Financialization is a pattern of accumulation dominated by financial channels over trade and production

Evidence

Here,I follow Arrighi (1994) in defining financialization as a pattern of accumulation in which profit-making occurs increasingly through financial channels rather than through trade and commodity production. One advantage of such a definition is that it is capable of encompassing alternative usages of the term: in a world where accumulation occurs predominantly through financial activities, one would expect systems of corporate governance to reflect the imperatives of financial markets. Similarly, one would expect that social actors occupying strategic positions vis-à-vis privileged sites of accumulation would accrue political and economic power. Finally, one would also expect a rapid pace of financial innovation, as well as financial flows that dwarf real economic activity. — Greta R. Krippner, The Financialization of the American…, 42

Categorization

• DEFINE: Provides the operative definition of financialization that grounds the whole field of study.
• XREF: Connects to later financialization literature (Epstein, Krippner’s own 2011 book) and to Arrighi’s ‘Long Twentieth Century.’ — connects to: Financialization channels income toward the wealthy and depresses productive investment and wages. — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 24; Stagnating growth plus deregulation pushed firms from production into financial investment — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 41; Financialization marks a decisive shift from production-based to finance-driven accumulation. — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 19 (+5 more)

Related

• Financialization means accumulation through financial channels rather than production (similarity 0.95)
• Financialization marks a decisive shift from production-based to finance-driven accumulation. (similarity 0.94)
• Financialization comprises both finance-sector dominance and nonfinance firms’ financial investing. (similarity 0.87)
• The financialization literature lacks a unified definition across four competing usages (similarity 0.87)
• The US economy became increasingly financialized in the post-1970s period. (similarity 0.87)
• Financialization ultimately represents markets displacing social institutions as society’s organizing principle. (similarity 0.85)
• Financialization lacks rigorous empirical evidence defining its timing and magnitude (similarity 0.85)
• Financialization both derives profits from finance and drains capital from productive investment (similarity 0.85)
• Financialization must be measured by profit generation, not employment or output (similarity 0.85)
• Scholars asserted financialization’s existence without providing direct evidence (similarity 0.85)
• Finance has come to dominate American economic life. (similarity 0.85)
• Financialization scholarship spans three approaches with distinct analytic foci. (similarity 0.84)
• Financialization is integral to capitalism, not a product of deregulatory excess (similarity 0.84)
• Financialization has both micro and macro scholarly definitions (similarity 0.84)
• Financialization shifts capital intermediation from institutions to markets. (similarity 0.83)

Broader Connections

• Financialization both derives profits from finance and drains capital from productive investment #expands (0.92) — Natascha van der Zwan, Making Sense of Financialization, 29
• Financialization has both micro and macro scholarly definitions #qualifies (0.80) — Andrew deWaard, Derivative Media, 97