Chapter 1 Conceptual issues and preliminary observations
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The terms “financialisation”, “finance-dominated capitalism” and “finance-led capitalism” imply that a dominant and central role is played by the financial sector in the economy. The term “financialisation” may be used in more than one sense to refer to globalised financial markets, the growing significance of shareholder value in management decision making and corporate strategy, and rising financial investment and income generated from financial transactions. It also reflects the difference between financial capitalism and industrial capitalism. Although some policy makers believe that financialisation occurs naturally as the economy moves away from manufacturing industry to services, it is far away from being a “natural development” - rather, it is a consequence of public policy choices.