Financialization, income distribution and the crisis
By Engelbert Stockhammer. 2013
212 citations recorded by the source corpus.
The paper argues that the process of financialization has profoundly changed how capitalist economies operate. The financial sector has grown relative to the real economy and become more fragile. Non-financial businesses have adopted shareholder value orientation, which had negative effects on investment. Working class households became squeezed because of rising inequality and have become more indebted, in particular in countries with real estate bubbles. Financial globalization has given rise to growing international imbalances, which have allowed two growth models to emerge: a debt-led consumption growth model and an export-led growth model. Both should be understood as reactions to the lack of effective demand due to the polarization of income distribution. The resulting finance-dominated accumulation regime is characterized by slow and fragile growth. The crisis is best understood as the outcome of the interaction of financialization and changes in income distribution.
Subfields: Economics and Econometrics, Finance, Sociology and Political Science
View Paper: https://www.semanticscholar.org/paper/2f033244c2982f0a399bf2f43d42d35c7946b00f
How researchers see this paper
The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.
In Economics and Econometrics
- Rafael Wildauer
- Engelbert Stockhammer
- Özlem Onaran
- Till van Treeck
- Eckhard Hein
- Lucas Grafl
- P. Tridico
- Firat Demir
In Finance
- Rafael Wildauer
- Engelbert Stockhammer
- Özlem Onaran
- Till van Treeck
- Firat Demir
- Eckhard Hein
- Lucas Grafl
- Thomas Dallery
In Sociology and Political Science
Citations in the corpus
- Neoliberal growth models, monetary union and the Euro crisis. A post-Keynesian perspective (2016, unknown): “Source: Adapted from Lavoie and Stockhammer (2013). NEW POLITICAL ECONOMY 369”
- Debt-driven growth? Wealth, distribution and demand in OECD countries (2016, background): “But we also want to analyse the growth contribution of these effects, in order to determine to what extent the characterisation of growth as ‘debt-driven’ or ‘finance-led’ (Stockhammer 2012; Hein 2012b) is a useful description.”