Kondratieff, Schumpeter, and Kuznets: Trend Periods Revisited

Abstract

The analysis of fluctuations longer than the nine-year business cycle has been somewhat confused by a failure to distinguish sharply and to relate three distinct phenomena: the forces set in motion by a leading sector in growth, stemming from the introduction and progressive diffusion of a new technology, and its deceleration; the forces set in motion by changes in the profitability of producing foodstuffs and raw materials, whether from the side of prices or technology, including their effects on investment in new territories and mines, on capital movements, interest rates, terms of trade, and domestic and international income distribution; and the forces set in motion (notably, in housing and urban infrastructure) by large waves of international or domestic migration or other forces changing the rate of family formation, housing demand, and the size of the working force. As the world economy unfolded after 1783, these three phenomena operated concurrently and related to each other in complex ways not easy to disentangle. Nevertheless, the substantial literature on long waves can be usefully clarified by distinguishing these phenomena more sharply than is sometimes done and then relating them to each other at particular times and places. The exercise of doing so has, I believe, some general implications for economic theory, for they are all aspects of the process of adjustment towards a moving equilibrium, never attained—a process for which we lack an adequate dynamic theory.

An integrated theory of the economic long wave

“…Freeman et al (1982) focus on unemployment and innovation. See Rostow (1975Rostow ( , 1978 and Mandel (1980Mandel ( , 1981 for theories based on resource scarcity and class struggle, respectively. See also Freeman (1983) for a survey of contemporary long wave theories.…”

Economic Cycles, Crises, and the Global Periphery

“…5 and 6 below). There were also a number of attempts to combine capital investment and innovation theories of K-waves (e.g., Aкaeв, 2010 ;Rostow, 1975Rostow, , 1978van Duijn, 1979van Duijn, , 1981van Duijn, , 1983. Of special interest is the Devezas-Corredine model based on biological determinants (generations and learning rate) and information theory that explains (for the fi rst time) the characteristic period (50-60 years) of Kondratieff cycles (Devezas & Corredine, 2001 ; see also Devezas, Linstone, & Santos, 2005 ).…”

“…But although the topic concerned sometimes very prominent scientists such as Forrester, Rostow, or Wallerstein (Forrester, 1978Rostow, 1975Rostow, , 1978Wallerstein, 1984 ), on the whole this area has never been among the top interests of economists. Nevertheless, interest in this process continues, a new surge of interest has been associated with the work of Tessaleno Devezas. There are rather diverse opinions regarding the long cycles.…”

Life cycles and long waves

“…190£.). Secondly, provided that the Kuznets cycle exists at all, there seems to be some agreement that it is restricted to the period before World War I (see, e.g., the discussion in Rostow, 1975), while US world market hegemony has emerged during the twentieth century only and is most obvious after World War II.…”

“…[5] [6] For example, van Duijn, 1983;Freeman, 1983;Hartman and Wheeler, 1979;Kuznets, 1930;Rostow, 1975;Stewart, 1982. This particular model draws an analogy to the behavior of biological systems in using models of S-sha~growth patterns, like the logistic curve (Verhulst, 1838), used in biology to describe the growth and the dynamics of interaction of biological populations (Goell, Maitra, and Montroll, 1971;Lotka, 1910;Pearl, 1925). The theoretical basis for an application of such models in the technology and market area can be found in the concept of product life cycles as well as in the theories of the adoption and diffusion of new innovations, in both time (Rogers, 1962;Bass, 1969 and1980) and space (Higerstrand, 1967).…”