Households face two politically salient risks associated with financial instability. The first risk, which has existed for perhaps centuries, is associated with the indirect effect of systemic banking crises on employment and income flows. The second risk arises from the direct effects of crises on asset prices and thus household wealth stocks. Historically, the second risk mainly affected only a small wealthy elite. We argue that the rapid expansion and financialization of middle class wealth since the mid-twentieth century mean that many voters now have “great expectations” regarding government responsibility to protect their wealth. The political risks of financial instability for incumbent governments have thus increased sharply, especially when institutional constraints hamper their ability to respond to voters’ new expectations. We show that the probability of incumbent governments facing significant institutional constraints retaining office after systemic banking crises has indeed fallen sharply in recent decades compared to the pre-1945 period.

中文翻译：

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金融化，财富和银行业危机不断变化的政治后果

家庭面临与金融不稳定相关的两个政治上显着的风险。第一个风险可能已经存在了几个世纪，与系统性银行危机对就业和收入流动的间接影响有关。第二个风险来自危机对资产价格以及家庭财富存量的直接影响。从历史上看，第二种风险主要只影响少数富裕的精英。我们认为，自20世纪中叶以来，中产阶级财富的迅速扩张和金融化意味着许多选民对政府保护自己财富的责任抱有“巨大期望”。因此，现任政府的财务不稳定带来的政治风险急剧增加，尤其是在体制限制妨碍其回应选民新期望的能力时。