IDEAS home Printed from https://ideas.repec.org/a/taf/revpoe/v22y2010i2p205-233.html
   My bibliography  Save this article

Financialisation and Rising Shareholder Power in Kaleckian/Post-Kaleckian Models of Distribution and Growth

Author

Listed:
  • Eckhard Hein
  • Till Van Treeck

Abstract

We establish the link between rising shareholder power on the firm level, increasing pressure on labour, and redistribution at the expense of wages, with the macroeconomic effects on capacity utilisation, profits and capital accumulation. Three channels of transmission of 'financialisation' and increasing shareholder power, the 'preference channel', the 'finance channel' and the 'distribution channel', are introduced into two different variants of the Kaleckian distribution and growth model, the Kaleckian model and the Post-Kaleckian model. Within these models, three potential regimes of accumulation are derived, the 'contractive' regime, the 'profits without investment' regime, and the 'finance-led growth' regime. Only the 'profits without investment' regime generates a strict micro-macro identity, whereas the other two regimes are characterised by fallacies of composition, a 'paradox of accumulation' in the 'finance-led growth' regime and a 'paradox of profits' in the 'contractive' regime.

Suggested Citation

  • Eckhard Hein & Till Van Treeck, 2010. "Financialisation and Rising Shareholder Power in Kaleckian/Post-Kaleckian Models of Distribution and Growth," Review of Political Economy, Taylor & Francis Journals, vol. 22(2), pages 205-233.
    • Handle: RePEc:taf:revpoe:v:22:y:2010:i:2:p:205-233
    DOI: 10.1080/09538251003665628
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/09538251003665628
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09538251003665628?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Eckhard Hein, 2009. "‘Financialisation’ in a comparative static, stock-flow consistent post-kaleckian distribution and growth model," EKONOMIAZ. Revista vasca de Economía, Gobierno Vasco / Eusko Jaurlaritza / Basque Government, vol. 72(03), pages 120-139.
    2. Eckhard Hein & Torsten Niechoj & Heinz-Peter Spahn & Achim Truger (ed.), 2008. "Finance-led Capitalism? Macroeconomic Effects of Changes in the Financial Sector," Conference proceedings of the Research Network Macroeconomics and Macroeconomic Policies (FMM), IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute, volume 11, number 11-2008.
    3. Dorothy Power & Gerald Epstein, 2003. "Rentier Incomes and Financial Crises: An Empirical Examination of Trends and Cycles in Some OECD Countries," Working Papers wp57, Political Economy Research Institute, University of Massachusetts at Amherst.
    4. Eckhard Hein, 2008. "Money, Distribution Conflict and Capital Accumulation," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-59560-6.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eckhard Hein & Christian Schoder, 2011. "Interest rates, distribution and capital accumulation -- A post-Kaleckian perspective on the US and Germany," International Review of Applied Economics, Taylor & Francis Journals, vol. 25(6), pages 693-723, November.
    2. Hein, Eckhard, 2011. "Distribution, ‘Financialisation’ and the Financial and Economic Crisis – Implications for Post-crisis Economic Policies," MPRA Paper 31180, University Library of Munich, Germany.
    3. Eckhard Hein, 2010. "Shareholder Value Orientation, Distribution And Growth—Short‐ And Medium‐Run Effects In A Kaleckian Model," Metroeconomica, Wiley Blackwell, vol. 61(2), pages 302-332, May.
    4. Sarah Godar & Christoph Paetz & Achim Truger, 2015. "The scope for progressive tax reform in the OECD countries. A macroeconomic perspective with a case study for Germany," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(5), pages 79-117.
    5. Parui, Pintu, 2020. "Corporate Debt, Rentiers' Portfolio Dynamics, Instability and Growth: A neo-Kaleckian Perspective," MPRA Paper 102870, University Library of Munich, Germany.
    6. Eckhard Hein, 2012. "The Macroeconomics of Finance-Dominated Capitalism – and its Crisis," Books, Edward Elgar Publishing, number 14931.
    7. Achim Truger, 2013. "Steuerpolitik im Dienste der Umverteilung: eine makroökonomische Ergänzung," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 82(1), pages 43-59.
    8. Engelbert Stockhammer & Paul Ramskogler, 2009. "Post-Keynesian economics How to move forward," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 6(2), pages 227-246.
    9. Eckhard Hein & Daniel Detzer, 2015. "Finance-Dominated Capitalism and Income Distribution: A Kaleckian Perspective on the Case of Germany," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 1(2), pages 171-191, July.
    10. Joel Rabinovich & Niall Reddy, 2024. "Corporate Financialization: A Conceptual Clarification and Critical Review of the Literature," Working Papers PKWP2402, Post Keynesian Economics Society (PKES).
    11. Eckhard Hein, 2015. "Finance-dominated capitalism and re-distribution of income: a Kaleckian perspective," Cambridge Journal of Economics, Oxford University Press, vol. 39(3), pages 907-934.
    12. Thomas Palley, 2023. "Theorizing Varieties of Capitalism: economics and the fallacy that 'there is no alternative (TINA)'," Chapters, in: Thomas Palley & Esteban Pérez Caldentey & Matías Vernengo (ed.), Varieties of Capitalism, chapter 1, pages 1-38, Edward Elgar Publishing.
    13. David Felix, 2003. "The Past as Future? The Contribution of Financial Globalization to the Current Crisis of Neo-Liberalism as a Development Strategy," Development and Comp Systems 0310002, University Library of Munich, Germany.
    14. Peter Skott, 2011. "Heterodox macro after the crisis," UMASS Amherst Economics Working Papers 2011-23, University of Massachusetts Amherst, Department of Economics.
    15. repec:ilo:ilowps:470932 is not listed on IDEAS
    16. Eckhard Hein & Achim Truger, 2011. "Fiscal Policy in the Macroeconomic Policy Mix: A Critique of the New Consensus Model and a Comparison of Macroeconomic Policies in France, Germany, the UK and Sweden from a Post-Keynesian Perspective," Chapters, in: Claude Gnos & Louis-Philippe Rochon (ed.), Credit, Money and Macroeconomic Policy, chapter 12, Edward Elgar Publishing.
    17. Coskun, Yener, 2011. "Does Power of Political Economy and Regulation Make Istanbul a Financial Center? (Ekonomi Politik ve Düzenlemenin Gücü Istanbul’u Finans Merkezi Yapabilir Mi?) [Does Power of Political Economy and ," MPRA Paper 36847, University Library of Munich, Germany.
    18. Eckhard Hein & Valeria Jimenez, 2022. "The macroeconomic implications of zero growth: a post-Keynesian approach," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 19(1), pages 41-60, April.
    19. repec:ilo:ilowps:485244 is not listed on IDEAS
    20. Eckhard Hein & Achim Truger, 2012. "Finance-dominated capitalism in crisis—the case for a global Keynesian New Deal," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 35(2), pages 187-213.
    21. repec:ilo:ilowps:470913 is not listed on IDEAS
    22. Eckhard Hein, 2013. "The crisis of finance-dominated capitalism in the euro area, deficiencies in the economic policy architecture, and deflationary stagnation policies," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 36(2), pages 325-354.
    23. Botta, Alberto & Caverzasi, Eugenio & Tori, Daniele, 2020. "The Macroeconomics Of Shadow Banking," Macroeconomic Dynamics, Cambridge University Press, vol. 24(1), pages 161-190, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:revpoe:v:22:y:2010:i:2:p:205-233. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CRPE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.