WP: "Great surges of development and alternative forms of globalization"


2007. “Great surges of development and alternative forms of globalization” TOC/TUT WP No. 15 Working Papers in Technology Governance and Economic Dynamics, The Other Canon Foundation, Norway and Tallinn University of Technology, Estonia.

Link: http://hum.ttu.ee/wp/paper15.pdf (268kb)
 
2009 Published in Spanish: "La Otra Globalización Los Retos del Colapso Financiero", Problemas del Desarrollo: Revista Latinoamericana de Economía Vol. 40, No. 157, pp. 11-37 (México) April

Download: CPLaOtraGlobalizacion.pdf (2.05mb)
 

Table of Contents:


1. In Great Surges in economic development: Recurrence and uniqueness
2. The ruthless role of the major technology bubbles
3. The legacy of the bubble: three tensions at the Turning Point
4. The need for institutional recomposition to favor production over finance
5. Why globalization?
6. Some thoughts on the possibility of a positive-sum globalization
7. The Institutional Challenge
 

List of Tables and Figures:


Table 1 The five great surges of development: Technological Revolutions and Techno-economic paradigms
Figure 1 The double nature of technological revolutions
Table 2 A different techno-economic paradigm for each great surge of development
Figure 2 The life cycle of a technological revolution
Figure 3 The social assimilation of technological revolutions breaks each great surge of development in half
Figure 4 Parallel surges with major bubbles, Golden Ages and approximate dates of Turning Points
Figure 5 Income polarization as one of the negative legacies of the Installation Period   
 

Introduction:

The present understanding of globalization is inextricably tied to the free market ideology for both proponents and opponents. This paper will argue that globalization has many potential forms of which the neo-liberal recipe, applied up to now, is only one.

The need to recognize the whole planet as the economic space is an inherent feature of the present technological revolution and its techno-economic paradigm. However, just as national State intervention in the economy took several different forms in the previous mass production (or "Fordist") paradigm, so globalization can be socially and politically shaped in order to favor truly global development and support the full deployment of the current flexible production (or Information technology) paradigm.

Simply put: globalization need not be neo-liberal. A pro-development version of globalization has not yet been designed or defended as such (1). It will be argued that, without it, not only would it be very difficult to relaunch development in the South but also to overcome the present instabilities, imbalances and recessionary trends in the economies of the North.

These propositions stem from an historically-based model of the way in which successive technological revolutions are assimilated in the economic and social system, generating great surges of development that follow a recurring sequence and involve major readjustments in both the economic and the socio-institutional spheres (2).

In terms of this model, the present period, after the collapse of the major technology bubble, would be at the mid-point of the current great surge, right when the structural tensions that underlie the ensuing instability and recessionary trends require a fundamental institutional recomposition. Among other tasks, income needs to be re-channeled towards new layers of consumers in order to help overcome the premature market saturation that results from the polarization of income in the top band of the spectrum in each country and in the world. This paper will argue that the present is, for that reason, the most appropriate time to put forth bold proposals for a profound redesign of global regulation and institutions.

The argument is developed beginning with a general summary of the model, in section 1. Then, Section 2 focuses on the recurrence of great financial bubbles, a decade or two after the irruption of each technological revolution, and examines their role in facilitating paradigm shifts and in concentrating investment in the installation of the new infrastructures. Section 3 analyzes the post-bubble recessions and the structural distortions inherited from the "casino" economy, while Section 4 discusses the need to overcome those tensions by means of appropriate regulation and institutional changes. Section 5 analyzes the globalizing nature of the Information Technology paradigm followed in section 6 by a discussion of the features of that paradigm that could lead to a positive-sum game between North and South. Finally, section 7 looks at the institutional challenges involved in such a post-neo-liberal form of globalization taking into account some of the present world trends and their possible outcomes.

1 Though it could be held that the European Union has some important features of such a version Up

2 This paper is largely based on Perez (2002) [Spanish edition 2004]

Publications
 

"TECHNOLOGICAL REVOLUTIONS AND FINANCIAL CAPITAL:The Dynamics of Bubbles and Golden Ages"

Published 2002

'...the book fills an important gap in the literature on business cycles and innovations. I most strongly commend it to all those attempting to understand the past and future evolution of technology and the economy.'

Christopher Freeman, Emeritus Professor, SPRU,
University of Sussex, UK

'...Carlota Perez shows us that historically technological revolutions arrive with remarkable regularity, and that economies react to them in predictable phases. Her argument provides much needed perspective not just on history, but on our own times. And especially on our own information revolution.'

W. Brian Arthur, Santa Fe Institute, New Mexico

‘For contents page, selected extracts and further details, click here’.

Technological Revolutions Financial bubbles Installation Period Frenzy Deployment Period Golden Ages Dual strategy Techno‑economic paradigms Neo‑Schumpeterian Respecialization Synergy Turning Point Future markets Knowledge society Green growth Maturity Full global development Globalization Sustainability Socio‑economic development Paradigm shifts Irruption Market hyper‑segmentation