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on Post Keynesian Economics |
| By: | Kohler, Karsten (Kingston University London); Guschanski, Alexander (University of Greenwich); Stockhammer, Engelbert (Kingston University London) |
| Abstract: | It is frequently asserted that financialisation has contributed to the decline in the wage share. This paper provides a theoretical clarification and a systematic empirical investigation. We identify four channels through which financialisation can affect the wage share: (1) enhanced exit options of firms; (2) rising price mark-ups due to financial overhead costs for businesses; (3) increased competition on capital markets and shareholder value orientation; and (4) the role of household debt in increasing workers’ financial vulnerability and undermining their class consciousness. The paper compiles a comprehensive set of empirical measures of financialisation and uses it to test these hypotheses with a panel regression of 14 OECD countries over the 1992-2014 period. We find strong evidence for negative effects of financial liberalisation and financial payments of non-financial corporations on the wage share that are in the same order of magnitude as the effects of globalisation. |
| Keywords: | financialisation; income distribution; political economy |
| JEL: | E25 |
| Date: | 2018–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kngedp:2018_001&r=pke |
| By: | Foster, John |
| Abstract: | The behaviour of aggregate consumption is conventionally understood from the perspective of the permanent income and life cycle hypotheses. Both of these hypotheses are deduced from the theory of constrained optimization as applied to a ‘representative agent’ that consumes and saves. An alternative way of understanding aggregate consumption expenditure is to see it as primarily a systemic outcome of the adoption of widely upheld rules (‘meso-rules’) that enable trading and contracting in a complex economic system. Such systems require order to function but they must also adapt and evolve. Correspondingly, aggregate consumption can be viewed as being determined by two contrasting historical processes: one involves an aggregation of pre-committed, rule-bound choices and the other open-ended aspirational choices of novel products. Both of these processes are influenced by economic incentives. This is the domain of neoclassical economic theory and it is found that such theorising can tell us a great deal once it is set in its proper historical context. Although a modern complex system perspective derived from the natural sciences is adopted, it is embedded in economic thinking. For example, connections are made to the insights and intuitions of Alfred Marshall, Joseph Schumpeter, Simon Kuznets, Friedrich Hayek and Maynard Keynes. What we understand from them, along with modern complex system analysis, is that, although it is individual decisions that are fundamental in any economic system, it cannot be the case that what we observe at the aggregate level just reflects the optimization decision of a representative agent. As Hayek observed, the role of individual is much more complex and important than this. Using half a century of data, the US consumption function is modelled successfully on the presumption that the economy is a complex system in which there has been the diffusion of a ‘culture of consumerism’ in the post-war era. This has involved the increasing adoption of a particular bundle of meso rules and this has resulted in a steadily increasing ratio of consumption to GDP that has been tending towards a limit. It was found that variables and perspectives drawn from neoclassical economic theory are important in explaining variations in the growth of aggregate consumption. |
| Keywords: | consumption function, macroeconomics, US |
| JEL: | E0 E00 E1 E10 E2 E21 E6 E60 |
| Date: | 2018–02–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:84383&r=pke |
| By: | Leonardo Ferreira Guimarães |
| Abstract: | This working paper focusses on a rigorous and somewhat idiosyncratic exposition of the concepts of dialectics, determinations of reflection (or essentialities) and social forms, adopting a Marxist reading of Hegel’s Science of Logic. The objective of this focus is to address one of the elements highly common in debates between Marxists and post-structuralists e amongst Marxist themselves: the centrality of categories of the one (like Universality, necessity, identity and so on) or of the multiple (like particularity, contingency, difference etc). Hence, the focus of this work is on the centrality of reflexive or mutual determinations (essence, non-identical identity, contradictory unity and social forms). Initially, even though Marx and some Marxist authors had used the notion of social forms, none of them had this notion developed in itself. The specific developments of this notion: such as the value forms, commodity form, political and juridical social forms were explored by various authors and by Marx himself. But, in the literature review made for this research, it wasn’t found any conceptualization of the general notion. The concept of social form can be explored as a methodological resource to mediate those above-mentioned elements of the debates. For instance, to centralize the social forms is to centralize the negative and reflexive element when we discuss if it’s the capital and its tendency laws that make for the historical march or the class struggle and the political contingency. The focus is on the something that exists in-between, the objectivation process in itself, not in its extremes |
| Keywords: | Dialectics; Marxist method; Social Forms; Political Economy; Hegel-Marxrelation |
| JEL: | B40 B49 B51 |
| Date: | 2017–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:spa:wpaper:2017wpecon36&r=pke |