[PEN-L:4587] Re: The post-WW2 long wave (was: Kondratiev waves)

[dassbach@xxxxxxx (Carl H.A. Dassbach)]

>Carl Dassbach replies (to my posting):
>
>> Maybe, but this is NOT an explanation of the K-waves, as recurring periods
>> of expansion and contraction, evident in advanced economies since the late
>> 18th c. (and some would say 16th. c. see Dassbach, "Long Waves Prior to
>> 1790." REVIEW, Spring 1995, forthcoming).
>
>Let us then forget about earlier waves, and confine ourselves to the
>post-WW2 long cycle. Your thoughts on that, Carl?
>

Actually, my entire reply did not, for some reason, get reproduced but I
won't repeat it.  My point was the causality may be unknowable and
unimportant.  In my opinion, the heuristic function of  K-waves, namely,
that they add/impose a higher order coherence into our historical
narratives, may be their most important aspect

Still, having said that causality may not be important, Trond asks that I
speculate on the cause of the post-war long wave.

As far as I am concerned, the post war LW can be explained in terms of  the
clustering of innovations - understood is the Schumpterian sense and not in
the sense of Neo-Schumpterians such as Mensch or Kleinknecht. The latter
have an extremely narrow sense of the clustering of innovations, namely, as
the clustering of the commercialization of new inventions (which leads to an
empiricist  research program of tracking patents, etc)  For Schumpeter, on
the other hand, the concept of innovations is much broader and refers to all
types of `new combinations'.  Obviously, this includes the commercialization
of inventions ala Mensch and Kleinknecht but it also includes many important
innovations of the post-war period totally overlooked by the mecho(neo) -
Schumpterian such as the creation of  new markets (e.g, youth market) , new
business organizations (mass marketers) , or new financial instruments
(credit cards).    Without going into details, it is my opinion this cluster
of innovations (understood in the broadest sense) propelled post war
expansion (albeit at somewhat different rates and temporalities in core
countries) until the 1970s when the expansive potential of the innovations
ended due to both endogenous (exhaustion/saturation) and exogeneous (oil
shock) factors.

Let me also add, that the misrepresentation of his concept of innovations
(ala Mensch and company)  is not the only distortion  of Schumpeter's theory
of the long wave. In addition and perhaps more importantly (and I have
developed this in a paper currently under review). Kuznets' famous review of
Schumpeter's BUSINESS CYCLES introduced a far more enduring and
consequential misinterpretation of Schumpeter theory, i.e., it is unable to
explain why innovations cluster. I argue that Schumpeter does explain why
innovations cluster, it is just in terms which Kuznets' neither understands
or accepts.
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Carl H.A. Dassbach                                   E-mail:   DASSBACH@xxxxxxx
Dept. of Social Sciences                            Phone:   (906)487-2115
Michigan Technological University              Fax:       (906)487-2468
Houghton,  MI   49931    USA