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There has been a great deal of interest in the data on income and wealth inequality collected by Thomas Piketty. This paper does not question that data; rather, it questions the framework of Piketty's analysis, both theoretically and empirically—namely the alleged upward tendency of the ratio of wealth to national income and the rise of wealth inequality. First, in the mechanism put forward, wealth can only grow as a result of savings, thus ruling out any form of price effect (as in urban land). Second, Piketty’s second law defines an asymptotical trajectory, in which variables grow in parallel, something incompatible with the rise of the ratio between two variables. In addition, Piketty’s model does not match data for the USA. The historical profile of the ratio of wealth/national income is actually the inverted image of the productivity of capital (the ratio of output/firms’ fixed capital). Doubts are also expressed concerning the dramatic fall of the ratio of wealth/national income in Europe ar...

Dans cet entretien consacre a leur livre Managerial Capitalism : Ownership, management and the coming new mode of production (Pluto Press, 2018), G. Dumenil et D. Levy reviennent sur les implications de leur analyse du capitalisme managerial pour l’etude du capitalisme historique, de ses structures de classes fondamentales, et de ses alliances de pouvoirs variables. La these du marxisme traditionnel identifiant les managers a une fraction de classe capitaliste s’en trouve critiquee, de meme que les presupposes vehicules par le concept de « capitalisme d’Etat ». Invites a revenir plus precisement sur leur distinction entre modes de production et « ordres sociaux », comme configurations variables de hierarchies de pouvoirs et d’alliances de classe, les auteurs clarifient les raisons pour lesquelles ils introduisent une nouvelle categorie de mode de production managerial qui impose de repenser le mode de production capitaliste lui-meme suivant une logique de « l’hybridite ». Celle-ci permet de complexifier les tendances du capitalisme historique sur la longue duree, d’approfondir l’analyse de classe du capitalisme managerial, et d’y specifier differentiellement, par rapport au « compromis » d’apres-guerre (caracterise par une alliance entre managers et classes populaires sous la direction des premiers), le dernier ordre social en date caracterise par une alliance « au sommet » entre managers et capitalistes (au detriment des classes populaires) : le neoliberalisme.

This paper is a reply to William Lazonick’s criticism of our analysis of managerial capitalism and its later phase in neoliberalism, based on the data on income distribution put forward by T. Piketty, E. Saez, and G. Zucman. Two of these criticisms are the expressions of basic misunderstandings. First, we do not believe the managerial revolution occurred against the will of capitalist classes, although, in various later decades, the income and wealth of these classes were dramatically diminished in the New Deal and after World War II. Second, we see in the maximization of shareholder value a central feature of neoliberal capitalism, as Lazonick does. The difference is that we address this feature in the broader context of variegated tendencies jointly expressing the class nature of neoliberalism, a social order targeted toward maximizing the income and wealth of upper classes. What Lazonick says of the taxation of stock options stresses some of the ambiguous features of the distinction between “w...

The paper first documents income and wealth inequalities since World War I in the United States, a pattern in three stages, with a reduction of inequality since the Great Depression from the high predepression levels, stagnation at diminished levels up to 1980, and a dramatic restoration in neoliberalism. Underlying these three phases, we show the continuous transformation of the composition of the income of the top 1 percent to the benefit of “wages,” testifying to the progress of the managerial aspect of production relations. These trends manifest the ongoing transition toward managerialism, a postcapitalist mode of production with managers as upper class. In the hybrid social formation of managerial capitalism, a tripolar class pattern prevails, namely, capitalists, managers, and popular classes. The three subperiods are interpreted in relation to the configuration (in social orders) of class dominations and alliances, in the first financial hegemony (domination of capitalist classes in allian...

In an article in this journal, Amitava Dutt comments on our 1999 paper, ‘Being Keynesian in the Short Term and Classical in the Long Term: The Traverse to Classical Long-term Equilibrium’, contending that aggregate demand may affect the long-term equilibrium. We agree to some extent but contend that these mechanisms do not question the fundamental difference between the classical-Marxian perspective (in which u gravitates in the long term around uˉuˉ ) and the post-Keynesian perspective (in which the long-term equilibrium position of u depends on the level of aggregate demand). The basic controversy harks back to Harrod’s investment function, in which the only long-term equilibrium is u = uˉuˉ . We solve the problem of Harrodian instability in reference to the action of monetary authorities and governments. Dutt’s defence of the post-Keynesian investment function is unconvincing.

This study is devoted to the financing of demand out of income and borrowing, a crucial aspect of Kalecki's analysis of investment. If the demand for loans moves procyclically, short-term equilibrium is unstable. The borrowing of non-financial agents must be checked by the action of central banks. Models in which both procyclical and countercyclical mechanisms are considered provide the basis of monetary macroeconomics. Money is neither endogenous nor exogenous but co-determined by the behaviors of financial and non-financial agents. The succession of phases in which the stability of the short-term equilibrium is ensured or not defines an important aspect of the business cycle.

Too often, Marxist economists approach the notion of “unproductive labor” negatively. Unproductive labor within enterprises is, however, not useless. Its purpose is the maximization of the profit rate. In Marx's analysis of capital, the entire process is divided into the valorization of capital (the extraction of surplus value) and the circulation of capital. Unproductive labor does not create new value or surplus value, but contributes to the two aspects, increasing surplus value and accelerating the circulation of capital. Thus, the profit rate—the aim of capitalist production—is increased. In Capital, these tasks are introduced as performed by the capitalist, but Marx also explains that, within modern corporations, they are delegated to a salaried personnel: managerial and clerical (also commercial) personnel. As a result of the strong polarization in the division of labor between the two components, managerial and clerical, this analysis leads to a Marxian theory of managerial capitalism.

Dans les societes contemporaines avancees, notamment aux Etats-Unis, qui montrent la voie, le principal canal d’extraction du surtravail est devenu le paiement de hauts salaires aux cadres des secteurs prive et public. Correlativement, la hausse des inegalites de revenus au cours des dernieres decennies est surtout due a la croissance des inegalites salariales. Ces tendances manifestent le developpement graduel de relations propres a un nouveau mode de production, le managerialisme, dont la classe dominante est celle des cadres. La notion de « capitalisme managerial » est l’expression de l’hybridite des relations de production actuelles. Les principes fondamentaux de la theorie de l’histoire de Marx sont ainsi preserves au prix d’une « revision » majeure. Ces transformations expliquent pourquoi et comment les propheties du Manifeste relatives a la disparition des societes de classe ne se sont pas realisees : le capitalisme se metamorphose dans une nouvelle societe de classe.

The paper presents a formal generalization of Marx's analysis of exploitation and prices in economies in which categories of labor are distinguished according to their unequal ability to create exchange value. Measures of exploitation of categories of labor which are consistent with both the Price of Net Product-Unallocated Purchasing Power (PNP-UPP) (New Interpretation) and the traditional interpretation of Marx's theory of value are defined which aggregate consistently over labor categories and sectors. In order to measure rates of exploitation from real economic data some additional assumption about relative rates of exploitation (which Marx often explicitly assumes to be equal) is required.

O neoliberalismo é uma nova fase do capitalismo, que se impôs a partir do começo dos anos 1980. Considerando seus traços mais gerais nos países do Centro, como nos Estados Unidos e na Europa, destacam-se três características: uma dinâmica mais favorável da mudança tecnológica e da rentabilidade, a criação de rendas a favor das classes mais abastadas, e a redução da taxa de acumulação. O imperialismo na era neoliberal pode se caracterizar pela hegemonia dos Estados Unidos, que drenam fluxos enormes de renda do resto do mundo. Mas esse domínio é solapado pelos desequilíbrios externos crescentes do país, a expressão de uma onda extraordinária de consumo por parte das famílias. Neoliberalism is a new phase of capitalism which was asserted at the beginning of the 1980s. Considering its more general features as in the United States and Europe, it can be characterized by: a more favorable dynamic of technical change and profitability, the creation of income flows to the benefit of the most accommodated classes of the population, and diminished rates of accumulation. A central feature of imperialism in the neoliberal era is U.S. hegemony, a country which is draining huge flows of income from the rest of the world. This domination is, however, undermined by increasing external disequilibria, the expression of an extraordinary wave of consumption from households.

At the turn of the 21st century, US imperialism appears very strong. The paper focuses on economic mechanisms. Both direct investment abroad and portfolio investment contribute extensively to the remuneration of capital in the United States, under the form of interest, dividends and profits of transnational corporations retained abroad. The rates of return on these investments are high, in particular when compared to the returns of foreigners when they invest in the United States. The major contradiction results from the growing external trade imbalance. The outflow of dollars to the rest of the world is invested back in the country by foreigners. Their stock of assets on the United States is now the double of the stock of assets of this country on the rest of the world; the flow of income paid to foreigners is equal to that received from the rest of the world. These deficits are due to the tremendous wave of consumption by the richest fraction of the population, which followed the restoration of the inco...

Financial relations considerably alter the profile of the profit rate of nonfinancial corporations. Large rates are maintained to the end of the 1970s. Conversely, rates are diminished during the 1980s and 1990s. The average value of the profit rate of the financial sector is similar, though lower during the 1970s, due to low real interest rates and a stagnating stock market. The opposite is true during the neoliberal decades.

Resume La baisse du taux de profit depuis la Seconde Guerre mondiale est maintenant un phenomene largement reconnu, et l’existence d’une nouvelle tendance a la hausse est desormais identifice. Cette etude propose de nouvelles estimations du taux de profit dans une definition proche de celle utilisee par Marx au livre III du Capital, ou les profits correspondent a la plus-value totale, et une definition plus proche de la pratique des entreprises, prenant en compte les interets, les impots et les stocks. On montre que les taux de profit d’un sous-ensemble de branches (comme les Chemins de fer), dont le rapport capital-travail est particulierement eleve et qu’on nomme branches hautement capitalistiques, sont tout a fait differents de ceux des autres branches, tant en niveau qu’en tendance (leur taux de profit est tres bas et n’a pas baisse). La baisse du taux de profit et sa remontee partielle peuvent etre plus clairement saisies, lorsque ces branches sont eliminees. Au total, entre 1948 et 1982, le taux de profit fut divise par un coefficient compris entre 2 et 7, selon les secteurs et les definitions du taux de profit consideres. En 2000, le taux profit n’a encore retrouve que la moitie de sa valeur de 1948. On montre enfin que la baisse de la productivite du capital fut le principal facteur de la chute du taux de profit, bien que la baisse de la part des profits ait egalement contribue a cette evolution.

Robert Brenner's analysis of the structural crisis of the late 20th century, in his Economics of Global Turbulence, is based on the observation of the decline of the profit rate, as is common among Marxist economists. Instead of the usual reference to the features of technical change, Brenner explains the decline of the profit rate in the whole economy by its fall within manufacturing industries, resulting from excess international competition. Brenner's basic insight is based on the observation that, after World War II, in the United States, the profit rate of manufacturing industries was larger than in other U.S. industries, and declined considerably more. This observation follows from a misinterpretation of profit rate differentials. Actually, the profit rate of manufacturing industries was not significantly different from that of most other industries, with the exception of a group of very capital intensive industries such as railroads, which accounts for only 13 percent of total output. This difference, which remains to be explained, has nothing to do with international competition.

The current crisis is one of the great crises punctuating the long history of capitalism, and to be properly understood it is vital to take into account its ongoing structural transformation. This book offers plural perspectives on the Great Recession, placing the analysis of finance, class and gender at the center of the debate. It begins with a comprehensive insight into the crisis, before moving on to focus on debt, asset inflation and financial fragility. Following chapters discuss global imbalances, structural monetary reform and the management of public finance, including a investigation of the Italian experience. The book concludes with novel contributions on the gender dimension of the crisis and the analogies between a nuclear and financial chain reaction.

International audience; Bruno Tinel questions Duménil and Lévy (DL) about their new book, La Découverte. Besides the paths currently taken by the United-States and Europe in the wake of the 2008 crisis --the continuation of a dynamics weighted in favour of upper classes --there is an alternative path to the left that is here opened up : hence the "bifurcation". DL go further in their Marxist-inspired diagnosis. Neoliberalism is described as a social order strategically biased to the power and income of capitalist classes and their allies, the managerial classes. The book draws a contrast between American-English neoliberalism and the configurations observed in Europe. A series of new findings provides the basis for a concrete analysis of the worldwide structures of ownership and control ; the crisis in Europe is investigated by way of the contrasting trajectories of France and Germany, while special emphasis is placed on the Spanish economy. DL argue that, as was the case in the decades immediately following World War II, a new alliance between popular and managerial classes is required, to be established at a European level, but with the aim of transcending the latter level.

This paper criticizes Brenner's emphasis on competition within Manufacturing in his analysis of the falling profit rate, and the subsequent extension of this fall to the entire economy. His assumptions concerning price competition appear arbitrary and proofs are deficient. Brenner cannot escape the reliance on the rise of wages, contrary to what he contends in his criticism of profit-squeeze theory. Several basic theoretical issues, such as adjustment by prices (as in neoclassical models) or by quantities produced (as in Keynesian models), partial or general analysis are not treated properly. For Marx, the decline of the profit rate causes competitive wars; the inverse relationship is posited by Brenner.

Neoliberalism is the ideological expression of the return to hegemony of the financial fraction of ruling classes. The meaning of this movement can only be understood from a historical perspective. Modern finance, linked to the real economy, appeared in the wake of the structural crisis of the late nineteenth century. It lost its unrivalled domination, when the Keynesian compromise was ushered in by the succession of the great depression and World War II. Its return to power followed the crisis which began in the 1970s. The class character of neoliberalism is evident from an examination of the available figures. It prolonged the deficient profit rates of non-financial corporations and, thus, slow growth and unemployment. It was responsible for the deficits and the growing indebtedness of the states, as well as for the crisis of the debt of Third World countries, etc. But not enough attention has been paid to the benefits that finance gleaned from its return to hegemony during the crisis: the stunning rise...

This paper is a critique of Alan Freeman's theory of sequential values. In this approach value is conserved from period to period independently of technical change and disequilibrium, contrary to the traditional view that values are reevaluated at each period depending on the existing conditions of production. Our main criticism is that sequential values fail to account for the devaluation of capital, when the economy is considered globally. Devaluation is possible for individual commodities in Freeman's framework, but the loss of value is always compensated by a corresponding gain for another commodity. The paper also points out a number of puzzling properties of sequential values, in particular the compatibility of increasing values with rising labor productivity. The unusual treatment of fixed capital, in which fixed capital is assimilated to an imperishable raw material, also raises serious problems for Freeman.

We analyse the relationship between the Keynesian (post-Keynesian, Kaleckian) and classical perspectives, emphasizing the distinction between two time frames, short term and long term. A model is presented in which the traverse to a long-term classical equilibrium, with prices of production, is obtained as a sequence of short-term Keynesian equilibria (in which outputs are adjusted to demands). In the short term, prices and capital stocks are constant; they are only adjusted in the long term. Prices respond to disequilibria concerning capacity utilization rates. Investment is subject to a financing constraint, in which the provision of loans by the banking system is involved. Loans are modified in response to inflation (monetary policy).

This paper discusses one important component of the analysis of the decline of the profit rate in recent decades in Robert Brenner's Economics of Global Turbulence. Our single focus in this paper is Brenner's implicit theory of distribution.

In the modern literature on investment, a distinction is normally made between neo-Classical and Keynesian theories of investment. An earlier original approach can, however, be located in the works of Smith, Ricardo, and Marx. In this Classical tradition, investment is subject to a capital constraint, and capitalists allocate their capital according to the relative profitability of the various industries. We show that this behaviour is rational in a model in which capitalists optimize over an infinite horizon and form rational expectations: inter-industry mobility can be expressed as an adjustment behaviour such that investments, ΔKi are proportional to profitability differentials: ΔKi = Ai (r¯i−r¯)