This paper first briefly outlines the background to the 2007-08 international financial crisis. It then
goes on to examine five of the main approaches that have been put forward to explain the crisis: that
widespread presence of perverse incentives; the over-expansionary monetary policy of the US Federal
Reserve; the impact of global imbalances and a so-called ‘savings glut’ in developing countries; the
extensive deregulation of the financial system since the 1970s; and the attempt to generate an
increasing return on all forms of capital and the associated pressure on wages. The paper concludes
with a brief note on the policy implications which follow from each of these explanations.