GLOBAL FINANCE, INCOME DISTRIBUTION AND CAPITAL ACCUMULATION

Abstract

The appreciation of the consequences of financial globalization is an important task for contemporary political economy. This paper maintains that industrial and macroeconomic instability faced by many developed and developing countries is likely to be attributed, to an extent, to changes in income distribution in favour of rentiers, financiers and other groups of financial capitalists. We elaborate on Marx's and Keynes's ideas and argue that a rise in rentiers' income might have been an obstacle to industry's investment decisions, and detrimental to capital accumulation. The econometric analysis conducted provides evidence in line with the paper's major hypothesis for the United States and the UK. Copyright 2006, Oxford University Press.