Project summary

My PhD project investigates the increased creation of Sovereign Wealth Funds (SWFs) over the past 25 years. SWFs are pools of public financial assets invested in international and domestic financial markets following commercially-oriented, profit-driven strategies. This new form of state investment is delegated either to an existing public body or to a newly created institution, and the choices governments make regarding the governance structures for these funds differ notably between countries. In some, governments can directly influence the investment of SWF assets and the use of their profits. In others, government interference is severely limited by the funds' structures. SWF creation, therefore, impacts the level of influence different public actors can have on the use of public finances as well as their allocation in the global economy.

I explore this phenomenon in the context of economic globalisation, financialization, and the global economic crises of the past three decades. Using novel quantitative data on SWF creation and the institutional structures that govern them, case study evidence, and interviews, I investigate the political economy factors that influence governments' use of SWFs as tools to address economic challenges. This work contributes to the literature on state financialization and the revival of industrial policy by analysing the institutional context in which SWFs operate.

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 for Development – Understanding Political Influence in Sovereign Wealth Funds" (Draft available on request)

This paper explores how SWFs support development goals and to what extent they respond to government policy. It introduces a framework to assess SWF governance through fund autonomy, stakeholder involvement, and rules-based governance. Using a novel dataset of 60 SWFs, I find significant variation in institutional arrangements. The analysis suggests that domestic political economy models shape governance, offering broader lessons for understanding public investment institutions.