European Journal of Economics and Economic Policies: Intervention, 2021
The US economic expansion which began in 2009 was unusually prolonged but relatively weak. Profit... more The US economic expansion which began in 2009 was unusually prolonged but relatively weak. Profitability and investment strengthened between 2010 and 2015 but then began to falter. After Trump took office in 2017 there was a minor recovery in investment but the proceeds of major tax cuts were overwhelmingly used to finance payouts to share owners. Unemployment fell steadily from 2010 but with a shift towards lower-paid jobs. Median wages increased from around 2014, but while those for women had risen steadily since the 1980s, those for men only recuperated to their 1980 level in 2018. By contrast, top incomes soared. The impact of the COVID-19 epidemic was partly cushioned by huge government spending programmes, but unemployment among less-skilled workers increased strongly, while the massive monetary response led to an unprecedented bonanza for the rich. The Biden government's first major initiative extended unemployment benefits and promoted a national response to the health e...
Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in... more Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in 2007 and 2008. There is however a long tradition of economic analysis which emphasises how growth in a capitalist economy leads to an accumulation of tensions and results in periodic crises. This paper first reviews the work of Karl Marx who was one of the first writers to incorporate an analysis of periodic crisis in his analysis of capitalist accumulation. The paper then considers the approach of various subsequent Marxian writers, most of whom locate periodic cyclical crises within the framework of longer-term phases of capitalist development, the most recent of which is generally seen as having begun in the 1980s. The paper also looks at the analyses of Thorstein Veblen and Wesley Claire Mitchell, two US institutionalist economists who stressed the role of finance and its contribution to generating periodic crises, and the Italian Circuitist writers who stress the problematic challe...
The markets for foreign exchange, energy and residential housing have all been strongly affected ... more The markets for foreign exchange, energy and residential housing have all been strongly affected by the deregulation and expansion of the financial sector. As a result, they have begun to follow the logic of asset markets. This was especially marked in the case of the foreign exchange market from the 1970s, but has also been the case to some extent for residential housing markets since the mid-1990s, and more strongly for energy markets since the early 2000s. Deregulation has led to far greater price volatility and the rise of unsustainable price and credit bubbles which, when they burst, can pose a significant threat to financial and economic stability. For this reason, these markets should be subjected to new and appropriate forms of regulation.
Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in... more Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in 2007 and 2008. There is however a long tradition of economic analysis which emphasises how growth in a capitalist economy leads to an accumulation of tensions and results in periodic crises. This paper first reviews the work of Karl Marx who was one of the first writers to incorporate an analysis of periodic crisis in his analysis of capitalist accumulation. The paper then considers the approach of various subsequent Marxian writers, most of whom locate periodic cyclical crises within the framework of longer-term phases of capitalist development, the most recent of which is generally seen as having begun in the 1980s. The paper also looks at the analyses of Thorstein Veblen and Wesley Claire Mitchell, two US institutionalist economists who stressed the role of finance and its contribution to generating periodic crises, and the Italian Circuitist writers who stress the problematic challe...
PROKLA. Zeitschrift für kritische Sozialwissenschaft, 2001
Although the most recent US economic expansion began in 1991, rapid growth and job creation only ... more Although the most recent US economic expansion began in 1991, rapid growth and job creation only date from 1996. This faster growth was driven principally be consumer demand, but while the stock market bubble that developed from 1996 might explain spending by upperincome groups, most share holdings are small. A more significant financial factor behind the boom has been the rapid growth of borrowing by both companies and households, whose debts now stand at a record high. This borrowing has been financed by massive inflows of financial capital from abroad, and the possibility that these could turn around is the greatest threat facing the US economy as the expansion comes to an end.
Este artigo, primeiramente, descreve de forma breve o contexto da crise financeira internacional ... more Este artigo, primeiramente, descreve de forma breve o contexto da crise financeira internacional ocorrida em 2007-2008. Em seguida, passa a analisar cinco das principais abordagens que tem sido propostas para explicar a crise: a presenca generalizada de incentivos perversos; a politica monetaria expansionista do Federal Reserve; o impacto dos desequilibrios globais e o chamado “excesso de poupanca” nos paises em desenvolvimento; a extensa desregulamentacao do sistema financeiro desde a decada de 1970; e a tentativa de se gerar um retorno maior sobre todas as formas de capital e as pressoes associadas sobre os salarios. O artigo conclui com uma breve nota sobre as implicacoes politicas que decorrem de cada uma destas explicacoes.
PROKLA. Zeitschrift für kritische Sozialwissenschaft, 2007
The US economic expansion which began in 2002 has been strongly driven by consumer spending finan... more The US economic expansion which began in 2002 has been strongly driven by consumer spending financed by borrowing against sharply rising house prices. But the house-price boom came to an end in early 2006, raising fears of a new recession. Until now, house prices have stopped rising rather than actually falling, and higher employment and earnings are helping to prevent a collapse of consumption. But as earnings begin to rise, the corporate sector might find it difficult to sustain the current record levels of profitability, and if it responds by cutting back investment, this could signal the end of the current expansion.
This issue begins by presenting a “Forum on the Financial Crisis.” The financial crisis, many com... more This issue begins by presenting a “Forum on the Financial Crisis.” The financial crisis, many commentators argue, can be traced to the deregulation of the financial system pursued by the Reagan and Clinton Administrations, then continued and deepened under the Bush Administration. Trevor Evans explores this thesis, examining the patterns of economic growth and contraction since 1980. He argues that “the economic model pursued in the United States since the 1980s has resulted in a massive reconcentration of income to the benefit of those at the very top,” a process that intensified even further from 2002 until the crisis. The expansion in the scale and influence of the financial sector was critical to this development.
With global finance reshaping the world economy, this insightful new book provides a full account... more With global finance reshaping the world economy, this insightful new book provides a full account of the EU’s financial integration strategy, together with a critical assessment arguing the case for social control over global finance. Written by acknowledged experts in European finance, this book discusses key issues from finance to general social developments, encompassing social security systems, employment relations, household saving and borrowing, and the question of economic stability. Thus far, America has been pre-eminent both in global financial markets and international banking – so how should the European Union meet this challenge? Global Finance and Social Europe constructively argues that an active response is required and highlights the importance of an integrated European financial system.
In the last decade or so there have been a whole series of major financial crises, but they have ... more In the last decade or so there have been a whole series of major financial crises, but they have virtually all occurred in developing or transition economies. In the second week of August 2007, however, the US banking system was faced with a serious breakdown as ...
This survey of Marxian writing presents an analysis of the business cycle that involves both real... more This survey of Marxian writing presents an analysis of the business cycle that involves both real developments, which determine the rate of profit, and financial factors, which have an impact through the availability of credit and the rate of interest. The paper also draws on the work of recent post-Keynesians, who have developed illuminating insights into how modern capitalist financial systems function. But in contrast to the impression created by some post-Keynesians, it argues that business cycles are not just a result of financial instability, and that while it might be possible to modify or ameliorate their effects, they cannot be eliminated.
The international stock market crash which began in New York on Monday 19 October, is widely cons... more The international stock market crash which began in New York on Monday 19 October, is widely considered to have been triggered by the us Treasury Secretary Baker's threat to cancel the Louvre Accord. This agreement was made in Paris at the end of February at a ...
Trevor Evans offers a useful survey of the development of the current world financial structures.... more Trevor Evans offers a useful survey of the development of the current world financial structures. He particularly emphasises the international role of the dollar and the way in which this role has constrained domestic economic management in the us and other capitalist countries. This latter discussion then leads to a consideration of the generation and transmission of economic crisis.
European Journal of Economics and Economic Policies: Intervention, 2021
The US economic expansion which began in 2009 was unusually prolonged but relatively weak. Profit... more The US economic expansion which began in 2009 was unusually prolonged but relatively weak. Profitability and investment strengthened between 2010 and 2015 but then began to falter. After Trump took office in 2017 there was a minor recovery in investment but the proceeds of major tax cuts were overwhelmingly used to finance payouts to share owners. Unemployment fell steadily from 2010 but with a shift towards lower-paid jobs. Median wages increased from around 2014, but while those for women had risen steadily since the 1980s, those for men only recuperated to their 1980 level in 2018. By contrast, top incomes soared. The impact of the COVID-19 epidemic was partly cushioned by huge government spending programmes, but unemployment among less-skilled workers increased strongly, while the massive monetary response led to an unprecedented bonanza for the rich. The Biden government's first major initiative extended unemployment benefits and promoted a national response to the health e...
Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in... more Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in 2007 and 2008. There is however a long tradition of economic analysis which emphasises how growth in a capitalist economy leads to an accumulation of tensions and results in periodic crises. This paper first reviews the work of Karl Marx who was one of the first writers to incorporate an analysis of periodic crisis in his analysis of capitalist accumulation. The paper then considers the approach of various subsequent Marxian writers, most of whom locate periodic cyclical crises within the framework of longer-term phases of capitalist development, the most recent of which is generally seen as having begun in the 1980s. The paper also looks at the analyses of Thorstein Veblen and Wesley Claire Mitchell, two US institutionalist economists who stressed the role of finance and its contribution to generating periodic crises, and the Italian Circuitist writers who stress the problematic challe...
The markets for foreign exchange, energy and residential housing have all been strongly affected ... more The markets for foreign exchange, energy and residential housing have all been strongly affected by the deregulation and expansion of the financial sector. As a result, they have begun to follow the logic of asset markets. This was especially marked in the case of the foreign exchange market from the 1970s, but has also been the case to some extent for residential housing markets since the mid-1990s, and more strongly for energy markets since the early 2000s. Deregulation has led to far greater price volatility and the rise of unsustainable price and credit bubbles which, when they burst, can pose a significant threat to financial and economic stability. For this reason, these markets should be subjected to new and appropriate forms of regulation.
Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in... more Most mainstream neoclassical economists completely failed to anticipate the crisis which broke in 2007 and 2008. There is however a long tradition of economic analysis which emphasises how growth in a capitalist economy leads to an accumulation of tensions and results in periodic crises. This paper first reviews the work of Karl Marx who was one of the first writers to incorporate an analysis of periodic crisis in his analysis of capitalist accumulation. The paper then considers the approach of various subsequent Marxian writers, most of whom locate periodic cyclical crises within the framework of longer-term phases of capitalist development, the most recent of which is generally seen as having begun in the 1980s. The paper also looks at the analyses of Thorstein Veblen and Wesley Claire Mitchell, two US institutionalist economists who stressed the role of finance and its contribution to generating periodic crises, and the Italian Circuitist writers who stress the problematic challe...
PROKLA. Zeitschrift für kritische Sozialwissenschaft, 2001
Although the most recent US economic expansion began in 1991, rapid growth and job creation only ... more Although the most recent US economic expansion began in 1991, rapid growth and job creation only date from 1996. This faster growth was driven principally be consumer demand, but while the stock market bubble that developed from 1996 might explain spending by upperincome groups, most share holdings are small. A more significant financial factor behind the boom has been the rapid growth of borrowing by both companies and households, whose debts now stand at a record high. This borrowing has been financed by massive inflows of financial capital from abroad, and the possibility that these could turn around is the greatest threat facing the US economy as the expansion comes to an end.
Este artigo, primeiramente, descreve de forma breve o contexto da crise financeira internacional ... more Este artigo, primeiramente, descreve de forma breve o contexto da crise financeira internacional ocorrida em 2007-2008. Em seguida, passa a analisar cinco das principais abordagens que tem sido propostas para explicar a crise: a presenca generalizada de incentivos perversos; a politica monetaria expansionista do Federal Reserve; o impacto dos desequilibrios globais e o chamado “excesso de poupanca” nos paises em desenvolvimento; a extensa desregulamentacao do sistema financeiro desde a decada de 1970; e a tentativa de se gerar um retorno maior sobre todas as formas de capital e as pressoes associadas sobre os salarios. O artigo conclui com uma breve nota sobre as implicacoes politicas que decorrem de cada uma destas explicacoes.
PROKLA. Zeitschrift für kritische Sozialwissenschaft, 2007
The US economic expansion which began in 2002 has been strongly driven by consumer spending finan... more The US economic expansion which began in 2002 has been strongly driven by consumer spending financed by borrowing against sharply rising house prices. But the house-price boom came to an end in early 2006, raising fears of a new recession. Until now, house prices have stopped rising rather than actually falling, and higher employment and earnings are helping to prevent a collapse of consumption. But as earnings begin to rise, the corporate sector might find it difficult to sustain the current record levels of profitability, and if it responds by cutting back investment, this could signal the end of the current expansion.
This issue begins by presenting a “Forum on the Financial Crisis.” The financial crisis, many com... more This issue begins by presenting a “Forum on the Financial Crisis.” The financial crisis, many commentators argue, can be traced to the deregulation of the financial system pursued by the Reagan and Clinton Administrations, then continued and deepened under the Bush Administration. Trevor Evans explores this thesis, examining the patterns of economic growth and contraction since 1980. He argues that “the economic model pursued in the United States since the 1980s has resulted in a massive reconcentration of income to the benefit of those at the very top,” a process that intensified even further from 2002 until the crisis. The expansion in the scale and influence of the financial sector was critical to this development.
With global finance reshaping the world economy, this insightful new book provides a full account... more With global finance reshaping the world economy, this insightful new book provides a full account of the EU’s financial integration strategy, together with a critical assessment arguing the case for social control over global finance. Written by acknowledged experts in European finance, this book discusses key issues from finance to general social developments, encompassing social security systems, employment relations, household saving and borrowing, and the question of economic stability. Thus far, America has been pre-eminent both in global financial markets and international banking – so how should the European Union meet this challenge? Global Finance and Social Europe constructively argues that an active response is required and highlights the importance of an integrated European financial system.
In the last decade or so there have been a whole series of major financial crises, but they have ... more In the last decade or so there have been a whole series of major financial crises, but they have virtually all occurred in developing or transition economies. In the second week of August 2007, however, the US banking system was faced with a serious breakdown as ...
This survey of Marxian writing presents an analysis of the business cycle that involves both real... more This survey of Marxian writing presents an analysis of the business cycle that involves both real developments, which determine the rate of profit, and financial factors, which have an impact through the availability of credit and the rate of interest. The paper also draws on the work of recent post-Keynesians, who have developed illuminating insights into how modern capitalist financial systems function. But in contrast to the impression created by some post-Keynesians, it argues that business cycles are not just a result of financial instability, and that while it might be possible to modify or ameliorate their effects, they cannot be eliminated.
The international stock market crash which began in New York on Monday 19 October, is widely cons... more The international stock market crash which began in New York on Monday 19 October, is widely considered to have been triggered by the us Treasury Secretary Baker's threat to cancel the Louvre Accord. This agreement was made in Paris at the end of February at a ...
Trevor Evans offers a useful survey of the development of the current world financial structures.... more Trevor Evans offers a useful survey of the development of the current world financial structures. He particularly emphasises the international role of the dollar and the way in which this role has constrained domestic economic management in the us and other capitalist countries. This latter discussion then leads to a consideration of the generation and transmission of economic crisis.
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