Monopoly Capitalism in Crisis

The world economy is on the brink of a profound crisis. The threat of global deflation and the emergence of chronic excess global capacity characterizes the contemporary phase of crisis and stagnation. Lucarelli argues that these pathological features of globalization acquire a remorseless logic during the "mature" stages of monopoly capitalism. He explores the historical origins and theoretical tendencies of this protracted crisis from a Keynes/Kakecki perspective. Cover......Page 1 Contents......Page 6 List of Tables......Page 9 List of Figures......Page 10 Acknowledgements......Page 11 Introduction......Page 12 Part I A Theoretical Critique......Page 22 Introduction......Page 24 1 The law of value revisited......Page 25 2 The tendency of the rate of profit to fall......Page 26 3 Simple and expanded reproduction......Page 33 4 The problem of effective demand......Page 35 Conclusion......Page 40 Appendix 1A Expanded reproduction......Page 41 1 Neoclassical and the "new" endogenous growth theories......Page 43 2 The law of increasing returns......Page 48 3 Endogenous technical change......Page 51 4 The role of effective demand and net exports......Page 54 Conclusion......Page 58 Appendix 2A The Solow/Swan model......Page 59 Introduction......Page 62 1 The determination of national income: a Kaleckian model......Page 63 2 Oligopoly and stagnation......Page 67 3 The credit cycle and the onset of debt deflation......Page 71 Conclusion......Page 78 1 "Creative destruction"......Page 79 2 Oligopoly and technical progress......Page 89 Conclusion......Page 94 Appendix 4A Harrod's theory of the trade cycle......Page 95 Appendix 4B Classification of technical progress......Page 97 Part II The Era of Stagnation and Crisis: 1975–2000......Page 98 Introduction......Page 100 1 The crisis of overaccumulation......Page 101 2 The demise of the Bretton Woods accords......Page 106 3 The dollar and its rivals......Page 112 4 Third World debt and delusion......Page 115 5 A tripolar world system?......Page 120 Conclusion......Page 124 Introduction......Page 126 1 European Monetary Union: the first experiment......Page 127 2 The neoliberal ascendancy in Europe......Page 130 3 The European Monetary System: 1979–87......Page 133 4 The Maastricht blueprint for EMU......Page 138 Conclusion......Page 144 Introduction......Page 145 1 The historical context......Page 146 2 From virtuous circle to vicious circle......Page 151 3 A trans-Pacific trade war?......Page 159 Conclusion......Page 167 1 The privileges of US financial hegemony......Page 169 2 A hegemonic crisis?......Page 173 Conclusion......Page 178 Notes......Page 179 Bibliography......Page 182 C......Page 194 E......Page 195 G......Page 196 J......Page 197 M......Page 198 S......Page 199 T......Page 200 Y......Page 201 Cover 1 Contents 6 List of Tables 9 List of Figures 10 Acknowledgements 11 Introduction 12 Part I A Theoretical Critique 22 1 Accumulation and Crisis: Marxian Controversies 24 Introduction 24 1 The law of value revisited 25 2 The tendency of the rate of profit to fall 26 3 Simple and expanded reproduction 33 4 The problem of effective demand 35 Conclusion 40 Appendix 1A Expanded reproduction 41 2 Circular and Cumulative Causation 43 Introduction 43 1 Neoclassical and the "new" endogenous growth theories 43 2 The law of increasing returns 48 3 Endogenous technical change 51 4 The role of effective demand and net exports 54 Conclusion 58 Appendix 2A The Solow/Swan model 59 3 Overaccumulation and Crisis 62 Introduction 62 1 The determination of national income: a Kaleckian model 63 2 Oligopoly and stagnation 67 3 The credit cycle and the onset of debt deflation 71 Conclusion 78 4 Long Cycles of Growth and Stagnation? 79 Introduction 79 1 "Creative destruction" 79 2 Oligopoly and technical progress 89 Conclusion 94 Appendix 4A Harrod's theory of the trade cycle 95 Appendix 4B Classification of technical progress 97 Part II The Era of Stagnation and Crisis: 1975–2000 98 5 The Demise of Pax Americana 100 Introduction 100 1 The crisis of overaccumulation 101 2 The demise of the Bretton Woods accords 106 3 The dollar and its rivals 112 4 Third World debt and delusion 115 5 A tripolar world system? 120 Conclusion 124 6 The Onset of "Eurosclerosis" 126 Introduction 126 1 European Monetary Union: the first experiment 127 2 The neoliberal ascendancy in Europe 130 3 The European Monetary System: 1979–87 133 4 The Maastricht blueprint for EMU 138 Conclusion 144 7 The US–Japanese Axis: Unity or Rivalry? 145 Introduction 145 1 The historical context 146 2 From virtuous circle to vicious circle 151 3 A trans-Pacific trade war? 159 Conclusion 167 Conclusion: the Coming Crisis 169 Introduction 169 1 The privileges of US financial hegemony 169 2 A hegemonic crisis? 173 Conclusion 178 Notes 179 Bibliography 182 Index 194 A 194 B 194 C 194 D 195 E 195 F 196 G 196 H 197 I 197 J 197 K 198 L 198 M 198 N 199 O 199 P 199 R 199 S 199 T 200 U 201 V 201 W 201 Y 201 Influenced by the seminal ideas of Keynes, Kalecki and Baran/Sweezy, Monopoly Capitalism in Crisis develops a succinct argument of the origins and causes of the contemporary global crisis. Keynes's original insights are woven into a grand synthesis with the "stagnationist" approach pioneered by Baran and Sweezy and are further reinforced by introducing Fisher's debt-deflation theory of great depressions and Minsky's financial instability hypothesis. The essential kernel of the argument is that under the mature stages of the evolution of monopoly capitalism and in the absence of powerful countervailing forces (ie, technical innovation, market expansion, etc), the natural tendency is towards economic stagnation. This conclusion is doubtless the very opposite of the neoliberal claim that the market economy tends toward full employment equilibrium in the long run "Influenced by the seminal ideas of Keynes, Kalecki and Baran & Sweezy, Monopoly Capitalism in Crisis develops a succinct argument of the origins and causes of the contemporary global crisis. Keynes's original insights are woven into a synthesis with the 'stagnationist' approach pioneered by Baran and Sweezy and are further reinforced by introducing Fisher's debt-deflation theory of great depressions and Minsky's financial instability hypothesis. The essential kernel of the argument is that under the mature stages of the evolution of monopoly capitalism and in the absence of powerful countervailing forces (such as technical innovation and market expansion), the natural tendency is towards economic stagnation. This conclusion is the very opposite of the neoliberal claim that the market economy tends toward full employment equilibrium in the long run."--Jacket The world economy is on the brink of a profound crisis. The threat of global deflation and the emergence of chronic excess global capacity characterizes the contemporary phase of crisis and stagnation. Bill Lucarelli argues that these pathological features of globalization acquire a remorseless logic during the "mature" stages of monopoly capitalism. He explores the historical origins and theoretical tendencies of this protracted crisis from a Keynes/Kakecki perspective