The Hegelian Dialectic and Evolutionary Economic Change

Abstract

The Hegelian dialectic of thesis-antithesis-synthesis can provide a perspicacious framework for analyzing the evolutionary process of economic change as envisaged in many theories of growth and development from David Hume and David Ricardo to Joseph Schumpeter. An evolution of economic structure is a perpetual sequence of change with constant contradictions, selftransformation, and self-organization. The same dialectic is applied to the "flying-geese" paradigm of industrial upgrading (an emended version of Akamatsu's original model) that explains Japan's postwar process of structural transformation and upgrading, a process full of contradictory developments and incessant adjustments occurring at both the market (unconscious coordination) and the policy (conscious coordination) level. * This is a revised version of the presidential address delivered at the 13th International Conference

Economic Cycles, Crises, and the Global Periphery

“…Akamatsu's original new contribution to the Kondratieff cycle debate is his analysis of the "differentiation" of the world economy (Akamatsu, 1961(Akamatsu, , 1962 ; see also Arrighi, Silver, & Brewer, 2003 ;Kasahara, 2004 ;Krasilshchikov, 2014 ;Ozawa, 2004Ozawa, , 2013Schroeppel & Nakajima, 2002 ).…”

“…Akamatsu sees a counter-movement in other parts of the world, centered on the rising production of gold, which, according to him, leads to an increase in effective demand and further stimulates exports of the innovating nation. In that way, world production and trade expand, prices increase and a world-wide rise in the long-term trade cycle results (see Arrighi, Silver, & Brewer, 2003 ;Kasahara, 2004 ;Krasilshchikov, 2014 ;Ozawa, 2004Ozawa, , 2013Schroeppel & Nakajima, 2002 ).…”

“…For Akamatsu, the characteristic structure of the Center-Periphery relationship, which he more deeply analyzes also in his publication (Akamatsu, 1962 ), is characterized by the fact that the underdeveloped nation will export primary products and will import industrial goods for consumption (see Arrighi, Silver, & Brewer, 2003 ;Kasahara, 2004 ;Krasilshchikov, 2014 ;Ozawa, 2004Ozawa, , 2013Schroeppel & Nakajima, 2002 ). However, the role of foreign capital received little attention in Akamatsu's theory, as he worked out his theory proceeding from the observations of the textile industry development in Japan (then still a developing rather than developed country) during the period of 40-50 years starting from the late nineteenth century.…”

“…The sec ond is the sequence from consumer goods to capital goods and from crude and simple articles to complex and refi ned articles. The third is the alignment from the advanced nations to backward nations according to their stages of growth (see Arrighi, Silver, & Brewer, 2003 ;Kasahara, 2004 ;Krasilshchikov, 2014 ;Ozawa, 2004Ozawa, , 2013Schroeppel & Nakajima, 2002 ).…”

“…Discrepancies will also lead to a shift of production away from domestic industries in the underdeveloped country towards the export sector; leading, in the end, also to problems of excessive supply capacities in the underdeveloped country et cetera (see Arrighi, Silver, & Brewer, 2003 ;Kasahara, 2004 ;Krasilshchikov, 2014 ;Ozawa, 2004Ozawa, , 2013Schroeppel & Nakajima, 2002 ).…”