Project summary

My PhD thesis examines why many states have created SWFs over the past thirty years and analyses the governance arrangements through which states exercise control over these new agents of state-led investment. It shows how the expansion of SWFs reshapes the role of the state in market finance as governments increasingly participate in markets as active investors.

SWFs are fully state-owned investment vehicles that pursue commercially oriented, profit-driven strategies. Over the past thirty years, they have grown in both number and assets under management, becoming a significant group of investors that shape the global allocation of capital, both through equity investment and through the formation of long-term international investment partnerships with public and private actors.

Their rise raises fundamental questions about whether global finance is becoming more politicised as states reassert themselves as active investors. At the same time, SWFs may signal a broader trend towards the marketisation of public investment, as market-based motives and logics increasingly structure decisions about the allocation of public financial resources. Understanding whether SWFs function primarily as politicised instruments of the state or as vehicles for market-oriented investment is therefore central to assessing how they reshape state–market relations and patterns of international economic cooperation.

In my thesis research, I situate the rise of SWFs within the broader context of economic globalisation, financialisation, and the major economic crises of the past three decades. Using a mixed-methods research design, including cross-national data on SWF creation between 1970 and 2018, a novel dataset on the governance structures of 60 SWFs in 2022, and four case studies (Ireland, France, Nigeria, and China), I show that the Global Financial Crisis in particular spurred new SWF creation as a state-led yet market-oriented response to mounting economic challenges. I further demonstrate that SWF governance structures reflect nationally specific ideas about the appropriate role of the state in the economy.

Overall, this research identifies the conditions under which SWFs are likely to become politicised instruments of state-led investment versus vehicles for the marketisation of public finance. It contributes to three strands of scholarship: research on state-led finance in the twenty-first century, work on how economic crises shape policy trajectories, and comparative capitalism approaches that highlight the persistence of diverse models of state–economy relations.

You can read the full manuscript-style thesis here.

Working papers in this project

"Global Crises, the Power of Finance and the Rise of Sovereign Wealth Funds" (Draft available on request)

This paper examines the connection between international financial crises and the creation of SWFs, an understudied economic policy tool. While existing literature sees SWFs primarily as managers of natural resource wealth and foreign exchange, this fails to explain their global rise. I argue that the trend toward SWF creation stems from the Asian Financial Crisis of 1997 and the Global Financial Crisis of 2008–09. Facing pressure to respond but unwilling to hurt financial interests, governments turned to deeper market participation through SWFs. Using a dataset on 85 SWFs from 1970–2019, I show that crises are pivotal moments in SWF formation. The likelihood of SWF creation increases with the economic importance of finance.

"The ”State” in State-led Finance - Measuring Political Influence in Sovereign Wealth Funds" (Draft available on request)

This paper examines the governance of SWFs to understand how they balance political influence and market-oriented investment. I argue that SWF governance varies along three key dimensions that characterise the relationship between SWFs and their political principals: fund autonomy, public actor involvement, and approaches to rules-based governance. Using a novel dataset covering 60 SWFs from 51 countries in 2022 and 18 governance indicators, I employ descriptive analysis and multiple factor analysis to investigate cross-fund variation. The results show that these three dimensions meaningfully structure governance differences and help identify distinct models of state–fund manager relationships. The findings highlight the importance of governance arrangements for understanding SWFs' capacity to act autonomously or as instruments of state policy and offer a framework applicable to other public financial institutions.