scispace - formally typeset
Search or ask a question
Journal ArticleDOI

Marx after Minsky: Capital Surplus and the Current Crisis

27 Sep 2016-Historical Materialism (Brill)-Vol. 24, Iss: 3, pp 105-146
TL;DR: Minsky's theory of financial instability helps clarify how Marxist theory can explain the highly financialised capitalism of today, and the crisis which started in 2008 as mentioned in this paper, and the combination of instability and stagnation which results from an excess supply of loanable capital.
Abstract: Minsky’s theory of financial instability helps clarify how Marxist theory can explain the highly financialised capitalism of today, and the crisis which started in 2008. The advanced economies currently have high realised profits in the productive sector and lagging rates of investment. Shareholder pressures encourage corporate strategies which focus on stock-market ratings and MA low interest rates; recurrent boom and bust in asset markets; the fuelling of huge increases in household and government debt; and the combination of instability and stagnation which results from an excess supply of loanable capital.
Citations
More filters
01 Jun 2012
TL;DR: This article presented evidence that accounting (or flow-of-funds) macroeconomic models helped anticipate the credit crisis and economic recession, while equilibrium models ubiquitous in mainstream policy and research did not.
Abstract: This paper presents evidence that accounting (or flow-of-funds) macroeconomic models helped anticipate the credit crisis and economic recession. Equilibrium models ubiquitous in mainstream policy and research did not. This study traces the intellectual pedigrees of the accounting approach as an alternative to neo-classical economics, and the post-war rise and decline of flow-of-funds models in policy use. It includes contemporary case studies of both types of models, and considers why the accounting approach has remained outside mainstream economics. It provides constructive recommendations on revising methods of financial stability assessment and advocates an ‘accounting of economics’.

136 citations

Journal ArticleDOI
TL;DR: The principal subject of this annual bibliography is the English language scholarly literature of American Communism (supplemented by the occasional article from serious journals of opinion, obitua... as discussed by the authors ).
Abstract: The principal subject of this annual bibliography is the English language scholarly literature of American Communism (supplemented by the occasional article from serious journals of opinion, obitua...

109 citations

Journal ArticleDOI
TL;DR: The authors argued that state interventions may attenuate some of capitalism's destabilizing processes but these displace rather than eliminate the underlying contradictions and themselves contribute to longer-term instability and crises.
Abstract: The profound insights provided by Minsky's theory of financial instability are insufficient. On the one hand, as Marxists and other critics have pointed out, they tend to dissociate finance from the instability-creating dynamics of the wider economy. On the other hand, they tend to depict the state as an exogenous, stabilizing, influence. This creates an inherent tension in Minsky's analysis, which also insists, “stability is destabilizing.” A Marxist understanding resolves this tension. The state is an essential and active component of capitalism and its contradictions. State interventions may attenuate some of capitalism's destabilizing processes but these displace rather than eliminate the underlying contradictions and themselves contribute to longer-term instability and crises.
References
More filters
Journal ArticleDOI
TL;DR: In this paper, a translation of the poem "The Pleasures of Philosophy" is presented, with a discussion of concrete rules and abstract machines in the context of art and philosophy.
Abstract: Translator's Foreword: Pleasures of Philosophy Notes on the Translation and Acknowledgements Author's Note 1. Introduction: Rhizome 2. 1914: One or Several Wolves? 3. 10,000 BC: The Geology of Morals (Who Does the Earth Think It Is?) 4. November 20th, 1923: Postulates of Linguistics 5. 587BC-AD70: On Several Regimes of Signs 6. November 28th, 1947: How Do You Make Yourself a Body Without Organs? 7. Year Zero: Faciality 8. 1874: Three Novellas, or "What Happened?" 9. 1933: Micropolitics and Segmentarity 10. 1730: Becoming Intense, Becoming-Animal, Becoming Imperceptible... 11. 1837: Of the Refrain 12. 1227: Treatise on Nomadology - The War Machine 13. 7000BC: Apparatus of Capture 14. 1440: The Smooth and the Striated 15. Conclusion: Concrete Rules and Abstract Machines Notes Bibliography List of Illustrations Index

14,735 citations

Book
01 Jan 1867
TL;DR: In the third volume of "Das Kapital" as discussed by the authors, Marx argues that any market economy is inevitably doomed to endure a series of worsening, explosive crises leading finally to complete collapse.
Abstract: Unfinished at the time of Marx's death in 1883 and first published with a preface by Frederick Engels in 1894, the third volume of "Das Kapital" strove to combine the theories and concepts of the two previous volumes in order to prove conclusively that capitalism is inherently unworkable as a permanent system for society. Here, Marx asserts controversially that - regardless of the efforts of individual capitalists, public authorities or even generous philanthropists - any market economy is inevitably doomed to endure a series of worsening, explosive crises leading finally to complete collapse. But he also offers an inspirational and compelling prediction: that the end of capitalism will culminate, ultimately, in the birth of a far greater form of society.

6,401 citations

Book
29 Aug 2008
TL;DR: MacKenzie as mentioned in this paper argues that the emergence of modern economic theories of finance affected financial markets in fundamental ways, and argues that economic models are an engine of inquiry rather than a camera to reproduce empirical facts.
Abstract: In An Engine, Not a Camera, Donald MacKenzie argues that the emergence of modern economic theories of finance affected financial markets in fundamental ways. These new, Nobel Prize-winning theories, based on elegant mathematical models of markets, were not simply external analyses but intrinsic parts of economic processes. Paraphrasing Milton Friedman, MacKenzie says that economic models are an engine of inquiry rather than a camera to reproduce empirical facts. More than that, the emergence of an authoritative theory of financial markets altered those markets fundamentally. For example, in 1970, there was almost no trading in financial derivatives such as "futures." By June of 2004, derivatives contracts totaling $273 trillion were outstanding worldwide. MacKenzie suggests that this growth could never have happened without the development of theories that gave derivatives legitimacy and explained their complexities. MacKenzie examines the role played by finance theory in the two most serious crises to hit the world's financial markets in recent years: the stock market crash of 1987 and the market turmoil that engulfed the hedge fund Long-Term Capital Management in 1998. He also looks at finance theory that is somewhat beyond the mainstream -- chaos theorist Benoit Mandelbrot's model of "wild" randomness. MacKenzie's pioneering work in the social studies of finance will interest anyone who wants to understand how America's financial markets have grown into their current form.

1,650 citations

Book ChapterDOI
TL;DR: In the past two decades, the ideology of shareholder value has become entrenched as a principle of corporate governance among companies based in the United States and Britain this article and has become prominent in the corporate governance debates in European nations such as Germany, France and Sweden.
Abstract: Over the past two decades the ideology of shareholder value has become entrenched as a principle of corporate governance among companies based in the United States and Britain. Over the past two or three years, the rhetoric of shareholder value has become prominent in the corporate governance debates in European nations such as Germany, France and Sweden. Within the past year, the arguments for ‘maximizing shareholder value’ have even achieved prominence in Japan. In 1999 the OECD issued a document, The OECD Principles of Corporate Governance, that emphasizes that corporations should be run, first and foremost, in the interests of shareholders (OECD, 1999)

1,533 citations

Posted Content
01 Jan 2006
TL;DR: MacKenzie as mentioned in this paper argues that the emergence of modern economic theories of finance affected financial markets in fundamental ways, and argues that economic models are an engine of inquiry rather than a camera to reproduce empirical facts.
Abstract: In An Engine, Not a Camera, Donald MacKenzie argues that the emergence of modern economic theories of finance affected financial markets in fundamental ways. These new, Nobel Prize-winning theories, based on elegant mathematical models of markets, were not simply external analyses but intrinsic parts of economic processes. Paraphrasing Milton Friedman, MacKenzie says that economic models are an engine of inquiry rather than a camera to reproduce empirical facts. More than that, the emergence of an authoritative theory of financial markets altered those markets fundamentally. For example, in 1970, there was almost no trading in financial derivatives such as "futures." By June of 2004, derivatives contracts totaling $273 trillion were outstanding worldwide. MacKenzie suggests that this growth could never have happened without the development of theories that gave derivatives legitimacy and explained their complexities. MacKenzie examines the role played by finance theory in the two most serious crises to hit the world's financial markets in recent years: the stock market crash of 1987 and the market turmoil that engulfed the hedge fund Long-Term Capital Management in 1998. He also looks at finance theory that is somewhat beyond the mainstream--chaos theorist Benoit Mandelbrot's model of "wild" randomness. MacKenzie's pioneering work in the social studies of finance will interest anyone who wants to understand how America's financial markets have grown into their current form.

1,055 citations