Selected chapters appear in Kapitalizmin Finansal Krizi (Turkish), edited by Prof.Arabic translation by Ateyyah Kareem Al Zafiri (Afaq Educational Services Company, Kuwait City, Kuwait, 2013).Bangla translation by Farooque Chowdhury (Dhaka: Shahitya Prakash, 2011).Spanish translation, Fondo De Cultura Económico (Spain), 2009.Czech language edition published by Grimmus, Czech Republic, 2009.Korean translation from Eulyoo Publishers.This casts doubt on whether Keynesian fiscal policies could be employed to restore a healthy profit rate in the manufacturing sector and lower unemployment. The paper finds that the impact of government consumption expenditure on the manufacturing profit rate is positive and significant in both the short-term and long-term (from 93), while the long-term impact becomes negative from 1983 to 2015, when the financial sector profit rate began its upward trend.
Its goal is twofold: to determine whether stagnation is associated with a decline in Keynesian policies, and to examine the potential for state fiscal programs to reverse this trend and facilitate a shift of private investment away from the financial sector and into manufacturing. This paper employs an Auto-regressive Distributed Lag (ARDL) model to test the impact of both national defense and government consumption expenditure on manufacturing profitability in the United States from 1973, the onset of stagnation, to 2015. However, scholars have not reached a consensus regarding the factors responsible for stagnation in manufacturing.
The overall results suggest that the rise in financialization is parallel to the decline in the profit rates, leading to larger military expenditure in total, but with relatively smaller share in GDP.įinancialization can be partially attributed to the decline in the US manufacturing profit rate since the 1970s. The findings show that the decline in the profit rates lead to a decline in military expenditure. Considering alternative financialization variables commonly used in the literature and the profit rate in the financial sector, and using several parametric and non-parametric methods, we found a significant relationship between financialization and militarization in the US for 1949-2019. Monopoly capital was transformed into finance monopoly capital as the intensity of financial capital increased during the late 1970s in response to stagnation. Military spending during the 1950s and 1960s in the US, along with other external stimuli, such as a rising sales effort and expansion in finance, insurance, and real estate, counteracted the stagnation of the monopolistic stage of capitalism. Based on Arrighi (1994), we empirically investigate whether financialization and militarization are mutually reinforcing phenomena in the US during the post-WW II period.
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