Financial Crisis, Inequality, and Capitalist Diversity: A Critique of the Capital as Power Model of the Stock Market

Financial Crisis, Inequality, and Capitalist Diversity: A Critique of the Capital as Power Model of the Stock Market
Baines, Joseph and Hager, Sandy Brian. (2020). New Political Economy. Vol. 25. No. 1. pp. 122-139. (Article - Journal; English).

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Abstract or Brief Description

The relationship between inequality and financial instability has become a thriving topic of research in heterodox political economy. This article offers the first critical engagement with one framework within this wider literature: the Capital as Power (CasP) model of the stock market developed by Shimshon Bichler and Jonathan Nitzan. Specifically, we extend the CasP model to other advanced capitalist countries, including Germany, France, the United Kingdom, and Japan. Our findings affirm the core prediction of the CasP model, showing that unequal power relations reliably predict future stock market performance. Yet when it comes to the CasP model’s explanation of why power relations predict stock market returns, our findings are more ambiguous. We find little empirical support for the claims that capitalist power is dialectically intertwined with systemic fear, and that systemic fear and capitalised power are mediated through strategic sabotage. The main lesson of our analysis is that any model of the stock market must be attentive to the geographical unevenness and continued national diversity in capitalist development.



Publication Type

Article - Journal

Commentary on

A CasP Model of the Stock Market
Bichler, Shimshon and Nitzan, Jonathan. (2016). Real-World Economics Review. No. 77. December. pp. 119-154. (Article - Journal; English).


capital as power comparative capitalisms financial crisis inequality stock market


BN International & Global
BN Money & Finance
BN Power
BN Resistance
BN Value & Price
BN Business Enterprise
BN Capital & Accumulation
BN Conflict & Violence
BN Crisis
BN Distribution

Depositing User

Jonathan Nitzan

Date Deposited

20 May 2019 02:24

Last Modified

25 May 2020 02:13


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