: Wiley. [Crossref] , [Google Scholar], p. 4) and on the tension between disease and mechanism of transmission, see Claessens and Forbes, who also note that analogies between the spread of infectious disease and financial crises ‘are often overdone’ (2001, p. 4). 21. This is a coalescence which Wald has termed the ‘outbreak narrative’ (2008). For examples of popular narratives that conflate financial loss, social disorder and pandemic, see Steven Soderbergh's 2011 movie Contagion. 22. See, however, the argument against so-called ‘viral sovereignty’ presented by Holbrooke and Garrett in The Washington Post (2008 The Washington Post . 2008 . ‘Sovereignty’ that risks global health . 10 August . [Google Scholar]).