Luigi Salvati

Marxian economics has been dealing extensively with the issue of falling profitability and its connection with financialisation. One finds in this line of research contributions linking financialisation with the list of counter-elements to the Law of the Tendency of the Rate of Profit to Fall, with financialisation being interpreted as the ‘sixth’. In the past, various authors have either briefly commented on the ‘sixth’ factor or left it aside. We aim to provide an alternative interpretation, based on three elements. First, the role of joint-stock companies’ issuance of long-term financing instruments yielding low remuneration. Second, the fact that sectors such as railways and public utilities, belonging to the category of natural monopolies, are excluded from gravitation towards an average rate of profit. Third, the role of the organic composition of capital in determining differences in sectoral profitability. Therefore, we claim that the sixth element should be read as a reference to natural monopolies remaining outside the field of profit rate equalisation.