Inequality, Race, and the Politics of the Fringe Economy

Session Submission Type: Full Paper Panel

Session Description

American political economy is highly stratified based on race, class, and place. This panel examines to the politics of the fringe economy, examining the policies and politics behind the financial industries central to how lower-income Americans make ends meet. As the papers in this panel reveal, both the market and policies from multiple levels of government are relevant in contributing to the racialized political economy of the fringe financial industry.

The first paper, “Regulating Risk: The Emerging Political Economy of ‘FringeTech’” by Mallory SoRelle and Grace Beals, examines “fringetech”—the “innovations that offer digital, non-bank alternatives to existing fringe banking options.” Using original survey data and an original dataset of state payday loan regulations, the paper explores how state policies shape use and opinions about this emerging financial option. The next two papers explore the political dynamics around payday lending in particular. In “Political Knowledge and Policy Attitudes in a Racialized Economy,” Rhea Myerscough examines original survey data to explore how personal experiences with predatory industries shape attitudes toward regulation, with particular attention to whether or not individual experiences are equally influential across different racial groups. In the paper, “Following the Money: How Bank Financing Shapes the Local Geography of Payday Lenders” Megan Doherty Bea draws from an innovative original dataset that connects national, historical spatial data on the locations of payday lender storefronts and bank branches to archival records of financial ties between bank and payday companies. The paper reveals the important influence of bank financing on the spatial sorting of payday lenders across communities, suggesting a need for further regulation. A fourth paper by Serena Laws, “Mixed Messengers: Predatory Tax Preparers as Mediators Between Citizens and the Submerged State” examines the tax preparation industry as both a site of predation and political learning for low-income Americans. Systematic analysis of messaging from the three biggest tax preparation companies reveals that the tax preparation industry is an important, if distorting, mediator of the meaning of the refundable tax credits on which many of the poorest Americans rely. Finally, Tess Wise’s paper “The American Political Economy of Credit/Debt and Global Racial Capitalism” uses the case of the Great Recession and its aftermath as a vantage point to explore how the American political economy of credit/debt is part of a global system of racial capitalism. The paper develops the concept of intersectional racial privilege, the applies the concept to show how patterns of racial capitalism can be recovered in the comparative and global economic literature on the recession, in which the concept of racial capitalism is largely absent.

Sub Unit

• Division 55: Class and Inequality

Cosponsor

• Division 61: American Political Economy

Individual Presentations

• Regulating Risk: The Emerging Political Economy of “FringeTech” - Mallory E. SoRelle, Duke University; Grace Elizabeth Beals, Cornell University

• Political Knowledge and Policy Attitudes in a Racialized Economy - Rhea Myerscough, Butler University

• Following the Money: How Bank Financing Shapes the Geography of Payday Lenders - Megan Doherty Bea, University of Wisconsin-Madison

• Predatory Tax Preparers as Mediators between Citizens and the Submerged State - Serena Laws, Trinity College, Hartford CT

• The American Political Economy of Credit/Debt and Global Racial Capitalism - Tess Elizabeth Wise, Wake Forest University

Chair

• Patricia Posey University of Chicago

Discussants

• Chloe Thurston Northwestern University

• Sofia Butnaru The University of Chicago