ARTICLE The Real and Financial Components of Profitability

Abstract

Financial relations considerably alter the profile of the profit rate of nonfinancial corporations. Large rates are maintained to the end of the 1970s. Conversely, rates are diminished during the 1980s and 1990s. The average value of the profit rate of the financial sector is similar, though lower during the 1970s, due to low real interest rates and a stagnating stock market. The opposite is true during the neoliberal decades. JEL classification: B14; L70 Keywords: profit rate; nonfinancial enterprises; financial corporations; gravitation; prices of production; competition; foreign direct investment in the U.S. 1

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