Introduction: Spanish Banking—How Do We Explain a History of Fragility?

Abstract

This introductory chapter outlines the framework of analysis to explain why banking systems have been unstable in Spain, with a particular emphasis on the 2008 banking crisis and the 2012 financial bailout. It applies the framework developed by Calomiris and Haber (Fragile by Design: The Political Origins of Banking Crises & Scarce Credit. Princeton, Princeton University Press, 2014), and argues that Spanish institutions could not prevent opportunities for the development of rent-seeking coalitions between populist and bankers. This has led to less stable banking system (i.e., more crisis prone) that has provided less abundant credit. The chapter also places the book in the context of the wider literature on financial systems and varieties of capitalism, describes what is unique about this book, and examines the structure of the Spanish banking system.