The concept of differential accumulation emphasizes the powerful drive by dominant capital groups to beat the average and exceed the normal rate of return.
The pace of accumulation therefore depends on two factors: (a) the institutional arrangements affecting profit expectations; and (b) the normal rate of return used to discount them into their present value.
The effect of rising industrial capacity on these factors is not only highly complex and possibly non-linear, but its direction can be positive as well as negative.
This gives us four categories of differential accumulation: internal breadth by amalgamation (buy or join other businesses), external breadth through greenfield investment (build new factories), internal depth via cost-cutting (make workers work harder or find ways to reduce the price of inputs), and external depth through stagflation (raise prices faster than the competition).
Since the 20th century, the dominant capital group which has benefited from stagflation has been the "weapondollar-petrodollar coalition" during periods of Mid-east crises and rising oil prices.
One effect of cumulative mergers and acquisitions is that can result in concentrating the power to limit supply among fewer entities.
Nitzan and Bichler state that the 2002 ratio of total debt to GDP in the US reached 290% - compared with 165% on the eve of the Great Depression.
Gardiner Means (1935) showed in his study of the US during this period: smaller firms with little market power saw falling prices and only a moderate drop in output.
Mergers had been in hibernation since early 2000s, which resulted in a greater reliance on the socially disruptive tool of inflation as stagflation.
The soaring price of oil from 2004 to 2008 helped to sustain inflation, but with a looming threat of cheap manufactured goods from developing countries.