BullionVault

BullionVault

Political instability may be a contributor in the coming decade The next decade is likely to be a period of growing instability in the Un...

Study From 2010 Cites 2020 As Potential Year Of Upheaval

Political instability may be a contributor in the coming decade

The next decade is likely to be a period of growing instability in the United States and western Europe, which could undermine the sort of scientific progress you describe in the Opinion collection of ‘2020 visions’. Quantitative historical analysis reveals that complex human societies are affected by recurrent — and predictable — waves of political instability (P. Turchin and S. A. Nefedov Secular Cycles Princeton Univ. Press; 2009). In the United States, we have stagnating or declining real wages, a growing gap between rich and poor, overproduction of young graduates with advanced degrees, and exploding public debt. These seemingly disparate social indicators are actually related to each other dynamically. They all experienced turning points during the 1970s. Historically, such developments have served as leading indicators of looming political instability. Very long ‘secular cycles’ interact with shorter-term processes. In the United States, 50-year instability spikes occurred around 1870, 1920 and 1970, so another could be due around 2020. We are also entering a dip in the so-called Kondratiev wave, which traces 40-60-year economic-growth cycles. This could mean that future recessions will be severe. In addition, the next decade will see a rapid growth in the number of people in their twenties, like the youth bulge that accompanied the turbulence of the 1960s and 1970s. All these cycles look set to peak in the years around 2020. Records show that societies can avert disaster. We need to find ways to ameliorate the negative effects of globalization on people’s well-being. Economic inequality, accompanied by burgeoning public debt, can be addressed by making tax rates more progressive. And we should not expand our system of higher education beyond the ability of the economy to absorb university graduates. An excess of young people with advanced degrees has been one of the chief causes of instability in the past.

- Peter Turchin Department of Ecology and Evolutionary Biology, University of Connecticut
- Link to report @ nature.com

--

What about the Kondratiev wave? Long-wave theory is not readiy accepted by econmists for a few reasons, but let's ignore that and take a deeper look at the theory.  The Kondratiev wave theory (named for Nikolai Kondratiev) has three phases in the cycle: expansion, stagnation and recession along with a turning point. Kondratiev proposed this in his 1925 book The Major Economic Cycles (1925).

Proposal:
1790–1849, with a turning point in 1815.
1850–1896, with a turning point in 1873.
Kondratiev supposed that in 1896 a new cycle had started.

The long cycle supposedly affects all sectors of an economy. Below, a "rough schematic drawing showing growth cycles in the world economy over time according to the Kondratiev theory." 






CC license: image license info


Copyright 2010 - 2020

Zermatt Media Investments Ltd.