Explain financialization, including the social process of it and how a household becomes involved in the financialization process

Financialization began to emerge during the Industrial Revolution and through the 20th century (and into the 21st) became highly influential in the global economic system. This term refers to the increase in the size of financial institutions and their influence and power over an economy. As large scale manufacturers emerged, the role of banks funding debt and the use of bonds to generate capital continued to expand as a larger share of the economy. During the latter half of the 20th century, household investment into stocks and the financial sector dramatically increased as defined pension plans began to be phased out and defined contribution plans such as 401k's became popular instruments to invest for retirement. In the 21st century, households invest in organizations for both retirement and general wealth building.

During the technical revolution, financialization has greatly expanded with many companies requiring years to generate positive revenue. In the 20th century, organizations that could not turn a profit in manufacturing right out of the gate or shortly after would likely fail. However, new tech companies such as Facebook, Uber, and Twitter have received massive investments from banks and investors even though many spent years without turning a profit. Financialization has allowed these types of companies to develop ideas for long periods of time without profitability, with the promise to provide greater returns in the long-run.