The Great Financial Meltdown M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 NEW DIRECTIONS IN MODERN ECONOMICS Series Editor: Malcolm C Sawyer, Professor of Economics, University of Leeds, UK New Directions in Modern Economics presents a challenge to orthodox economic thinking It focuses on new ideas emanating from radical traditions including post-Keynesian, Kaleckian, neo-Ricardian and Marxian The books in the series not adhere rigidly to any single school of thought but attempt to present a positive alternative to the conventional wisdom For a full list of Edward Elgar published titles, including the titles in this series, visit our website at www.e-elgar.com M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 The Great Financial Meltdown Systemic, Conjunctural or Policy Created? Edited by Turan Subasat Department of Economics, Mugla Sitki Kocman University, Turkey NEW DIRECTIONS IN MODERN ECONOMICS Cheltenham, UK • Northampton, MA, USA M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 © Turan Subasat 2016 All rights reserved No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher Published by Edward Elgar Publishing Limited The Lypiatts 15 Lansdown Road Cheltenham Glos GL50 2JA UK Edward Elgar Publishing, Inc William Pratt House Dewey Court Northampton Massachusetts 01060 USA A catalogue record for this book is available from the British Library Library of Congress Control Number: 2016931499 This book is available electronically in the Economics subject collection DOI 10.4337/9781784716493 ISBN 978 78471 648 (cased) ISBN 978 78471 649 (eBook) 02 Typeset by Servis Filmsetting Ltd, Stockport, Cheshire M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 To those who died for peace and democracy in Turkey M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 Contents List of contributorsix Acknowledgementsxvi List of abbreviationsxvii PART I INTRODUCTION The crisis in context Turan Subasat 2 Roots of the current economic crisis: capitalism, forms of capitalism, policies and contingent events David M Kotz 18 PART II CRISIS AND PROFITABILITY Crisis theory and the falling rate of profit David Harvey Monocausality and crisis theory: a reply to David Harvey Michael Roberts 5 Booms, depressions and the rate of profit: a pluralist, inductive guide Alan Freeman 37 55 73 PART III THE CRISIS IN ECONOMIC AND SOCIAL REPRODUCTION A global approach to the global financial crisis John Weeks 7 The incubator of the great meltdown of 2008: the structure and practices of US neoliberalism as attacks on labor Al Campbell and Erdogan Bakir The value of history and the history of value Radhika Desai The systemic failings in framing neoliberal social policy Ben Fine 97 116 136 159 vii M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 viii The great financial meltdown 10 The policy-based and conjunctural causes of the 2008 crisis Turan Subasat 11 The systemic causes of the 2008 crisis: an alternative theoretical perspective Turan Subasat 178 198 PART IV CRISIS AND FINANCE 12 Inequality, money markets and crisis 217 Simon Mohun 13 The crisis of finance and the crisis of accumulation: it was not a ‘Lehman Brothers moment’ 236 Jan Toporowski 14 Contradictions of capital accumulation in the age of financialization248 Özgür Orhangazi 15 Which crisis, of which capitalism? A Marxian and financial Keynesian interpretation of neoliberalism and the great recession266 Riccardo Bellofiore 16 The contested nature of financialization in emerging capitalist economies287 Annina Kaltenbrunner and Elif Karacimen PART V THE CRISIS UNFOLDS 17 The Greek crisis: structural or conjunctural? Stavros D Mavroudeas 18 Greece, global fault-lines and the disintegrative logics of Germany’s primacy in Europe Vassilis K Fouskas 19 Conclusions John Weeks 307 328 341 Index345 M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 Contributors Erdogan Bakir received his BS and MS from the Middle East Technical University in Ankara, Turkey and his PhD from the University of Utah, USA In 2006–2007, he held a Swedish Institute postdoctoral scholarship at the Gothenburg University in Sweden He has been teaching at the Bucknell University in Lewisburg, USA since 2008 His research, which focuses on business cycles and the neoliberal form of capitalism in the USA, has been published in political economy journals including the Review of Radical Political Economics, Science and Society and Journal of Economic Issues Riccardo Bellofiore is a professor at the University of Bergamo, Italy He teaches advanced macroeconomics, history of economic thought, monetary economics and international monetary economics His research interests include capitalist contemporary economy, endogenous monetary approaches, Marxian theory and the philosophy of economics Among his recent publications are: ‘Crisis Theory and the Great Recession: A Personal Journey, from Marx to Minsky’ (Research in Political Economy, 2011); ‘“Two or Three Things I Know about Her”: Europe in the Global Crisis, and Heterodox Economics’ (Cambridge Journal of Economics, 2013); and with Francesco Garibaldo and Mariana Mortagua, ‘A Credit- Money and Structural Perspective on the European Crisis: Why Exiting the Euro is the Answer to the Wrong Question’ (Review of Keynesian Economics, 2015); and five co- edited books: with Giovanna Vertova, The Great Recession and the Contradictions of Contemporary Capitalism (Edward Elgar Publishing, 2014); with Scott Carter, Towards a New Understanding of Piero Sraffa Insights from Archival Research (Palgrave Macmillan, 2014); with Guido Starosta and Peter Thomas, In Marx’s Laboratory Critical Interpretations of the Grundrisse (Leiden, 2013); and with Ewa Karwowska and Jan Toporowski, two volumes in honour of Tadeusz Kowalik: The Legacy of Rosa Luxemburg, Oskar Lange and Michal Kalecki (Palgrave Macmillan, 2014) and Economic Crisis and Political Economy (Palgrave Macmillan, 2013) Al Campbell is a retired Emeritus Professor of Economics from the University of Utah, USA, currently living in Bern, Switzerland He is a ix M3967 SUBASAT 9781784716486 PRINT.indd 24/05/2016 14:14 Greece, global fault-lines and Germany’s primacy in Europe 339 Busch, K (1978), Die Krise der Europäischen Gemeinschaft, Hamburg: Europaische Verlagsanstalt Chase, James (1999), Acheson The Secretary of State that Created the American World, New York: St Martin’s Press Darvas, Z et al (2011), ‘A Comprehensive Approach to the Euro-Area Debt Crisis’, Brussels: Bruegel, accessed 16 January 2013 at https://ideas.repec.org/p/ mkg/wpaper/1101.html Duncan, R (2012), ‘A New Global Depression’, New Left Review, 77, 1–21 Fine, B (2010), ‘Locating Financialisation’, Historical Materialism, 18, 97–116 Fouskas, V.K (1997), ‘The Left and the Crisis of the Third Hellenic Republic, 1989–1997’, in D Sassoon (ed.), Looking Left, London: I.B Tauris Fouskas, V.K (1998), Italy, Europe, the Left: The Transformation of Italian Communism and the European Imperative, Aldershot: Ashgate Fouskas, V.K and C Dimoulas (2012), ‘The Greek Workshop of Debt and the Failure of the European Project’, Journal of Balkan and Near Eastern Studies, 14(1), 1–33 Fouskas, V.K and C Dimoulas (2013), Greece, Financialization and the EU The Political Economy of Debt and Destruction, New York, USA and London, UK: Palgrave Macmillan Fouskas, V.K and B Gökay (2005), The New American Imperialism: Bush’s War on Terror and Blood for Oil, Westport, CT: Praeger Fouskas, V.K and B Gökay (2012), The Fall of the US Empire Global Fault-lines and the Shifting Imperial Order, London: Pluto Press Frank, A.G (1972), Lumpenbourgeoisie, Lumpendevelopment, New York: Monthly Review Press Freris, A (1986), The Greek Economy in the 20th Century, London, UK and Sydney, Australia: Croom Helm Glyn, A (2007), Capitalism Unleashed, Oxford: Oxford University Press Gowa, J (1983), Closing the Gold Window Domestic Politics and the End of Bretton Woods, New York: Ithaca Gowan, P (1999), The Global Gamble Washington’s Faustian Bid for World Dominance, London: Verso Hobsbawm, E (1995), Age of Extremes, London: Abacus Lapavitsas, C (2013), Profiting without Producing How Finance Exploits us All, London: Verso Lapavitsas, C et al (2010), ‘Euro-zone Crisis: Beggar Thyself and Thy Neighbour’, Journal of Balkan and Near Eastern Studies, 2(4), 330–368 Michalopoulos, G (2012), Financing Greek Banks during the Crisis, Athens: Alpha Bank Mundell, R (1961), ‘A Theory of Optimum Currency Area’, American Economic Review, 51(4), 657–665 Pagoulatos, G and C Triantopoulos (2009), ‘The Return of the Greek Patient: Greece and the 2008 Global Financial Crisis’, South European Society and Politics, 14(1), 45–58 Palloix, C (1975), L’ internationalisation du capital, Paris: F Masperó Poulantzas, N (1974), Les classes sociales dans le capitalism aujourd’hui, Paris: F. Masperó Sassoon, D (1986), Contemporary Italy, London: Longman Sassoon, D (1996), One Hundred Years of Socialism, London: I.B Tauris SIPRI (2012), SIPRI website, www.sipri.org (accessed December 2013) M3967 SUBASAT 9781784716486 PRINT.indd 339 24/05/2016 14:14 340 The great financial meltdown Stockhammer, E (2013), ‘Financialization and the Global Economy’, in H.M. Wolfson and G.A Epstein (eds), The Political Economy of Financial Crises, Oxford: Oxford University Press Tolios, Y (2011), Crisis, ‘Odious’ Debt and Violation of Payments, Athens: Topos (in Greek) Union of Greek Banks (2011), The Greek Banking System, Athens: UGB Wolf, M (2013), ‘The Toxic Legacy of the Greek Crisis’, Financial Times, 18 June Wolfson, M.H and A.G Epstein (eds), The Political Economy of Financial Crises, Oxford: Oxford University Press M3967 SUBASAT 9781784716486 PRINT.indd 340 24/05/2016 14:14 19. Conclusions John Weeks Towards the end of 2007 the United States (US) economy suffered a wave of financial instability that would intensify and in 2008 result in the most severe contraction of aggregate output since the 1930s The gathering economic disaster in the United States quickly spread to Europe and Japan While a few predicted that the US ‘boom’ of the late 1990s and into the 2000s would at some point come to a crashing halt, it is doubtful that even modern-day Cassandras anticipated the disaster that unfolded The contributors to this book have discussed, analysed and debated the causes and consequences of the great contraction Appearances suggest that the world economy has entered a sustained if slow and long-delayed recovery Stagnation persisted for many advanced capitalist countries and spread to the middle-income countries including the cliché-ridden BRICS countries (Brazil, Russia, India, China, South Africa) This prolonged global stagnation has manifested itself most obviously among the eurozone countries, whose collective performance since 2008 has been inferior to that of not only the United States and the United Kingdom, but also long-floundering Japan An issue raised in this book is whether the behaviour of each country and region represents individual recessions derivative from the collapse of the US economy, or a generalized, global phenomenon Whether the post-2008 economic environment reflects a series of local contractions adding to a global downturn, or a global contraction successively manifested as local downturns, is closely related to whether we have lived through a ‘crisis of capitalism’ All the authors agree that the end of the 2000s brought forth a ‘crisis of capital’ in almost every advanced country Taken together, the richness of the contributions derives from differences in interpretation of causality In the past, Marxist debates over the cause of severe economic contractions revolved around three approaches The so-called ‘profit squeeze’ hypothesis attracted many supporters in the 1960s and 1970s According to this hypothesis, economic contractions result from the success of the working class in the distributional struggle Whatever might be the 341 M3967 SUBASAT 9781784716486 PRINT.indd 341 24/05/2016 14:14 342 The great financial meltdown theoretical strengths and weaknesses of this causal mechanism, the sharply rising profit share in almost every advanced country over the last 30 years prompts authors to reject this mechanism A second line of argument focuses on inadequacy of aggregate demand due to the failure of private investment to match private saving (sometimes inaccurately called ‘underconsumption’) In this context closely related themes run through this volume, indicating both agreement and differences both across chapters and in the wider community of Marxist scholars Perhaps the most obvious tension arises from the term ‘neoliberalism’, its conceptual status and its role in the emergence of the global crisis The uses of the concept fall into three categories First, the term can refer to a set of policies introduced by and in the interest of capital in its struggle to weaken the economic and political power of the working class, and/or multi-class progressive social movements Second, and a variation on the first, neoliberalism is a policy specific to the interests of financial capital and, therefore, creates the policy environment for the financialization of economic life, as well as making a change in the nature of accumulation A third approach among the authors in this volume rejects the interpretation that neoliberalism is a policy, viewing it as a more profound and transformative phenomenon that cannot be reversed by changes in a policy framework While few in this book or in the wider community of Marxian scholars consider neoliberalism as a new mode of production, this third approach considers it to signal a different stage of capitalist development in that it alters the capitalist social structure or social formation This formulation implies that the potential to reverse the neoliberal trend through existing bourgeois democratic institutions is extremely limited Closely linked to neoliberalism in all three approaches is its anti- democratic nature This manifests itself on several levels In the sphere of economic policy, neoliberal ideology justified removing the basic instruments of economic management from democratic accountability Concretely, this involves: (1) ‘independence’ of central banks to ‘insulate’ them from political ‘interference’; (2) legislative or even constitutional mandates for balanced budgets (most extreme among the countries of the European Union); and (3) so-called floating exchange rates, to eliminate the principal instrument for short-term management of the external balance Taken together, this ‘decommissioning’ of macroeconomic policy liberates financial capital to manage the economy without democratic constraint The more fundamental anti-democratic nature of neoliberalism is manifested in its assault on trade unions throughout the globe, and especially in the United States, the United Kingdom and in several countries of the M3967 SUBASAT 9781784716486 PRINT.indd 342 24/05/2016 14:14 Conclusions 343 eurozone Several chapters analyse this in the US context, linking it to the rising power of finance In some chapters the attack on the organizations of the working class is viewed more narrowly as primarily an attempt to raise profits We find no disagreement with the conclusion that the decline of trade union influence in the working class and in politics is an integral part of neoliberalism A theme with the strongest consensus in this book and among Marxists more generally is that capitalist economies have an inherent tendency to instability varying from mild fluctuations to severe crises It is doubtful that any Marxist would disagree with that conclusion For decades neoclassical economics has denied this instability, what Keynesians called the ‘business’ or ‘trade cycle’ The reader finds considerably less agreement on the cause of the instability and, therefore, its nature Almost by definition, during every contraction of a capitalist economy we initially observe a fall in total profits and the rate of profit However, establishing the causal link from profits to instability has vexed Marxists for more than a century The chapters in this book provide analytical and empirical examples of substantially different interpretations of the profit–instability interaction The differences have several dimensions, and the authors consider one of the more vexing: measurement As is made clear in several chapters, in capitalism we not ‘get what we see’ On the contrary, social and economic relations in capitalist society are distorted and frequently hidden by the act of exchange This is especially true for profits Marx famously wrote to Engels that one of the two best points in his book was ‘the treatment of surplus value independently of its particular forms as profits, interest, ground rent, etc’ By this Marx meant that exchange generates an observed or exoteric form (profit of enterprises) derivative from an esoteric or hidden form (surplus value) The majority opinion among the authors, though not a consensus, is that instability and crises result from changes in the esoteric form, surplus-value Because surplus-value cannot be directly observed, it is not surprising that controversy rages over how to measure it The different measures used in this book provide insight into each author’s analytical method Closely related to the measurement of profit is its division between capital of enterprise and financial capital The theoretical basis of the productive and unproductive labour dichotomy is not explicitly pursued in this volume However, a consensus exists across the chapters that financial capital is unproductive in the strict sense that the labour it employs does not create value, and therefore does not generate surplus-value The argument that finance is unproductive lies at the heart of discussions of financialization, another major theme in this volume However M3967 SUBASAT 9781784716486 PRINT.indd 343 24/05/2016 14:14 344 The great financial meltdown one might define this concept, we have unanimity that the 2007–08 crisis of capital in the advanced countries was a financial collapse For this reason several chapters explore the intricacies of financial capital Out of this discussion comes the conclusion that policy changes reduced the constraints on financial capital in its parasitic appropriation of surplus-value Whatever the causal mechanism authors use to explain the crisis, all agree that financialization made the collapse more extreme By extension comes the theme that the growing dominance of finance in part explains the slowness of recovery One of the strengths of the volume is the near absence of causality mechanisms that rely on economic variables only Of the many characteristics that distinguish Marxian analysis from neoclassical economics is the inseparable interaction of the forces and relations of production Quite strong is the theme that the global crisis cannot be understood without reference to changes in the relations between capital and labour Too often, Marxian analysis has tended to consider capitalism from a purely economic perspective, stressing perceived inherent and mechanical processes without reference to social relations The chapters in this book not take that reductionist approach Often critics accuse Marxists of two major analytical transgressions: (1) packaging what are essentially mainstream arguments in the language of Capital; and (2) retreating to the safety of purely theoretical formulations in order to disguise an inability to treat the concrete, ‘reality’ The authors in this book refute both accusations The reader will find no ‘Marxology’ here; that is, construction of faux arguments by extensive quotations from Capital and other works by Marx The authors’ success in applying aspects of the analytical framework derivative from Marx is demonstrated in both the arguments themselves and their variety Cynics might dismiss this variety and differences as evidence of the absence of a core framework from which to derive rigorous analysis The truth is quite the contrary The monolithic pedantry of mainstream economics serves a disciplining role, because those who move outside it find themselves marginalized and even expelled from the profession By contrast, the differences among those writing in the Marxian tradition demonstrate openness to new ideas and tolerance for dissent To put it simply, the neoclassical economists are the rigid ideologues, while Marxists thrive on theoretical differences That is a central message of this book M3967 SUBASAT 9781784716486 PRINT.indd 344 24/05/2016 14:14 Index 217, 259, 261–2, 273, 278–9, 301, 314, 316, 320 asset 8, 22, 24, 27–9, 33, 129, 147–8, 151, 213, 261–2, 278 financial 11, 14, 152, 179, 184, 316, 320 housing 6, 22–4, 132, 152–3, 194 Bukharin, N 55, 138 Bureaucracy 16 Business corporations 12, 241 Accelerator 11, 257 Advanced capitalist countries 15, 73, 112, 237, 287, 341 Africa 52, 328, 331 Agency perspective 16, 334 Aggressive competition 267 Anglo-American 14, 16, 152, 332–3, 336–7 Arestis, P 329 Argentina 109, 197, 297 Asia 16, 52, 112, 153, 177, 192, 328–31, 334 Asia Minor 328 Bakir, E 7, 14, 116, 119–20, 124, 132–3, 179, 263 Balance of payments 9, 16, 113, 178, 194, 233, 278, 280, 329, 333–5, 338 Bank for International Settlements 300 Baran, P 56, 270 Baranowski, T 137, 140, 144 Bellofiore, R 7, 11, 13, 113, 208, 246, 266, 280, 282–3, 285 Blanchard, O 73–4, 312 Bleaney, M.F 212 Bolivia 50 Borrowing 8, 11–13, 17, 22–3, 100, 108, 124, 128, 192–3, 195, 199, 220, 233, 236, 238, 243, 261, 276, 278, 295, 297, 310, 312, 315, 334–5 Brazil 109, 148, 197, 205, 292, 294, 296–8, 331, 341 Brenner, R 119, 143, 146–8, 150–51, 253, 287, 330–31 Bretton Woods 9, 14, 16, 150, 152, 221 BRICS 331, 341 Britain 41, 45, 61, 150, 166, 278, 336 Bubbles 6, 8, 10–11, 13–14, 22–4, 27–9, 33, 67, 121, 127–30, 132, 145, 147–8, 151–4, 178–9, 181, 184, 187–8, 190–91, 193–4, 196, 213, Campbell, A 7, 14, 116, 119, 120, 124, 131, 179, 263 Capacity utilization 23, 29, 32–3, 83, 90, 213 Capital accumulation 3–4, 6, 10, 12–13, 19–20, 25, 27–8, 31, 38–9, 44, 46, 48, 53, 62, 68, 78, 84, 101, 124, 129, 132, 144, 198, 203–6, 208–12, 236–7, 240–41, 243, 245, 248–9, 251–3, 255–9, 261–2, 264, 268, 270, 287–9, 291, 294–5, 297–9, 319–20, 323 circuit of 8, 15, 67, 97–8, 100, 110–11, 144, 200, 232, 237, 307, 309, 319, 325 constant 5, 7, 37, 41–2, 47, 60, 63, 65, 100, 146–7, 199, 207, 213, 268 devaluation of 5, 41–3, 45, 65, 76, 269 fictitious 49, 86, 101, 323–4, 330 financial 14, 88, 111, 113, 147, 184, 249–50, 256–8, 262, 282, 330, 337, 342–4 international flows 138, 152–3, 155 markets 11, 232–3, 236, 238–9, 242–4, 246, 267, 277, 280, 290, 292, 296, 318 345 M3967 SUBASAT 9781784716486 PRINT.indd 345 24/05/2016 14:14 346 The great financial meltdown money 14, 47, 65, 88, 113, 255–6, 271, 299, 324 moral depreciation of 3, 82, 210, 212 non-financial 252, 254 organic composition of 5–8, 47, 58, 62–4, 82, 100, 102, 144, 180, 209, 269, 320 productive 12, 14, 110, 113, 124, 127, 184, 238, 249–51, 258, 299, 318, 324 value, composition of 7, 37, 63, 268–70 variable 5, 37, 47, 63, 199–200, 268–9 Capitalism, 4–6, 8–14, 18–22, 24–33, 37–9, 42–6, 52–3, 55–8, 61–2, 67–9, 74, 78–80, 83–5, 88–90, 97, 99–101, 112–13, 116, 121–5, 127–31, 134, 136, 138–41, 143–4, 146–7, 150–52, 154, 158–9, 165, 167, 173–4, 177, 184, 189, 204, 212–13, 215, 218, 237, 241–6, 250, 253–5, 257–60, 263, 271–2, 274–4, 286–90, 292, 294, 312–14, 318–19, 321–3, 325–7, 328–9, 330, 336, 339, 344, 346, 348–9 Capitalism-in-general 4, 8, 18–22, 29–30, 33 Carchedi, G 37, 56, 58, 60, 64–5, 69–70, 77, 80, 139, 212 Centralization 43, 250, 267, 276, 283, 298 Chief executive officer (CEO), 26–28, 118, 120, 125, 233 Chile 295–7 China, 9, 16, 33, 42, 45, 49, 50, 52, 75, 89, 107, 109–11, 148, 178, 188, 192, 194, 196–7, 242, 254, 260, 276, 280–81, 292, 295, 297, 324, 329, 331, 341 Clarke, S 140, 213 Class 16, 21, 25–6, 31, 38, 47, 88, 90, 131–2, 136, 138, 141, 143–6, 147, 150–51, 154, 169–70, 179, 198, 225–6, 151, 256, 275, 283–4, 294, 300, 310, 318, 325, 328, 331, 334 analysis 88 capitalist 3, 13, 88, 151, 179, 224, 268, 274, 288, 295 conflict 271, 299 financial 14 M3967 SUBASAT 9781784716486 PRINT.indd 346 interest 44 landlord 38 leisure 138 middle 132, 277, 338 profit share 11, 225–6 rate of profit 7, 224–5 relations 3–4, 9, 21, 25, 89, 179 rentier 14, 89, 138 ruling 155 struggle 4, 46, 111, 130, 143–4, 151, 155, 179, 212–13, 223, 266–7, 315 working 5, 8–9, 31, 44, 46, 117, 125, 128–30, 138, 148–51, 154, 168, 187, 223, 225, 276, 280, 283, 341–3 Collateralized debt obligations 23, 70, 229, 230, 333 Competitive exchange rate 9, 178, 194 Competitiveness 182, 186, 192, 194–5, 279, 310, 313–16, 321–6, 332, 334 Complementary 11–12, 102, 160, 170, 277 Comprador 16–17, 334–6, 338 Concentration 170, 250, 267, 276, 283 Conjunctural 3–4, 6, 9, 15, 40, 45, 53, 56–7, 103, 178, 193, 195–6, 198, 307–10, 324 Constant capital 5, 7, 37, 41–2, 47, 60, 63, 65, 100, 146–7, 199, 207, 213, 268 Consumer spending 8, 23–4, 27, 29, 33, 213 Consumption 5, 8–10, 13, 16, 24, 44, 65–6, 98, 101, 113, 128, 138–40, 146–50, 154–5, 191, 197–209, 212–13, 219, 225, 245, 261, 267–8, 270, 272, 276–8, 281, 283, 291, 300, 310, 314, 318, 320–21, 323, 330, 332–3, 335–6 Contingent events 4, 18–22, 30, 179 Contradictions of capitalism 4, 18, 20, 31, 179, 210, 236 Core 16–17, 87, 147, 182–4, 194, 196, 213, 240, 259–60, 279, 289–90, 293, 296–7, 299, 309, 311–12, 314–16, 323, 330–35, 337–8, 344 Corporate capitalism 11–12, 249 finance 12, 236, 239, 241, 243 24/05/2016 14:14 Index 347 governance 117, 123–4, 127–9, 132–4, 267, 276, 282 Counteracting influences 41, 69 tendencies 37, 41, 55, 59–61, 63 Credit card 13, 49, 196, 229, 276 Credit squeeze 13, 238, 273 Creditor class 275 Crisis Asian 101, 109, 153, 178, 194, 292 Economic 3, 18–21, 23–4, 67, 98, 101, 140, 146, 154, 159, 243, 308–309, 322 Eurozone / Euro 108, 194, 196, 212, 335–6 Financial 8–9, 11, 14–15, 21, 24, 30, 40–41, 46, 67, 97, 100–102, 106, 109, 111, 153–4, 178–82, 184–9, 191, 193, 195–7, 217–18, 232, 236, 238, 241, 245, 248, 257, 275, 288–9, 293, 295–7, 299, 308, 313–14, 318, 329–30, 333, 336–7 Fiscal 145, 147, 330, 338 Global financial 102, 106, 111, 289, 299, 318, 333, 337 Greek 15, 279, 307–11, 313, 315, 317–9, 321, 325–6, 329 of accumulation 3, 12, 44, 97–8, 144, 236, 241 of deregulation 11, 236 Oil 3, 193 tendencies 8, 18–20, 25–7, 29, 31, 33, 44, 53, 143, 213, 309 theory/theories 4, 19, 34, 37, 39–41, 55–7, 68, 80, 113, 146, 179, 268, 270, 282, 307–8, 319 Crotty, J 251, 257, 259, 263, 287 Crude oil prices 9, 193, 196 Currency unions 16, 336 Current account balance, 189, 196–7 deficit 10, 15–17, 153, 178–9, 181, 185, 187–8, 191–8, 311–16, 324, 335 surplus 178, 188, 190, 192–4, 196, 278 Debt driven growth 16, 333, 336 M3967 SUBASAT 9781784716486 PRINT.indd 347 household 15, 23, 128–9, 181, 191, 211, 213 public 13, 271, 275, 279, 284, 292–3 structures 11, 236–7 Demand aggregate 12, 25, 27, 102, 122, 129, 146, 212, 214, 240, 243, 256, 258, 262–3, 334, 342 deficiency 10, 181, 198–199, 200–209, 211, 259 Deregulation 3, 9, 11, 25, 27, 28, 30, 88, 112, 131, 178–9, 186, 192–3, 195, 223, 229, 236, 241, 251, 253, 259, 263, 323, 330 Desai, R 7, 8, 10, 14, 74, 80, 88–9, 91, 136–7, 139–40, 142–4, 147, 149–51, 156, 185, 213 Destabilizer 11, 257 Devalorization 320, 324 Devaluation of constant (fixed) capital 5, 41–3, 45, 65, 76, 269 currency 279–80, 335 Developed countries 9–10, 15, 159, 166, 172, 175, 178, 185, 187–8, 191, 193, 195–6, 299, 312 Dichotomy, 4, 13, 312, 343 Disproportionality, 3, 19–20, 146, 208, 256 Duncan, R 330 East Asia 164, 174, 193, 233, 254 Eastern Europe 16, 165, 280–81, 296, 335 Economic Adjustment Programme (EAP) 309 Egypt 328, 333 Emerging Capitalist Economies (ECEs) 13–14, 16, 287, 289–90, 295, 329 Employment 12, 18, 19–20, 32, 43, 50–51, 55, 65–6, 101, 150, 167, 189–90, 200–201, 203–6, 208, 212, 223, 240, 243, 260–61, 268, 271–2, 276, 283–5, 298, 320, 334 Epstein, 185, 330 Euro 10, 106, 153, 178, 182, 194, 196, 223, 267, 275, 279–80, 285, 323, 329, 332 area 245 24/05/2016 14:14 348 The great financial meltdown core 182–3, 309, 311–12, 314–16, 323 periphery 16, 148, 212, 182, 278–9, 309, 312, 315, 316 Europe 16–17, 46, 52, 56, 70, 89, 107, 110–12, 132, 148, 150, 153–5, 157–8, 165, 241, 245–6, 278–82, 284, 313, 328–9, 331–6, 338, 341 European Central Bank (ECB) 279, 281, 285, 289, 296, 301, 309, 311, 316, 326, 328, 337 European Economic Community (EEC) 183–4, 322–3 European Monetary Union (EMU) 15–16, 182–3, 194, 245, 279–80, 308, 310–12, 314–19, 323, 325, 333–4, 337 European Union (EU)15–16, 113, 164, 179, 182–4, 213, 246, 280, 309–13, 315–16, 323–5, 328–9, 333, 335–7, 342 European periphery 16, 148, 212, 182, 278–9, 309, 312, 315, 316 Fictitious capital 49, 86, 101, 323–4, 330 Financial capital 14, 88, 111, 113, 147, 184, 249–50, 256–8, 262, 282, 330, 337, 342–4 classes 14 crisis 8–9, 11, 14–15, 21, 24, 30, 40–41, 46, 67, 97, 100–102, 106, 109, 111, 153–4, 178–82, 184–9, 191, 193, 195–7, 217–18, 232, 236, 238, 241, 245, 248, 257, 275, 288–9, 293, 295–7, 299, 308, 313–14, 318, 329–30, 333, 336–7 elite 13, 275 incomes 12, 89, 258 Instability Hypothesis 272–4, 281, 317 instruments 11, 14, 88 integration 14, 280 intermediation / intermediaries 15, 82, 188–90, 195, 218, 273–4, 277, 281 Keynesianism 13, 266 markets 9, 12, 65, 109, 112, 160, 185–7, 191–3, 236, 238, 241–2, M3967 SUBASAT 9781784716486 PRINT.indd 348 244–5, 248, 250–51, 253, 255–63, 272, 275, 280, 283, 287, 289–95, 297–8, 310, 315, 337 sector 7, 9, 11, 12, 22, 24, 25, 28, 82–3, 118, 127–8, 154, 178–9, 184–8, 192, 195–6, 210, 219, 248, 251–2, 254–5, 257–9, 284, 293 securities 12, 249 services 15, 185–7, 195, 233, 242, 280 Financialization 3–4, 6, 9–17, 22, 25, 32, 39, 60, 65, 79, 89, 111, 117–18, 127–9, 131, 136, 151–3, 159–62, 172, 179–80, 184–91, 194–6, 211, 236, 238, 241, 248–55, 257–63, 272–3, 276, 283, 285, 287–90, 292–300, 308–309, 312, 314–18, 324–6, 329–37, 342–4 Contradictory nature (role) of 12–14, 289 Subaltern 16–17, 334–5 see also overfinancialization Fine, B 9, 63, 82, 159, 161, 169, 173–4, 212, 262, 288–9, 298, 307, 330 Fiscal deficit 108, 282, 310–12, 314, 316, 323–4 Fixed investment 12, 100, 237, 297, 299, 315 means of production 8, 97, 99, 100, 209, 211 Foreign Direct Investment (FDI) 14, 204–7, 211–13, 292, 295–6, 304, 330 Foreign reserves 9, 193, 196 Fouskas, V.K 16, 328–31, 333, 335 France 40, 75, 104–8, 165, 182–3, 190, 194, 279, 311, 328, 331, 333–4, 336, 338 Freeman, A 6, 14, 56, 73–4, 80, 83–5, 89, 91, 136–7, 139, 142, 144, 149, 155, 210 GDP, 8, 11, 20, 22, 27, 42, 75, 90, 103–7, 120, 128, 149, 184, 186, 189, 192, 194, 196, 197, 211, 213, 218, 279, 284, 296, 328, 336 Geopolitical 14, 73, 136, 138, 141–5, 147–8, 151–2, 329–30, 333, 335–6 24/05/2016 14:14 Index 349 Germany 16, 75, 104, 105, 107–8, 110, 113, 165–7, 178, 181, 183, 185, 188, 190, 194, 196, 211–12, 242, 278–84, 313, 328, 331–7 Global fault-lines 16, 328–30 financial collapse 98, 324 financial crisis 102, 106, 111, 289, 299, 318, 333, 337 liquidity 10, 178, 188 Globalization 25, 32, 45, 60, 110, 143, 162, 259–60, 330, 336–7 Golden age 7, 9, 88, 148, 150–51, 154, 223, 227, 232, 254, 260, 270, 320–21, 331, 334 Great depression 8, 18, 20, 80, 83–4, 88, 91, 98, 103, 111, 121–2, 137, 141–2, 149, 151, 173, 210, 218, 227, 251, 265, 270 recession 21, 24, 56, 60, 65, 69, 116–18, 121–2, 130, 142, 245, 248, 266–7, 276, 279 Greece 4, 7, 15–16, 164, 179, 181–3, 188, 190, 194, 212–13, 279, 308, 310–11, 313–9, 322–3, 325, 328–31, 333–8 Grossmann, H 57, 60, 68 Harris, L 82, 307 Harvey, D 5–7, 37–8, 40–42, 44, 47–9, 53, 55–69, 79, 97, 119, 186, 196, 212, 251, 253, 257, 262, 285 Hedging 14, 255, 258, 277, 294, 297, 300 High income countries 105, 107, 205 Hilferding, R 55, 238–40, 242, 250, 269, 282, 288 Hobson, J.A 88, 149–50, 238 Hong Kong 110, 292, 295, 297 Housing prices 11, 24, 48, 181, 190–91 Hudson, M 132, 150 Ideology 9, 21, 108, 123, 151, 159, 223, 342 Imperialism 84, 91, 140, 142, 149, 167, 179, 182–4, 322, 324, 335 Income distribution 10, 198, 204–205, 212, 219, 226, 240, 256, 299 M3967 SUBASAT 9781784716486 PRINT.indd 349 inequality 8, 11, 22, 24, 27, 28, 31, 32, 33, 67, 79, 88, 119, 122, 130, 131, 162, 170, 217, 219, 224, 262, 275, 314 India 50, 75, 91, 113, 148, 242, 244, 331, 341 Indonesia 50, 109, 197, 205 Industrial sector 16, 82, 167, 186, 334 Inflation 16, 29, 48, 64, 87, 94, 108, 113, 120, 125–9, 131, 145, 147, 151, 153–4, 242–3, 245, 260, 267, 277–8, 293, 315–18, 332–4, 337 Institutions 11, 22, 24–9, 32, 46, 97, 101, 111, 153, 160, 185, 218–19, 222, 231, 238, 242, 248, 250–51, 256, 282, 289, 291, 337, 242 International capital flows 138, 152–3, 155 liquidity 15, 153 International Labour Organization (ILO) 50, 162, 189, 190 International Monetary Fund (IMF) 73–5, 91, 109, 113, 161, 197, 291, 295, 297, 300, 309, 328, 337 Iraq 50 Ireland 46, 67, 183–4, 188, 190, 194, 212–13, 279, 281, 311 Italy 104–8, 164, 188, 279, 311, 328, 333, 338 Itoh, M 56, 263 Jaffe, D 113 Japan 52, 75, 104–8, 110, 112, 149–50, 154, 167, 188, 190, 228, 279, 331, 341 Kaldor paradox 313 Kalecki, M 86, 237, 239–40, 244, 270–71, 274, 279–82 Kaltenbrunner 11, 13, 287, 289, 294, 300 Karacimen, E 11, 13, 287, 289, 296, 300, 302 Kautsky 55, 269 Keynes, J 13, 25, 31–2, 47, 62, 66–7, 70, 82, 84–7, 113, 138–41, 144, 151, 162, 166, 168–9, 173–4, 196, 211–13, 238, 240–41, 243–4, 249, 253, 259, 266–7, 270–74, 276–9, 24/05/2016 14:14 350 The great financial meltdown 281, 283–5, 307–308, 311–12, 317, 322–3, 331–2, 334–5, 337–8, 343 Keynesianism financial 13, 266 neo 311 post 62, 67, 196, 212, 240–41, 259, 271–2, 274, 284, 308, 312, 338 privatized 13, 267, 276–8, 283 Kliman, A 37, 56, 64, 75, 79, 80, 83, 89, 90, 139 Korea (South) 75, 109, 192, 197, 294–5, 297 Koshimura, S 212 Kotz, D.M 4, 7–8, 11, 18, 22, 25–6, 29–30, 33, 83, 89, 97, 119, 130, 144, 178, 213, 250–51, 258, 285 Krugman, P 130–32, 148, 194, 311 Kuhn, K 77, 208 Labor income 7, 13, 276 power 6, 37–8, 41, 44, 127–9, 131, 138, 199, 268, 271 Lapavitsas, C 32, 56, 89, 136, 184–5, 187–8, 194, 196, 236, 241, 254, 263, 288, 314–15, 318, 329, 331–2 Latin America 45, 68, 109, 112, 149, 164, 193, 290–91, 331, 334 Lehman Brothers 12, 30, 222, 233, 236, 245 Lenin, V.I 55, 88, 111 Liquidity squeeze 12 London 16, 56, 60, 220, 336 Luxemburg, R 55, 101, 212, 237, 239–40, 270, 279, 281–2 Magdoff, H 130, 239, 251–2, 287 Mainstream 15, 22, 57, 100, 159, 161–2, 169, 173, 179, 211–12, 239, 240, 255–6, 263, 274, 277, 307–16, 324, 326, 344 Mandel, E 79, 138, 143–4, 146, 148 Maniatis, T 319, 321 Marx, K 4–8, 10–13, 15, 18–19, 21, 24–5, 27–8, 31–2, 37–49, 51–3, 55–9, 61–9, 77–81, 84–8, 91, 97–100, 102–3, 110–11, 113, 118, 130, 136–44, 146–7, 155, 169, 179, 196, 198–201, 204, 206–8, 210–13, 220, 222–3, 232, 237–8, 240–41, M3967 SUBASAT 9781784716486 PRINT.indd 350 246, 248–9, 252–3, 255–7, 259, 263, 266–71, 274, 281–3, 307–9, 314–15, 319–21, 325, 329, 341–4 Marxism 11, 13, 18–19, 136–7, 139, 143, 169, 179, 240, 271, 307–9, 319, 325 Mavroudeas, S.D 4, 7, 15–16, 179, 182, 307, 315, 321, 325 Means of consumption 198–203, 205–7, 208–9, 212 production 5, 8, 10, 37, 58, 97, 99–100, 113, 198–203, 207–9, 211–12, 268 Mergers and acquisitions 12, 213, 227, 243, 276, 280, 298, 330 Mexico 109, 205, 294–7 Middle East 52, 164–5, 322, 328 Middle income countries 106, 109, 113, 205, 341 Minsky, H.P 67, 238, 243–4, 266–7, 271–4, 276, 281–4, 317 Mohun, S 7, 10–11, 83, 217, 224, 226, 233, 246, 285 Monetary theory 11, 13, 239, 271 Money capital 14, 47, 65, 88, 113, 255–6, 271, 299, 324 manager capitalism 267, 276, 281, 283 markets 11, 217, 232 Monocausality 55, 56–7 Monopolization 5, 42, 58, 249, 253, 287, 298 Moral depreciation of capital 3, 82, 210, 212 fixed capital 8, 209 Morishima, M 212 Mortgages 10–11, 13, 22–3, 70, 145, 147, 149, 217–18, 229–31, 276, 278, 300, 333 Securitized 11, 231 Subprime 11, 217–18, 231, 278 Moseley, F 37, 40, 56, 59, 69, 83 Mundell R 332 Neoclassical 18, 32, 61, 80, 136–41, 211–12, 239, 274, 307, 343–4 Neoliberalism 3–4, 6–11, 13–16, 21, 24–33, 79, 85, 88–9, 116–19, 24/05/2016 14:14 Index 351 121–4, 127–32, 136, 148, 150–51, 154–5, 159–63, 166–7, 169–70, 172–4, 218–19, 221, 223–7, 229–32, 236, 241, 249, 251, 253, 259, 262–3, 266–7, 270, 274–6, 281, 283, 285, 307–9, 311, 316–17, 320–23, 325, 329–32, 334–7, 342–3 Neo-mercantilism 16, 278, 284, 312, 314, 315, 332, 337 New International Economic Order 150 New Right 9, 150 New York 16, 49, 250, 336 Non-financial capital 252, 254 corporations (NFCs) 11–12, 14, 22, 24, 111, 191, 225, 236–7, 248, 251, 254, 257–62, 289–91, 294–300 Oil crisis 3, 193 price 3, 9, 98, 101, 147, 178, 182, 193, 196 Okishio, N 77, 82, 102, 113, 140, 144, 212 Optimal Currency Area (OCA) 311–12, 314–16, 332 Organic Composition of Capital (OCC) 5–8, 47, 58, 62–4, 82, 100, 102, 144, 180, 209, 269, 320 Organisation for Economic Cooperation and Development (OECD) 188, 190, 245 Orhangazi, O 10–12, 248–51, 256–8, 261, 263, 285, 287 Overaccumulation 3, 8, 12, 19, 27, 29, 31, 33, 40, 43, 65, 180, 313, 252–4, 320–21, 324, 327, 329 Overfinancialization 10, 15, 187–8, 190–91, 195–6 Overproduction 8–9, 67, 78, 98, 101, 111, 113, 145–6, 150–51, 208, 213 Patnaik, P 147 Periphery 16, 147–8, 179, 182–3, 194, 196, 212, 275, 278–9, 309, 312, 315–16, 332–5, 337–8 Piketty, T 22, 67, 121, 224 Policy driven M3967 SUBASAT 9781784716486 PRINT.indd 351 Policy errors 3–4, 15, 117, 179, 308, 310–11, 314, 319 Policy-based 4, 9, 178–9, 191, 195, 198 Political economy 3, 14, 38, 40, 59, 77, 83–4, 136–9, 141–3, 148, 151–2, 155, 172, 179–81, 236–7, 239–40, 245–6, 271, 281, 283, 308, 319, 329–30, 336 Portugal 164, 182–4, 189–91, 194, 212–13, 279, 311, 336 Productive capital 12, 14, 110, 113, 124, 127, 184, 238, 249–51, 258, 299, 318, 324 Profit falling rate of 3, 7–8, 12, 19, 31, 38–40, 42, 44–6, 50, 52–3, 61, 78, 82, 90, 100, 102, 180, 182, 224–5, 285, 287, 309, 320 squeeze 3, 5, 7, 19, 27, 31–2, 62, 145, 208–9, 212, 268, 270, 341 see also tendency of the rate of profit to fall (TRPF) Profitability 4, 7–8, 12, 16, 35, 37, 48, 52, 55, 60–65, 69, 99–100, 146, 151, 209, 223, 227–9, 252–4, 256–60, 263, 268, 270, 285, 298, 309, 314–16, 319–24, 330–32, 336 Protectionism 9, 150, 322 Real estate 15, 22, 24, 33, 188–90, 195, 250, 278–9, 292, 298, 320 Real sector 12–13, 21, 24, 28, 118, 297, 249–50, 252, 254, 256, 288 Realization of value 12, 99, 240–41, 243, 245 problems 5, 201, 212, 241 Recession 8, 18–19, 21, 24, 27, 56, 60, 65, 68–9, 72–3, 82, 90, 104–5, 108–9, 116–18, 121–2, 130, 142, 149, 217, 242, 245, 248, 266–7, 276, 279, 296, 324, 331, 341 Regionalization 16, 336 Regulation-in-denial 13, 275 Reproduction schemes 10, 196, 198–9, 211–12 simple and expanded 199, 202, 209 social 4, 7, 9, 95, 160, 172, 202, 262, 285 24/05/2016 14:14 352 The great financial meltdown Reserve army of labor 10, 198–9, 203–5, 207–8, 255, 260 Ricardo, D 38, 40, 46, 77–8, 81, 98, 113, 139–40 Roberts, M 5–6, 37, 41, 46, 49, 55–8, 60, 62, 65, 67, 68–70, 77, 196 Rodolsky, R 57 Roemer, J.E 82 Russia 137, 148, 152, 331, 333, 341 Saad-Filho, A 63, 300 Sale and repurchase agreements 10, 221 Sawyer, M 329 Schumpeter, J 84–5, 89, 137, 141–2, 237, 266, 271, 281 Securitization 10, 188, 229–31, 278 Shaikh, A 36, 56, 82–3, 89, 113, 146, 207, 212, 263, 319, 322 Shareholder 12, 123–4, 127–8, 258–60, 282 Singapore 292, 295 Smith, A 51, 60, 77–8, 88, 113, 124, 131, 139 Social expenditures 13, 223, 275 Social institutions 13, 275 policy 9, 159, 162–3, 169, 172–3 South Africa 205, 292, 331, 341 South Asia 52 Southeast Asia 52 Spain 46, 67, 164, 182–4, 188, 190–91, 194, 212–13, 278–9, 311 Speculation 11, 28, 67, 78, 109, 111, 147, 154, 236, 241, 246, 250–51, 292, 294, 297, 300, 330 Sraffa, P 81, 140, 266 Stages of capital accumulation 10, 198 State 4, 9, 13, 16, 18–22, 25–8, 30, 32–3, 38, 41–2, 46, 50, 57, 60, 83, 117, 125, 136–7, 141–4, 147–8, 151, 154, 160–62, 164, 174, 179, 186, 198, 205, 212, 223, 230, 232, 240–41, 243, 249, 251–2, 254–5, 266, 272, 275, 282, 284–5, 291, 313, 316–17, 322–4, 328–38 Steedman, I 81 Stiglitz, J 67, 130–31 Stock markets 6, 295 M3967 SUBASAT 9781784716486 PRINT.indd 352 Summers, L 29, 148 Sweezy, P 56, 58, 81, 143, 239–40, 251, 256, 270, 287 Systemic 3–4, 8–9, 15, 53, 98, 99, 101, 103, 111, 130, 153, 159, 161–3, 173, 178–80, 195–6, 198, 208, 210, 217–18, 283, 307–8, 319, 329 Taiwan 292 Technical change 5, 7, 42, 82, 99–100, 180, 256 Tendency of the rate of profit to fall (TRPF) 4–7, 15, 41, 55–62, 64, 67–9, 77–80, 89, 91, 140, 144, 146, 179–80, 209–10, 309, 319, 321–2, 324 Thailand 197, 205, 296 Tonak, A 319, 322 Top income earners 9, 11 Toporowski, J 11, 86, 111, 236, 239, 241–3, 277, 281, 285, 289 Trade deficit 92, 206, 211, 212, 279, 312, 315 imbalances 41, 267, 279, 314 surplus 16, 108, 110, 181, 197, 206, 211, 312, 315 unions 26–8, 108, 223, 280, 342–3 Triffin Dilemma 15, 152–3 Trigg, A.B 212 Turkey 296–7, 299 Twin Deficits Hypothesis (TDH) 311–14, 224 Underconsumption 3, 7–8, 19, 27, 29, 31, 66, 70, 79, 111, 140, 145–6, 181, 199, 207–8, 211, 213, 241, 269–70, 314, 321, 342 Unemployment 10, 18, 20, 25, 27, 29, 31, 65, 90, 113, 148, 155, 162, 167, 181, 198, 203, 204, 205, 206, 209, 211, 212, 255, 256, 260, 274, 293, 328 Unequal exchange 182, 309 Uneven development 262, 332 Unit labour costs 313 United Kingdom (UK) 6, 82–4, 104–5, 109, 112, 132, 152, 154, 164, 186–7, 190, 221, 223, 233, 245, 279, 332–3, 341, 342 24/05/2016 14:14 Index 353 United Nations Conference on Trade and Development (UNCTAD) 110, 292, 295 United States (US, USA) 6–8, 11, 14, 16, 19–22, 26–32, 41–2, 49–51, 56, 60, 62, 65, 67, 69–70, 83–4, 90, 97–8, 101, 103–14, 116–23, 125, 127–32, 147–55, 178–9, 181, 185–8, 190, 193–7, 211, 217–19, 221–4, 228, 230, 233, 245, 248, 250–52, 254, 260–61, 263–4, 278, 282, 287, 289–90, 292–6, 313, 328, 331–2, 334, 336–7, 341–3 Unproductive labor 51, 180, 186, 319, 320–21, 343 Value added 108, 112, 114, 188–9, 271, 321 Composition of Capital (VCC) 7, 37, 63, 268–70 of labor-power 127–9, 131, 268 Variable capital 5, 37, 47, 63, 199–200, 268–9 Veblen, T 238 Venezuela 297 Vertical integration 5–6, 47, 64 Volatility 13, 153, 287, 291, 292, 294, 330 M3967 SUBASAT 9781784716486 PRINT.indd 353 Wages 5, 7–10, 16, 21–2, 26–9, 32, 38, 41, 44, 46, 49–51, 58, 62–3, 65–6, 67, 70, 88, 108, 117, 120–24, 126, 128–31, 138, 146, 148–50, 154, 179, 181, 194, 198–9, 201, 203–4, 206–9, 211–13, 241, 255–6, 260–62, 268–70, 272, 278–9, 287, 310, 313–15, 320–23, 332–4, 337 Wallerstein, I 143 Walras, L 81, 139 Weeks, J 7–8, 80, 97, 101, 104, 106, 108–9, 111, 113–14, 196, 208–10, 212, 246 Weisskopf, T 33, 119 Welfare regime approach (WRA) 9, 159, 163–71, 172–4 Western Europe 112, 132, 148, 150, 154 Western supremacy 14, 48, 152 Wolff, R.D 179, 181, 210 World Trade Organization (WTO) 9, 178, 193, 196 World War I (WWI) 147, 208 World War II (WWII) 21, 31, 61–2, 84, 98, 101, 103–6, 112, 116, 119, 121, 131, 251–2, 282, 321 Yaffe, D 56 Zarembka, P 140 24/05/2016 14:14 ... rejects the primacy of the real sector over the financial sector, which is no longer the case due to the structural changes that have taken place in the financial and non- financial sectors Orhangazi... regard, corporate finance has played an important role in the explanation of the crisis Business corporations have access to the full range of financial markets all around the world, which allows them... crisis to the rest of the economy In other words, it was the failure of capital accumulation (upon which capitalism depends for the realization of value) rather than the failure of the financial