Real and Financial Determinants of the Profit Share of Income: The Financial Profit Squeeze

This paper conducts a causal analysis of determinants of the profit share of income for nonfinancial corporations in the Neoliberal era. The analysis focuses on power relations across and amongst three classes: labor, industrial capitalists and financial capitalists. Particular attention is paid to the multidimensional power spectrum of financial capitalists. Regression results establish a financial profit squeeze, the specific elements of financial capitalist’s power responsible for the squeeze and the pervasive nature of low road labor strategies in the Neoliberal era.