Profiting Without Producing by Costas Lapavitsas

Author:Costas Lapavitsas [Lapavitsas, Costas]
Language: eng
Format: epub
ISBN: 978-1-78168-197-8
Publisher: Verso Books
Published: 2014-01-14T05:00:00+00:00

Part 3 EMPIRICAL AND HISTORICAL FEATURES OF FINANCIALIZATION

7. THE CONTEXT OF FINANCIALIZED ACCUMULATION

Analysing financialization in historical terms

Financialization is the outcome of historical processes that have taken place across the world since the 1970s; it represents a period change of the capitalist mode of production entailing a systemic transformation of mature economies with extensive implications for developing economies, and should properly be examined in these terms. Finance has become ascendant in domestic accumulation, thus setting afresh both the terms of profit extraction and the relations of hierarchy among countries.

Several of the theoretical approaches discussed in Chapter 2 share the view – implicitly or explicitly – that financialization reflects a transformation of the capitalist mode of production. Period analysis, however, has particular requirements and poses characteristic difficulties. It cannot be a mere elaboration of historical events, and nor of patterns of social change, since it would then become either history or a concrete study of particular social formations. Equally, it cannot be an abstract discussion of the evolving relations of capitalist accumulation, since it would then lose much of the specificity characteristic of historical periods of development. Of necessity period analysis must occupy a middle ground, departing from theoretical concerns while systematically integrating historical phenomena in a theoretically informed way.

Period analysis in classical Marxist theory took shape in the early twentieth century in connection with the analysis of imperialism, summed up in chapters 2 and 3.1 Lenin’s analysis, in particular, was explicitly a theory of the succession of historical periods in the development of capitalism – laissez-faire, monopoly, and imperialist capitalism. His theory of imperialism was grounded on the fundamental tendencies of capitalist accumulation, while simultaneously incorporating prominent historical developments. Lenin, drawing on Hilferding, related imperialism to the rise of monopoly, the emergence of finance capital, and the export of capital from the metropolis to the periphery resulting in inherently exploitative relationships among countries in the world market.2

In this light, the theoretical analysis proposed in Chapter 2 has sought the roots of financialization in the molecular processes of capitalist accumulation, namely in the altered conduct of enterprises, banks and workers. Fundamental to the structural transformation represented by financialization have been the financial operations of monopoly capitals (joint-stock multinational enterprises). Contemporary monopoly capitals rely on retained profits to finance investment; insofar as they require external finance they are capable of raising funds in open markets, thus also acquiring financial skills. Hilferding’s assertion that in the course of capitalist development monopoly capitals rely increasingly on banks to fund fixed investment, hence giving rise to finance capital, does not hold in contemporary conditions.

Fundamental to financialization has also been the altered conduct of banks, including mediating and transacting in open markets as well as lending to, and handling the financial assets of, individuals. Perhaps most striking, however, has been the altered conduct of individuals – and households in general – who have been drawn into the realm of formal finance for purposes of both borrowing and lending. It is equally important to note that, given the

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.