The paper argues that global Neoliberalism creates both chronic sluggish aggregate demand growth and chronic excess aggregate supply, and that these tendencies reinforce one another in a vicious circle. Stagnant global demand has unleashed destructive competition in core global markets, creating low profits, financial fragility, and over investment. Over investment generates the excess industry supply that sustains competitive intensity. The greater the competitive intensity, the greater the pressure on firms to cut wages and employment, and lobby for less generous social welfare spending, which further constrains aggregate demand. And so on.
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