Financialisation and inequality in Australia
Westcott, Mark and Murray, John LU
(2017)
In The Economic and Labour Relations Review
28(4).
p.519-537
- Abstract
- The process of financialisation has been cast as a major contributor to increasing inequality of wealth and income in a number of advanced industrialised economies, but the nature of the link requires precise clarification. In this article, we argue that financialisation in Australia has advanced inequality, but in a particular way. Charting several features of ‘financialisation of the macroeconomy’, we accept that this process has contributed to increased inequality in the sense that the wealthy have increased their wealth faster than households and individuals at the lower end of the wealth distribution. However, there is limited Australian evidence to suggest that income redistribution has occurred as a result of the ‘financialisation... (More)
- The process of financialisation has been cast as a major contributor to increasing inequality of wealth and income in a number of advanced industrialised economies, but the nature of the link requires precise clarification. In this article, we argue that financialisation in Australia has advanced inequality, but in a particular way. Charting several features of ‘financialisation of the macroeconomy’, we accept that this process has contributed to increased inequality in the sense that the wealthy have increased their wealth faster than households and individuals at the lower end of the wealth distribution. However, there is limited Australian evidence to suggest that income redistribution has occurred as a result of the ‘financialisation of the firm’. At the level of the firm, increased inequality of wealth can be attributed directly to financialisation if firm practices are oriented to increasing shareholder value at the expense of returns to other stakeholders such as workers or suppliers, and increased income inequality can be linked specifically to financialisation through increases in earnings to financial agents. We suggest several reasons for the relative absence of a firm-level dimension of financialisation but caution that such a trend remains possible, particularly if regulation of the labour market is weakened. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/2b9c0d9d-fdeb-4697-ac40-c2e3c105c16e
- author
- Westcott, Mark
and Murray, John
LU
- publishing date
- 2017
- type
- Contribution to journal
- publication status
- published
- subject
- in
- The Economic and Labour Relations Review
- volume
- 28
- issue
- 4
- pages
- 519 - 537
- publisher
- SAGE Publications
- external identifiers
-
- scopus:85035109240
- ISSN
- 1838-2673
- DOI
- 10.1177/1035304617710417
- language
- English
- LU publication?
- no
- id
- 2b9c0d9d-fdeb-4697-ac40-c2e3c105c16e
- date added to LUP
- 2024-02-14 10:42:24
- date last changed
- 2024-02-15 13:06:56
@article{2b9c0d9d-fdeb-4697-ac40-c2e3c105c16e,
abstract = {{The process of financialisation has been cast as a major contributor to increasing inequality of wealth and income in a number of advanced industrialised economies, but the nature of the link requires precise clarification. In this article, we argue that financialisation in Australia has advanced inequality, but in a particular way. Charting several features of ‘financialisation of the macroeconomy’, we accept that this process has contributed to increased inequality in the sense that the wealthy have increased their wealth faster than households and individuals at the lower end of the wealth distribution. However, there is limited Australian evidence to suggest that income redistribution has occurred as a result of the ‘financialisation of the firm’. At the level of the firm, increased inequality of wealth can be attributed directly to financialisation if firm practices are oriented to increasing shareholder value at the expense of returns to other stakeholders such as workers or suppliers, and increased income inequality can be linked specifically to financialisation through increases in earnings to financial agents. We suggest several reasons for the relative absence of a firm-level dimension of financialisation but caution that such a trend remains possible, particularly if regulation of the labour market is weakened.}},
author = {{Westcott, Mark and Murray, John}},
issn = {{1838-2673}},
language = {{eng}},
number = {{4}},
pages = {{519--537}},
publisher = {{SAGE Publications}},
series = {{The Economic and Labour Relations Review}},
title = {{Financialisation and inequality in Australia}},
url = {{http://dx.doi.org/10.1177/1035304617710417}},
doi = {{10.1177/1035304617710417}},
volume = {{28}},
year = {{2017}},
}