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Till van Treeck (2009) A synthetic, stock-flow consistent macroeconomic model of financialisation”, Cambridge Journal of Economics, vol. 33, n. 3
JEL: E21, E22, E25, G32, G35
Abstract: This article is centred around the notions of shareholder value orientation and financialisation. Shareholder value orientation is reflected by a high dividend payout ratio applied by firms and the reluctance of firms to finance new investment via new equity issues. Financialisation is the more general development towards an increased importance of the financial sector of the economy relative to the non-financial sector. In this article, a synthetic, stock-flow consistent model is developed that attempts to encompass some important recent works on the effects of financialisation. This includes contribution from the fields of mainstream information economics and post-Keynesian economics. We conduct simulaations reflecting increased shareholder value orientation, and show that the results are consistent with important stylised facts.