Financial Capital and Industrial Capital. A Dichotomy that Tends to Evolve into an Antinomy

Giuseppe Garofalo and Giulio Guarini ()

European Journal of Economic and Social Systems, 2014, vol. 26, issue 1-2, 113-131

Abstract: The theoretical framework of the paper is the Veblenian theory of the business and financial cycle. Compared to similar, contemporary (K. Wicksell and I. Fisher) or later (H. Minsky and F. Vicarelli), models, the basic idea and the novelty are the identification of a gradual trend towards the financialisation of the economies. The core of the paper is represented by an econometric valuation, for OECD countries, during the period 1998-2009, that considers as regressors of investments, also a “financialisation” index concerning share and other equity of investment funds. A second econometric analysis is proposed to quantify the determinants of the process of financialisation, that in our interpretation depends also upon the relative profitability between finance sector and productive sector. The results of the analysis verify both the connection between real accumulation and financial accumulation, and the antinomy between the two sectors of an economy.

Keywords: finance and economy; investment function (search for similar items in EconPapers)
JEL-codes: B00 E22 G01 (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:ris:ejessy:0013

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