- 著者
-
小林 陽介
- 出版者
- 経済理論学会
- 雑誌
- 季刊経済理論 (ISSN:18825184)
- 巻号頁・発行日
- vol.50, no.4, pp.84-95, 2014
<p>The aim of this paper is to analyze the process of the financialization of the American economy in 1980s, focusing on the relationship between corporations and financial institutions. In part I, I survey the literature of the financialization approach. One approach is to focus on the increase of financial investment by non-financial corporations. This approach points out that non-financial corporations invest internal funds to financial assets to avoid the downward tendency of profitrates. This approach is limited by scholars understanding that corporations invest in financial assets solely aiming at financial profits. The other approach is to focus on the growing influence of the capital market and the increase of financial payments by non-financial corporations. This approach emphasizes the creation of the "market for corporate control", driven by the rise of institutional investors, information economics and the formation of junk-bond market. This approach has the limitation that the actions of industrial corporations are not included. Based on these literatures, the approach of this paper is to regard investing equity as the way to control another corporation and include corporate actions which pursue profits. This approach is to focus on the transformation of "finance capital". Originally, "finance capital" had a viewpoint of finance related with industry. However, these days, "finance capital" is used in a sense that financial institutions seek financial and speculative profits. In this paper, I focus on the process of the transformation of "finance capital" from the classical type to casino type. In part II, I trace the transformation of the American economy after World War II, and corporate restructuring in 1980s. In the post-war era, the American economy was characterized by the administered price system. Administered price was the price which added reasonable profit to cost. Because of this, corporations could get stable profit. Under this system, corporate actions were characterized by avoidance of price competition, demand of protective policies, and investment in former type equipment. In the depression in early 1980s, many corporations fell into the red Most of them changed the action pattern. They restructured business formations by mergers and acquisitions(M&A). For examples, U. S. Steel acquired Marathon Oil in 1982 to change its main business from steel to oil production. Financial institutions took part in the M&A boom. Investment banks acted as M&A advisor. In merger mania, they treated bridge loan financing, and invested LBO equity funds. Commercial banks acted as loan lender. In merger mania, they acted as M&A advisor. In part III, I explain the consequences of merger boom in 1980s and examine the transformation of the relationship between corporations and financial institutions. Financial institutions expanded profits from M&A related businesses because such businesses were very profitable. In the process of merger boom, the relationship between corporations and financial institutions had transformed from "relationship oriented" to "arms-length oriented". As for investment banks, large corporations had maintained the continuous relationship with specific investment banks over a long period of time. However, in 1980s, most corporations came to use the investment banks which presented the most advantageous conditions. This was because there were many chances for corporations to change investment banks in the merger boom. The conclusion of this paper is as follows: 1) American corporations moved their capital to advantageous industries by using financial markets. 2) Financial institutions could expand profits by helping corporations which needed M & A to overcome the difficulties in that days. 3) In the process of merger booms, the relationship between</p><p>(View PDF for the rest of the abstract.)</p>