Financialisation as Monopoly Profit: The Case of US Banking

Different economic measures afford different ways of seeing processes of financialisation. In the prototypical case of the US economy, the most compelling evidence of post‐1970s financialisation is found in corporate profits measures. This much has been clear for at least a decade. What remains much less clear, however, is the explanation for the long‐term maintenance and amplification of extreme financial‐sector profitability that financialisation in the United States has and continues to entail. With a specific focus on banking, this article turns to post‐Marxian scholarship on profit rate trends to explain this phenomenon. It argues that limited and declining levels of competition within the US banking sector during recent decades—rooted in high levels of industry concentration, collusive behaviour, and substantial entry barriers—have contributed to sustaining and boosting abnormal sectoral profitability. In doing so, the article theorises financialisation in the United States explicitly in terms of monopoly profit.