The crisis of 2007-2008 has provided fertile ground for questioning the adequacy of theoretical tools to examine economic crises. This study, therefore, suggests alternative interpretations of the ‘Great Recession’ to understand the inner dynamics of the crisis by opposing the form of casual relationships in academic literature. In many respects, ‘Great Recession’ was an unprecedented phenomenon that the capitalist system has experienced. Therefore, arising from the fact that there are a variety of different explanations for the causes of the crisis, the main aim of this study is to develop a better understanding of the ‘Great Recession’. To that end, the first chapter intends to summarize the main arguments of mainstream economics on a conceptual basis. Not surprisingly, mainstream economics asserted that the capitalist system is not inherently unstable, thereby embracing a vision that is based on the metaphor, “black swan”. According to this vision, crises are exogenous to the capitalist system and very rarely occur. However, there might be several theoretical arguments to explain the roots of economic crises, such as excessive government intervention, misguided policies, and agency problems. What remains clear in this theoretical framework is that the crisis is not a systemic failure, thereby rejecting alternative explanations. Such expositions are unsatisfactory because the concept of economic crisis, irrespective of their causes, is an inevitable fact in the capitalist system. As a consequence of challenging mainstream insights and adopting a heterodox vision, this study seeks to provide alternative explanations for interpreting the crisis beyond well-known stories. The first section, therefore, summarizes main arguments of Marxist theories by both focusing on conventional explanations and relating them to the current crisis. Having its roots in heterodox arguments, the study highlights possible alternative explanations for the ‘Great Recession’. First point, combining Radice and Brenner’s theories, addresses the neoliberalism and class theory as the cause of the crisis by pointing out that the capitalist system is already in crisis. In the second explanation, Dumenil and Levy, additional to neoliberalism, locate their emphasis on the notion of hegemony and argues that the crisis is an outcome of neoliberalism and hegemony in an US-driven capitalist world. Unlike abovementioned mechanisms, Lapavitsas offers an analytical apparatus to understand the crisis, ‘financialization’. According to Lapavitsas, it is not possible to envisage a crisis without putting emphasis on the notion of financialization. The study, focusing on the current literature, draw attention to the Streeck’s and Varoufakis’ arguments, respectively, “buying time” and “global Minotaur”. According to Streeck, the history of capitalism should be seen as a series of crises and treated crises as historical normals for capitalism. Capitalism enters a new phase with each crisis, and new phases form the starting points of new crises. Conceptualizing historical process in three different periods; “tax state, debt state, and consolidation state”, Streeck clearly shows that capitalism, in each phase, delays its crisis by “buying time” and with different policy options, such as public debt, private debt, and austerity measures. Based on the concept of “parallax”, Varoufakis mainly tries to grasp the reality despite of the fact that many observations regarding the crisis might be both accurate and misleading. For that purpose, he uses the mythological figure, “the Minotaur” to understand the inner dynamics of the crisis. According to Varoufakis, the US, as a “global vacuum cleaner”, increased their twin deficits and absorbed world’s leading surplus economies and mass profits in a global scale transferred back in the form of capital inflow to the US through Wall Street: “The Crash of 2008 was what happened when a beast I call the Global Minotaur was critically wounded”.

As argued by Harvey (2015a), “[t]he manner of exit from one crisis contains within itself the seeds of crises to come”. Based on Harvey’s expression, this study seeks to shed light on the possible mechanisms underlying the ‘Great Recession’, and making recommendations for future works. The main reason behind this dissertation is twofold. Firstly, the study shares the belief that crises “… can be a fecund source of both personal and social change from which people emerge far better off than before. We do not always succumb to and get lost in them. We can use them creatively” (Harvey, 2015a), therefore, conceptualizing the crisis in an accurate way is pivotal. Secondly, and lastly, as Gramsci (1992) argues, the world is in an interregnum period, “the old is dying and the new cannot be born”. That is to say that, in this interregnum period, a better future will be only possible by understanding and challenging the present moment.