A Keynesian–Minskian perspective on the transformation of industrial into financial capitalism

Arne Heise

Journal of Evolutionary Economics, 2023, vol. 33, issue 4, No 1, 963-990

Abstract: Abstract During the past decades, industrial capitalism has been transformed into something which has been dubbed ‘Casino Capitalism’, ‘Turbo Capitalism’ or ‘Money Manager Capitalism’ by different authors: financial accumulation has outpaced real accumulation. This process of ‘financialisation’ has been discussed quite intensively in the literature with respect to its historical determinants and its macroeconomic effects, yet it has not been studied thoroughly whether the shift from the production and allocation of commodities and services towards the origination and distribution of loans and assets as the main activity of non-financial companies challenges our theoretical principles and, therefore, demands a new macroeconomic approach. The objective of this paper is to argue in a preliminary way that financialisation is not merely to be understood as the relative growth of the financial sector based on a deepening of financial intermediation but as a structural transformation of the core business of non-financial firms. This is based on an extended post-Keynesian theory of monetary production and an application of Minskian short- and long-term instability cycles.

Keywords: John Maynard Keynes; Hyman P. Minsky; Monetary production economy; Industrial capitalism; Financial capitalism; Financial Instability Hypothesis (search for similar items in EconPapers)
JEL-codes: E12 E32 E44 E5 E60 G01 G20 N10 P16 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s00191-023-00840-8

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