Finance Capitalism and Income Inequality in the Contemporary Global Economy: A Comparative Study of the USA, South Korea, Argentina and Sweden

This book explores the causes of rising income inequality in industrialized, developing, and emerging economies, tracing the development of finance capitalism over the last 40 years. It presents a comparative analysis of how financialization facilitates uneven capital accumulation and generates conditions that increase income inequality, with case studies from the USA, South Korea, Argentina, and Sweden.

Format: Hardback
Length: 228 pages
Publication date: 16 February 2023
Publisher: Springer International Publishing AG

This comprehensive book delves into the intricate factors contributing to the growing disparities in income levels across industrialized, developing, and emerging economies. By examining the evolution of finance capitalism over the past four decades, the author sheds light on how the neoliberal restructuring of national and global economies has played a pivotal role in exacerbating income inequality. Through a comparative analysis, the book showcases how financialization facilitates uneven capital accumulation and creates conditions that perpetuate income inequality. By outlining an analytical framework for the financialization-induced income inequality nexus, this text serves as a valuable resource for students and researchers interested in the fields of political economy and financial economics.

The rise of finance capitalism has been a significant factor in the increasing income inequality observed in many countries around the world. Over the past few decades, there has been a significant shift in the global economy towards a more financialized system, characterized by the growing importance of financial institutions and markets. This shift has led to a concentration of wealth and power in the hands of a small elite, while many ordinary people have seen their incomes stagnate or decline.

One of the key drivers of financialization has been the expansion of global financial markets. The global financial crisis of 2008-2009 highlighted the risks associated with these markets, but they have continued to grow and become more interconnected. This has allowed investors to move capital across borders with ease, leading to the accumulation of wealth in a few countries.

Another factor contributing to income inequality has been the growth of financialization in developing countries. Many developing countries have seen a surge in financial services, including banks, insurance companies, and investment funds. However, this growth has often been concentrated in urban areas, leaving rural and marginalized communities behind. This has led to a lack of access to financial services for many people, which has hindered their ability to participate in the economy and increase their income.

The impact of financialization on income inequality has been felt across different sectors of the economy. In the United States, for example, the top 1% of earners have seen their income increase by more than 200% since 1979, while the bottom 50% of earners have seen their income decline by approximately 10%. This has led to a growing wealth gap between the rich and the poor, which has significant social and economic consequences.

In addition to the direct impact on income inequality, financialization has also had indirect effects on other aspects of society. For example, it has contributed to the rise of corporate governance, where the interests of shareholders are prioritized over those of employees and the broader community. This has led to increased levels of inequality and has contributed to the decline of worker bargaining power.

There are several ways in which governments and policymakers can address the issue of income inequality caused by financialization. One approach is to increase regulation of financial markets to prevent excessive risk-taking and ensure that financial institutions are operating in the public interest. Another approach is to promote greater financial inclusion, by providing access to financial services for all members of society, regardless of their income or location.

In conclusion, the rise of finance capitalism has been a significant factor in the increasing income inequality observed in many countries around the world. While there are many complex factors contributing to this issue, financialization is a key driver of income inequality. By understanding the mechanisms behind financialization and taking steps.

Weight: 457g
Dimension: 210 x 148 (mm)
ISBN-13: 9783031217678
Edition number: 1st ed. 2023