Theory and explanation in economics and in financial geography

Wójcik and Bratton's article on ‘theory and explanation’ argues that financial geographers should reverse their ‘push away’ from economics by making use of economists’ methods and models, as this will enable researchers in this emerging field to develop ‘middle-range’ theories, as recently advocated by Henry Yeung. A closer approach to economics is in order; but it must necessarily be critical. Economics is a field with multiple theoretical cores, and explanation in economics often involves validating the key assumptions of one of them. Economists blur the line between theory and explanation due to limitations imposed by their theoretical and methodological precommitments. Consequently, geographers’ development of ‘middle-range’ theories that describe how real-world mechanisms and systems work can augment economists’ explanations. As an emerging field, financial geography can explore not only the spatial production of finance and the financial production of space, but the socio-economic context and policy implications of the availability, absence, malfunctioning, and regulation of finance in local, regional, national, and global spaces.