chapter  20
17 Pages

Problematizing the global economy

Financialization and the “feudalization” of capital
ByRajesh Bhattacharya, Ian J. Seda-Irizarry

This chapter presents the separation thesis as a theoretical problem in the literature on financialization and briefly reviews the literature connecting financialization with global value chains and the significance of rent in corporate strategies. The dominant social forms of capital in contemporary capitalism are financial or "fictitious" capital and rent-bearing capital, which are forms farthest removed from real value-producing activities. The chapter argues that the "prevalence" of the capitalist class structure does not rule out the presence of non-capitalist class structures in the social formation. A more disaggregated analysis of the global economy can open up the debate on financialization to newer theoretical possibilities. In certain regions, financial capital may appear socially prevalent while in others industrial capital may be socially prevalent. Even those who make a connection between financialization and global value-chains fail to recognize the articulation of non-capitalist class structures in developing countries into circuits of capital dominated by capitalist firms, often headquartered in the developed countries.