This book documents the growth of unproductive activity in the United States economy since World War II and its relation to the economic surplus, capital accumulation, and economic growth. Unproductive activities broadly consist of those involved in the circulation process, including wholesaling and retailing, banking and financial services, advertising, legal services, business services and many government activities. The results indicate that the level of unproductive activity in the postwar economy has been a significant factor in the slowdown in the rate (...) of capital accumulation, productivity growth and the overall growth rate. Here, the villain is shown to be the gradual but persistent shift of resources to unproductive activities. The consequence has been a reduction in new capital formation and productivity growth and an erosion in the rate of growth in per capita living standards. Moreover, the rise in unproductive activity is itself seen to be rooted in the logic of advanced capitalism. The forces of competition, which in the early stages of capitalism lead to rapid technical change and productivity growth, promote non-productive and even counterproductive activities in its more advanced stages. (shrink)

This chapter considers behavioral responses to Stakeholding. The actual effect of Stakeholder Grants on overall wealth inequality depends on what proportion of the stakes is actually saved and how gifts and bequests change in response to Stakeholding. It is likely that Stakeholder Grants partly crowd out private transfers and that a substantial portion of them is spent. If these effects are greater for the less than the more wealthy, the equalizing effects of Stakeholding will be reduced, and if these factors (...) are strong enough, they could conceivably reverse the effects of Stakeholding and increase wealth inequality. (shrink)

The media is aglow with reports of the booming economy and rising prosperity in the United States since the early 1990s. Indeed, the run-up in stock prices between 1995 and the end of 1999 has created the impression that all families are doing well in terms of income and wealth. This, however, is certainly not the case. As I shall demonstrate, most American families have seen their level of well-being stagnate over the last quarter-century.