What would Kondratieff do? Navigating the craziest long-cycle in history
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Transcript of What would Kondratieff do? Navigating the craziest long-cycle in history
“Each new cycle takes place under new concrete-
historical conditions, at a new level in the
development of the productive forces, and hence
is by no means a simple repetition of the preceding
cycle.”(1926)
Long cycle (inflection point)
TECH INNOVATION
- BROAD APPLICATION OF NEW TECH- “REORGANISATION” OF PRODUCTION
EXPANSION OF GLOBAL MARKET
EXPANSION OF MONEY SUPPLY
Long cycle (causation)
CAPITAL ACCUMULATESFASTER THAN INVESTMENT(GETS LOCKED IN FINANCIAL SYSTEM)
SEARCH FOR NEWTECHNOLOGY
SEARCH FOR NEW MARKETS
SEARCH FOR CHEAP MONEY
CAPITAL FLOWS INTOPRODUCTIVE NEW BUSINESSES
Romer (1990)
Information goods destroy price formation mechanism based on scarcity
High information content to
physical goods
Corporate responses
“Skate on the edge of chaos” Between falling prices/ expanding
demand Primark (Associated British Foods)
The key contradiction in modern capitalism is between this emerging possibility of free, socially produced abundant goods, and a system of monopolies, banks and governments forced to behave desperately to maintain “information asymmetry”.
That is, everything is pervaded by a fight between network and hierarchy.
Gartner 2013
“By 2020, the labor reduction effect of digitization will cause social unrest and a quest for new economic models in several mature economies.
“Near Term Flag: A larger scale version of an "Occupy Wall Street"-type movement will begin by the end of 2014, indicating that social unrest will start to foster political debate.”
http://www.gartner.com/newsroom/id/2603215
What would Nikolai expect? Pent up productivity gains
From delayed tech upswing Wages drag on growth The collaborative eats the
commercial But not everywhere
Medicine, human services and materials Market forces penetrate personal life
De-financialisation?