The prevalence acquired by the neo-liberal ideology and its consequence, the growing financialization of advanced economies, notably the United States, has given increasing importance to neo-classical frameworks in designing economic policy and has contributed to a dichotomy between economics and ethics. The dynamics generated relied largely on confidence in the intrinsically regulating power of markets and on high risk-taking, which generated systemic risk, as illustrated by the Great Recession.

The analysis of the 2007-8 crisis provides ground for questioning this substitution of “political economy” by a purely economic logic. Despite the depth and global dimension of the crisis, the crisis has not led to a major new theoretical paradigm by mainstream researchers. On the other hand, the growth model of financial capitalism has been further challenged by heterodox economists. Financial instability has been acknowledged as having far-reaching consequences in terms of social costs. Consequently, we observe a return of moral considerations in post-crisis era, with an attempt at regulating the banking and financial sector so as to channel profit-driven practices likely to destabilize the economy and threaten growth, employment and economic equality. Thus, it is recognized that economic mechanisms should be once again inscribed within a larger political economy perspective, and that they may be subjected to ethical scrutiny.

In the first part of this paper, the relationship between economics and ethics is analyzed. Beginning with the heritage of 18^th century “Moral Economists” and, later, of Karl Polanyi, the arguments against a separation between economics and ethics are reviewed. In the second part, we analyze more precisely the ethical dimension of financialized capitalism and the implication of a system where speculative behavior has gained increasing importance: we study the implications for meritocracy and the value of labor, as well as the broader social implications of endangering financial stability, seen as a “public good”. We attempt at demonstrating that the strict separation built up over the years between economics and ethics is neither justified nor viable. Lastly, we explore more closely the new avenues opened in the history of economic thought with the emergence of post-crisis views of political economy. We show how the ethical dimension is integrated and how this may modify policymaking and contribute to the criticism of existing policies.