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A Political-Economic Critique of Minsky's Financial Instability Hypothesis: The case of the 1966 financial crisis

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  • Edwin Dickens

Abstract

According to Minsky's financial instability hypothesis, financial crises are caused by increasing debt burdens. The purpose of this paper is to argue instead that financial crises are caused by class and intra-class conflict. The 1966 financial crisis is particularly significant, from the perspective of Minsky's financial instability hypothesis, because it divides the postwar Golden Age of US capitalism from the current period of recurrent financial crises. After showing that increasing debt burdens do not account for the 1966 financial crisis, this paper explains the 1966 financial crisis in terms of class and intra-class conflict.

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  • Edwin Dickens, 1999. "A Political-Economic Critique of Minsky's Financial Instability Hypothesis: The case of the 1966 financial crisis," Review of Political Economy, Taylor & Francis Journals, vol. 11(4), pages 379-398.
    • Handle: RePEc:taf:revpoe:v:11:y:1999:i:4:p:379-398
    DOI: 10.1080/095382599106850
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    References listed on IDEAS

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    1. Basil J. Moore, 1988. "The Endogenous Money Supply," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 10(3), pages 372-385, March.
    2. Richard C. K. Burdekin & Paul Burkett, 1996. "Distributional Conflict and Inflation," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-37173-6, December.
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    8. Hyman P. Minsky, 1992. "The Financial Instability Hypothesis," Economics Working Paper Archive wp_74, Levy Economics Institute.
    9. Albert M. Wojnilower, 1980. "The Central Role of Credit Crunches in Recent Financial History," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 11(2), pages 277-340.
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    Cited by:

    1. Edwin Dickens, 1999. "Financial Instability, Crises and the Endogeneity Of Money: A rejoinder," Review of Political Economy, Taylor & Francis Journals, vol. 11(4), pages 427-430.
    2. Beniamino Callegari, 2018. "The finance/innovation nexus in Schumpeterian analysis: theory and application to the case of U.S. trustified capitalism," Journal of Evolutionary Economics, Springer, vol. 28(5), pages 1175-1198, December.

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