Iranian-German economist Mohssen Massarrat has published in Persian his new theory on finance capitalism.
Massarrat, 75, is an emeritus professor of politics and economy at Osnabruck University, a renowned public research institution in the German city of Osnabruck, Lower Saxony.
His research areas are political economy, social-ecological economy, sustainable development, democracy theory, globalization and international economic relations, peace and conflict.
Massarrat has always focused on contemporary developments in the world and in particular the Middle East. He has published over 400 articles and books.
His new book ‘Finance Capitalism as New Formation of Capitalism,’ has been brought out by the Tehran-based publishing house ‘Naqd-Farhang’, IBNA reported.
The renowned economist was present during the launch of his new book on Monday in Tehran. The publishing house in collaboration with the International Affairs Department of the Institute for Humanities and Cultural Studies, organized the event.
Other prominent figures present included writer Mahmoud Dowlatabadi, 76; economist, author and researcher in poverty and social justice Hossein Raghfar, 64, who is a faculty member of Al-Zahra University in Tehran; economist and author Farshad Momeni, 62, a faculty member of Economics Department at Allameh Tabatabai University in Tehran; and philosopher Mohammad Ali Moradi.
Classical Capitalism Different
Elaborating on his new theory, Massarrat said: “Classical capitalism with its financing and banking system is quite different from finance capitalism. The latter is non-productive and has turned into a market for virtual commodities such as finance investment, private equity funds, hedge funds and pension funds.
What matters most in finance capitalism is to transfer the capital and change its direction. Wealth is thus moved by finance capitalism from production processes to finance investment.”
According to Massarrat, the essential difference between productive economy and finance economy is that the latter “does not produce added value. Theorists call it a win-lose game; while classical or productive capitalism is based on a win-win game.”
The basis of finance capitalism, he added, is accumulation of money for profit. For this purpose, political leverage and other means of power are used.
Consequence of Finance Capitalism
The consequences of finance capitalism can be observed in massive unemployment, started in 1980’s, subordination of labor syndicates, wage dumping in capitalist countries and a large profit margin for investors.
Among the other consequences, Massarrat mentioned the highly uneven distribution of wealth, states in debt, sovereignty of the rich over governments, reduction in social budgets, job insecurity, anxiety and uncertainty about future.
“Other results of finance capitalism in the economy, society and politics are blocked reform movements, passive social role of the youth and students, parasitic life of the jobless, increased poverty particularly among the elderly, dominance of right-wingers, spread of populism and above all, rise of nationalistic movements, even fascism,” Massarrat added.
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