Rethinking Financial Capitalism and the "Information" Economy

This talk examines the popular idea that economic growth can continue indefinitely in post-industrial capitalist economies through the shift of labor to service sectors, particularly finance and information-based activities, in the light of the classical-Marxian theory of value and the related categories of productive and unproductive labor. As the generally accepted classical theory of land rent exemplifies, many types of income in capitalist economies, including interest, financial fees, speculative trading profits, and intellectual property royalties, arise as parts of the surplus value generated by the exploitation of productive labor appropriated through the assertion of various property rights. The dramatic phenomena of highly profitable business models based on network externalities associated with the internet and other information-based technologies do not represent new modes of value production, but modes (in some cases not particularly new) of participation in the pool of surplus value. National income accounting conventions that impute a fictitious output as a counterpart to incomes generated in sectors such as finance, professional and business services, education and health, and government, where there are no market-based measures of output create a distorted and misleading picture of value production and growth in advanced capitalist economies. A clear understanding of the origin of value in the expenditure of productive labor and of surplus value in the exploitation of productive labor is essential to thinking through the problems of post-industrial capitalist growth, distribution, resource conservation, and environmental protection.