Financialization as Transnational Policy Insulation: Climate Finance in Brazil, 1990-2020

• In Event: 21068 - Global and Transnational Sociology of Climate Change

Abstract

In times of democratic and climatic breakdown, safeguarding funds from populist leaders can be crucial for policy survival. In this article, I reveal how processes of financialization can contribute to policy insulation. I show how lawyers and bureaucrats create financial intermediaries leveraging at least four socio-legal strategies that can potentially safeguard policy: (1) capitalization or who can finance an intermediary; (2) governance or what are the decision-making processes embedded in an intermediary; (3) procurement or which legal entity holds the funds; and (4) domestication or how is the intermediary connected to policy. To illustrate the utility of my framework, I adopt a two-step sequential mixed methods design using the case of climate finance in Brazil. First, I build a transnational climate finance dataset containing over 3600 grant-level payments to state and non-state actors in Brazil from 1990 to 2020. With network analysis, I trace the emergence of climate funds as financial intermediaries. In step two, with interview and archival data, I show how and why lawyers, bureaucrats, and donors designed financial intermediaries with specific capitalization, governance, procurement, and domestication strategies to safeguard climate policy. I conclude by discussing the effects of said strategies and calling attention towards how these strategies can safeguard policies in times of democratic backsliding.

Author

• Livio Silva Silva-Muller, Harvard University