Munich Personal RePEc Archive

The growing dichotomy between real and financial sectors

Roy Trivedi, Smita (2011): The growing dichotomy between real and financial sectors. Published in: Matrix Business Review , Vol. 1, No. 2 : pp. 27-38.

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Abstract

The paper contends that the economic growth process around the world has seen a growing dichotomy between real and financial sectors in the last four decades. There has been a marked stagnation in the real sector with falling growth and productivity levels, worsening physical investment and employment growth and dwindling saving rates. In contrast, the financial sector has seen a huge appreciation in financial assets and growing income from ownership of financial capital. The paper highlights the paradoxical coexistence of real sector stagnation with financial sector explosion.

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