Monday, March 9, 2009

Long Waves and Creative Capitalism

Technological theorist and historian Carlota Perez has provided an analysis of the current global economic crisis that locates it within 50 year "long wave" theory and provides an analysis of the condition for a sustainable global boom for the 21st century. This is available here and well worth a read.

Long wave theories were first developed by the Russian economist Nikolai Kondratiev, who was executed by Stalin for his troubles. They were subsequently developed by the Austrian economist Joseph Schumpeter as well as the Marxist Ernest Mandel. Carlota Perez and Chrstopher Freeman have been pioneers in linking this work to technological developments, around the concept of techno-economic paradigms.

2 comments:

Tony said...

Schumpeter is all the rage at the moment, and rightly so! His analysis (and that of Perez) is the only stuff I've read that adequately explains the system breakdown we’re seeing by explaining long waves of development. At http://www.opendemocracy.net/article/crisis-as-prelude-to-a-new-golden-age Mary Kaldor, of the LSE, does an admirable job of constructing an explanation and a way through the current crisis based on both Perez’s and Schumpeter's work. Particularly, how the collapse of the global financial system is an entirely inevitable outcome of our final transition to the next long wave - our era of information and telecommunications technologies. BTW Terry, while Australians would love to claim ownership of a man who described himself as Europe’s greatest horseman, its greatest lover and probably its greatest economist, we should probably admit that Schumpeter was Austrian, and not Australian.

Terry Flew said...

Thanks Tony. I'll check out the Mary Kaldor reference and tidy up dubious claims about Professor Schumpeter. If he was a lover and a horseman and around just before WWII started, I'm surprised he didn't get a role in Baz Luhrmann's 'Australia'.