The mainstream view presents money as a neutral medium of exchange — a tool that facilitates transactions between otherwise willing parties. Heterodox economists and political economists challenge this representation, arguing that money is fundamentally a social and political institution, deeply entangled with power.

Financialisation — the process by which financial activities have come to dominate economic life over the past four decades — has transformed the relationship between capital, labour, and the state. In a financialised capitalist economy, value is increasingly extracted through ownership and rent rather than production. This has given rise to what some call the rentier economy, in which returns on assets — property, shares, intellectual property — vastly outpace returns to labour.

The creditor-debtor dynamic is central to this analysis. Debt is not merely a financial instrument; it is a mechanism of social control. When households, firms, and governments are chronically indebted, their political and economic autonomy is constrained by the demands of creditors — often international financial institutions or bond markets with no democratic mandate.

Monetary sovereignty — the capacity of a government to issue and control its own currency — is a contested concept in this context. Countries that have relinquished monetary sovereignty, as eurozone members have done, face particular constraints in responding to crises. Heterodox frameworks such as Modern Monetary Theory argue that monetarily sovereign governments face no fundamental financing constraint and can spend more freely than conventional economics suggests.

The origins of contemporary financial structures in historical processes of primitive accumulation — enclosures, colonialism, dispossession — complicate any purely technical account of how modern economies function. Political economy, at its most rigorous, insists that these historical and power dimensions cannot be separated from the analysis of price, value, and growth.