Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/287769 
Year of Publication: 
2024
Series/Report no.: 
Working Paper No. 229-2024
Publisher: 
Hochschule für Wirtschaft und Recht Berlin, Institute for International Political Economy (IPE), Berlin
Abstract: 
In this paper, we examine if and to what extent the Kaleckian theory of mark-up pricing can explain changes in functional income distribution in an environment of financialization. Following this approach, we expect financialization to influence the aggregate wage share through three channels: (1) sectoral recomposition, (2) financial overhead costs and rentiers' profits claims, and (3) bargaining power of trade unions and workers. We empirically analyze the long-term trends for each of the channels before and after the Great Financial Crisis and the Great Recession for Austria and Finland. Overall, we find evidence for all three re-distributional channels contributing to the changes in functional income distribution. The explanatory power of the individual channels, however, differs strongly due to the heterogeneity of the countries.
Subjects: 
Finance-dominated capitalism
financialization
distribution
financial and economic crisis
Kaleckian theory of distribution
JEL: 
D31
D33
D43
Document Type: 
Working Paper

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