Table 4: Financialisation and the gross profit share – a Kaleckian perspective Determinants of the gross profit share (including (top) management salaries) 1) Mark-up 2) Price of 3) Sector imported Stylized facts 1.a) 1.b) 1.c) of Degree of Overhead raw price power costs and materials of the and (1.-7.) and and gross neo- in the activity of profit liberalism (8.-9.) goods trade targets products 1. Increasing market union shareholder … + + … … value orientation and short-termism of management 2. Rising … … + … … dividend payments 3. Increasing … … + … … interest rates or interest payments 4. Increasing … … + … … top management salaries 5. Increasing relevance of … + … ... + financial to non- financial sector (investment) 6. Mergers + ... … ... ... and acquisitions 7. Liberalisation – + … +/– +/– and globalisation of 8. international Deregulation … + … … … finance and of the labour trade 9. market Downsizing … + ... … + of Notes: government + positive effect on the gross profit share, – negative effect on the gross profit share, … no direct effect on the gross profit share Source: Hein (2014a, p. 15) Second, the increase in management salaries as a part of overhead costs, together with rising profit claims of the rentiers, i.e. rising interest and dividend payments of the
Table 4: Financialisation and the gross profit share – a Kaleckian perspective Determinants of the gross profit share (including (top) management salaries) 1) Mark-up 2) Price of imported raw materials and products 3) Sector of the Stylized facts of (1.-7.) and neo- liberalism (8.-9.) 1.a) Degree of price in the goods market 1.b) power and activity of trade union 1.c) Overhead costs and gross profit targets 1. Increasing shareholder value orientation and short-termism of management … + + … … 2. Rising dividend payments … … + … … 3. Increasing interest rates or interest payments … … + … … 4. Increasing top management salaries … … + … … 5. Increasing relevance of financial to non- financial sector (investment) … + … ... + 6. Mergers and acquisitions + ... … ... ... 7. Liberalisation and globalisation of international finance and trade – + … +/– +/– 8. Deregulation of the labour market … + … … … 9. Downsizing of government … + ... … + Notes: + positive effect on the gross profit share, – negative effect on the gross profit share, … no direct effect on the gross profit share Source: Hein (2014a, p. 15) Second, the increase in management salaries as a part of overhead costs, together with rising profit claims of the rentiers, i.e. rising interest and dividend payments of the
financialisation_and_income_distribution_germany.docx