The Code of Capital (Book Review)

36 Banking & Finance Law Review 323 (2021)

5 Pages Posted: 1 Dec 2020 Last revised: 17 May 2021

See all articles by Ryan Clements

Ryan Clements

University of Calgary Faculty of Law

Date Written: November 25, 2020


Global financial inequality was increasing before COVID-19 unleashed market and economic chaos. The pandemic has widened the wealth gap, exposing financial disparity in even the world’s most prosperous countries. While the COVID-19 crisis has expanded the fortunes of some, millions around the world face the unrelenting reality of poverty. While it’s difficult to deny the influence of ideology on the growing wealth divide, in some countries (particularly the United States) there might be another critical factor to consider – the law. In The Code of Capital – How The Law Creates Wealth and Inequality, Professor Katharina Pistor persuasively contents that “who has access to and control over the legal code” has power over the “levers” of societal wealth creation and distribution. Perhaps the book’s most contextually important contribution is the way it shows how the legal code has been used to continually “mint” debt-based instruments that are convertible into cash, universally traded, durably protected, and bestowing of priority rights on their holders. The net result is a “deeply hierarchical” but highly volatile and complex financial system. Post 2008 reforms have not eliminated the problems of unstable, contractually-driven, financial product innovation, perpetual credit generation, and the propagation of “too big to fail” financial institutions.

Keywords: Code of Capital, COVID-19, Book Review, Global Debt Loop, Financial Products

JEL Classification: K22, K29, G01, G23

Suggested Citation

Clements, Ryan, The Code of Capital (Book Review) (November 25, 2020). 36 Banking & Finance Law Review 323 (2021), Available at SSRN: or

Ryan Clements (Contact Author)

University of Calgary Faculty of Law ( email )

Murray Fraser Hall
2500 University Dr. N.W.
Calgary, Alberta T2N 1N4
4036191173 (Phone)

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