| The dissertation explores how the U.S. housing finance market is politically constructed and how it transformed and remade the American financial landscape. It examines the role of policy ideas, creative legal and regulatory actions, and institutional change involved in the U.S. housing finance market that led to the subprime mortgage crisis in 2007. It analyzes the historical context of the initial emergence and development of subprime loans as well as housing policy that promotes low-income homeownership, and how the U.S. government increasingly relies on the housing markets and private capital to fuel and expand the economy.;Five aspects needed to be taken into consideration to understand the shift in the U.S. residential mortgage markets from being facilitated by thrifts and government-sponsored enterprises to being driven by private capital actors. They include: 1) the civil rights discourse demanding for a housing justice, and the budget deficit in the late 1960s; 2) the deregulation of finance, particularly, Regulation Q; 3) the savings and loan crisis and the construction of a market for nonperforming loans; 4) the ideology of homeownership and the "responsibility of the self"; and 5) the US international economic position, and international capital that helped finance the American consumers' debt.;Using President's Reports, the government reports, presidential speeches, newspaper and secondary literature on housing and deregulation of finance, I show that the government constructs and facilitates the working of housing finance markets. My dissertation will contribute to American Political Development by adding political economy of housing finance market and the political aspect of housing and credit markets to the development of political history. The dissertation joins scholarly works that criticize and challenge the idea that the US economy is a self-regulating market, and the historical institutionalism literature. Drawing upon the framework of institutional approach that embraces constructivist view, I argue that political debates, policy ideas, and creative actions and experiments informed institutional change and innovation in the housing finance markets and these debates and ideas were interrelated with historical institutions of class and race politics in the U.S. as well as with the U.S. economy and its position in the international economy. |
