Business Ascendancy and Economic Impasse: A Structural Retrospective on Conservative Economics, 1979—87

Did conservative economics succeed in transforming the underlying structure of the U.S. economy? What have been the macroeconomic effects of this transformation? In order to make these questions clearly, this paper presents a social structural model of macroeconomic performance, which identifies and develops quantitative indicators of the key dimensions of the institutional environment of the economy and estimates the relationship of these dimensions to the behavior of key economic variables such profitability and investment. Next, this paper distinguishes among four key periods of the postwar U. S. economy: boom, erosion of the institutional structure of that boom, political and economic stalemate, and the business ascendancy. For the purpose of providing econometric support for the institutional explain of the movement of the profit rate, this paper applies conventional econometric tests to hypotheses concerning political and sociological phenomena, and characterizes the postwar social structure of accumulation in the United States as comprising four institutional relationships affecting the relative power of the capitalist class: the capital-labor accord, Pax Americana, the capital-citizen accord and the moderation of inter-capitalist rivalry.