Kondratiev Long-wave Theory

A long time ago in the early and middle decades of the 20th century, Nikolai Kondratiev and Joseph Schumpeter wrote about “long waves.” However, they didn’t know the reason for the periodic boom/bust cycles.

The reason for these periodic depressionary times is that scientific revolutions happen about every 80 years (73-87 years since 1506).

Watch the above animation. See how crisis periods in physics are followed within about 45 to 70 years by industrial revolutions in the 1700s and afterwards. The industrial revolutions produced 80 year waves of productivity growth, but the productivity growth cycle in turn caused times of severe economic depression following what is called the onset of “technological acceleration” in the technological paradigm such as started in 1820 in Britain and 1830 in the US, 1929, and 2008. Less severe depressions happened in the 1790s, the 1890s, and the 1970s and early 1980s during the industrial revolutions.

The “technological acceleration” times are marked in green. The dotted line shows labor productivity growth rates in the US. The depression periods happen about ten years after the doubling of productivity growth happens during the period of productivity growth acceleration and during the industrial revolution junctures. This is what caused the 40-60 year timing between depression and deep recession eras in the US and the world since 1790. As explained in my other articles and the book (1991), the quick acceptance and development of the fluid paradigm is what caused the time between depressionary periods to be 50 years in the 19th century and not the 40 years usual now. Expect further increases in productivity as the effects of robotic and automatic production, automation of services, and oligopoly tactics cause further increase in human labor unemployment in the most advanced economies this decade.