The Value of Everything: Making and Taking in the Global Economy

by Mariana Mazzucato

The first, covered in this chapter, is its expansion in absolute terms and as a share of total economic activity. Today, the sector has sprawled way beyond the limits of traditional finance, mainly banking, to cover an immense array of financial instruments and has created a new force in modern capitalism: asset management. The financial sector now accounts for a significant and growing share of the economy’s value added and profits. But only 15 per cent of the funds generated go to businesses in non-financial industries.3 The rest is traded between financial institutions, making money simply from money changing hands, a phenomenon that has developed hugely, giving rise to what Hyman Minsky called ‘money manager capitalism’.4 Or, put another way: when finance makes money by serving not the ‘real’ economy, but itself.