Although it may seem arcane or prosaic to some, the literature on the political economy of money and finance has burgeoned within political science since the mid-1980s. The two decades after the end of the Bretton Woods system in the early 1970s was a time of considerable macroeconomic volatility and cooperative effort to coordinate suitable policy responses. This stimulated scholarly inquiry. Since then, financial globalization has drawn in those interested in the challenge financial markets seem to pose to the official political order centered on states. This developing political science research tradition has, however, existed on the periphery of two other longer-standing literatures. The first is the economic history of monetary and financial affairs. This tradition has exhaustively investigated the formation, organization, and implications of the classical gold standard and the Bretton Woods order. This research stimulated many of the political science pioneers and remains seminal and vibrant. The other tradition to mention is that impulse in the social sciences to identify and characterize different forms, tendencies, or cycles in capitalism, and link these to distinct political and social orders. This much more controversial way of thinking has its origins in the great nineteenth-century systems of ideas. In more recent times, Karl Polanyi, Joseph A. Schumpeter, Alexander Gerschenkron, John Zysman, and the many authors associated with core-periphery and world systems theory have kept the tradition alive. Although many readers will assume Daniel Verdier's new book is unproblematically part of the political science tradition, it should be read squarely as a product of this last tendency, making use of the established historical work to generate a reinterpretation.

Verdier wants to tell a very big story. Moving Money seeks to explain the neglected, but as he sees it, central role of the constitution of states in creating the specific forms finance takes in different societies. Why have some societies been dominated by local banks (United States), while other societies—such as Britain—have been typified by centralized financial structures with just a few large banks? He argues that financial markets are, if allowed to organize things themselves, centralizing, inherently likely to pull money away from the peripheries. Could it be, he suggests, that the centralized and centralizing nature of some states stops local regions from retaining their financial assets, allowing these to be drawn into a financial center where the depth of financial markets offers the greatest returns? Decentralized states, in contrast, allow regions to establish barriers that help them retain local banking systems and thus retain financial resources in the periphery.

The author investigates the tendencies toward centralization and decentralization by considering four apt dimensions that order financial markets: spatial concentration, internationalization, market development, and specialization, in two time periods: 1850–1913 and 1960–2000. The analysis is comparative across the developed states of North America, Europe, and Australasia. The text consists of an interpretation of the existing economic history and political economy of money and finance literatures, to which he adds his own quantitative analysis of broad aggregates, focused on making his point about the impact of the centralization or decentralization of the state on the organization of banking. Verdier's reading of the qualitative literature used is schematic and abstract, and little in the way of historical specificity enters into his analysis. This is not a reading of financial history that most financial historians will appreciate.

It would be inane to celebrate this book as a “return to the state” in the study of the political economy of money and finance. Other authors have made the same ontological commitment in recent years. It would also underestimate the value of Verdier's contribution. Where he goes beyond most of the literature in the field is in being both more political and more financial. By political, I mean that he does not see the role of states as universal or interchangeable, like lightbulbs. What he thinks important is the differing constitutions or organization of states in relation to their societies. Decentralized states are quite different from centralized ones, he argues, with major implications for the possible forms of financial structure that can emerge. He is more financially sensitive than most writers in the field, too, because he understands different financial instruments and the likely impact of different institutional forms within banking.

Verdier's book is mainly a work of reinterpretation, rather than new research. Indeed, his original quantitative work may have less impact than it should. Many readers are likely to find the broad statistical comparisons he offers difficult. The fact that the research technique is so explicit will narrow the readership to established scholars and advanced graduate students. Agency seems to have little role in the account, with structural variables being the key to the pattern of development. Although sensitive to institutions and financial forms, this book is not influenced by constructivist thinking. It is certainly iconoclastic and undoubtedly a challenging read.

Moving Money is a work of great ambition and insight, a wide-ranging inquiry into issues of great import. As a work of political science, it is both strange in its comprehensiveness and narrow in its heavy emphasis on structural factors and neglect of agency. Despite this concern, in focusing squarely on forms of state and forms of finance, Verdier has made a major contribution to the political economy of money and finance, and possibly to the broader literature concerned with changing forms of capitalism and political organization. Whether this book stimulates debate among scholars will depend on their ability to appreciate its uniqueness. The likely benefits make that appreciation worthwhile.