erc/metu
INTERNATIONAL CONFERENCE IN ECONOMICS  IV
September 13-16, 2000, Ankara

What Makes a Phase-Change in Capital Accumulation? Theoretical Considerations and Empirical Evidence

Lefteris Tsoulfidis (University of Macedonia, Greece)

Abstract  

This paper deals with the long cycles that characterize the evolution of capitalist economies. It begins with a discussion of epochs of expansion and contraction in the level of economic activity in various countries and makes an effort for a meaningful periodization of economic history. The claim that this paper raises is that profitability regulates the phases of these long cycles. After a theoretical discussion on the mechanics of the long-term movement in profitability and the phases of long cycles the discussion is supported with data from OECD economies. The empirical evidence is consistent with the hypothesis that indeed the 1990s concentrate the characteristics for the onset of a new golden age of accumulation. The salient feature of this new epoch is the dominance of information technologies. Unlike, however, the popular view that regards the “new economy” as depressions free. The paper argues that in so far as the economy is on its expansion phase of the long cycle it is true that recessions are short lived and shallow and economic growth is strong. However, such a phase, as history repeatedly has shown, is succeeded by the downturn of the long cycles and the situation reverses: the recessions last longer and are deeper, while growth is anemic and the claims of “the new economy” are not expected to hold.

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