PERSON
Hyman Minsky
American economist (1919–1996) whose financial instability hypothesis provided the theoretical framework Kindleberger extended through historical comparison — the thesis that stability itself breeds the conditions for crisis.
Hyman Minsky spent his career as a heterodox economist, teaching at Berkeley, Washington University in St. Louis, and the Levy Economics Institute of Bard College. His financial instability hypothesis argued that capitalist economies naturally transition through stages of increasing fragility: from hedge finance (where borrowers can service debt from cash flows) to speculative finance (where borrowers can pay interest but must roll over principal) to Ponzi finance (where borrowers can only service debt by borrowing more). The transition is not caused by external shocks but by the internal dynamics of successful economic expansion. Stability breeds risk-taking, which breeds leverage, which breeds the fragility that produces the 'Minsky moment' of crisis.
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Kindleberger's framework drew extensively on Minsky's theoretical architecture while adding the historical specificity that Minsky's more abstract formulations lacked. Where Minsky theorized the financial instability hypothesis as a general mechanism, Kindleberger documented its operation across specific historical cases — the tulip mania, the South Sea Bubble, the railway frenzy, the 1929