Events

Tomorrow's Capitalism: Growth after the financial crisis

Email this to a friend Print Delicious Digg Facebook Reddit

01 June 2009

With Carlota Perez, Research Associate, CFAP/CERF, Judge Business School, Cambridge University, UK Professor of Technology and Development, Technological University of Tallinn, Estonia, Honorary Research Fellow, SPRU, University of Sussex, UK.

Download the recording: Carlota Perez (.mp3)

(To download, right-click the above link and select 'Save Target As...')

The financial crisis and deep global recession not only caught many by surprise, but also leaves most of us very uncertain about the future. Numerous analyses of what went wrong with the governance of finance over the last 25 years are now appearing, but few if any give a convincing account of what happens next. Perhaps uniquely amongst analysts of capitalism, Carolta Perez offers a framework that not only places the current financial meltdown in an historical perspective going back 300 years, but also holds out the possibility that we may actually about to enter a new ‘golden age’ of equitable and productive growth.

Perez’s path-breaking book Technological Revolutions and Financial Capital: the Dynamics of Bubbles and Golden Ages (2002) builds on the tradition of Schumpeter. Perez describes the ways in which successive surges of new technologies have transformed not only the economy but also its social institutions, and the crucial role of financial capital in those surges. Each surge has historically followed a pattern of technology emergence and explosive growth, leading to a period of financial frenzy, crisis and then a more steady period of deployment. The Wall Street Crash, Great Depression and post-war Golden Age can all be seen as part of the great surge associated with the age of oil, automobiles and mass production.

The current surge, dating from the early 1970s and based on ICTs and the Internet, has now hit the crisis stage. How easily and quickly we can move on to a phase of more sustainable deployment and growth depends crucially on reforms in finance as well as in wider institutions and policies, including those needed for a more environmentally sustainable growth.

'As regards the relationship between technology, the economy and society, Carlota Perez is one of the world's most innovative researchers. In this book she presents a systematic analysis of those interactions, empirically grounded and theoretically coherent, centered on the dynamics of financial capital, as the strategic instrument of globalization. It is a fundamental work to understand the structural transformations of the economy and society in the information age.'
-Manuel Castells, University of California-Berkeley and Universitat Oberta of Catalunya

'The dynamics of capitalism are driven by the intersection of the development and deployment of transformational technologies and the behavior of financial institutions and markets, yet for both historians and theoreticians these two domains have been virtually walled off from each other since Schumpeter. Now Carlota Perez has defined a frame of reference for analyzing the recurring cycles of boom and bust that characterize the past 250 years of economic development, one that calls to mind the synthetic vision of Fernand Braudel's great work on Capitalism and Civilization. In doing so, Carlota Perez has also provided a road map to relevance both for scholars and investors who, having survived the Great Bubble of 1999-2000, must needs concern themselves with what happens next.'
-William Janeway, Vice Chairman, Warburg Pincus, US Founder CERF, Cambridge [University] Endowment for Research in Finance, UK

'It was Carlota Perez in the early 1980s, who designated the major changes in technology systems, such as mechanization, electrification or computerization, as "changes of techno-economic paradigm" a designation which has since been widely adopted. In this book she offers many new insights into these complex processes of social, economic and technological change. She traces the interactions between that part of the economy commonly known as "financial capital" and the evolution of technologies. Although this was an important aspect of Schumpeter’s original work, it has been neglected by his followers, so that 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.’
- From the preface by Christopher Freeman, Emeritus Professor of Science Policy, SPRU - Science and Technology Policy Research, University of Sussex, UK and MERIT, Maastricht University, The Netherlands

‘Before I read this book I thought that the history of technology was – to borrow Churchill’s phrase – merely “one damned thing after another”. Not so. 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, Citibank Professor, Santa Fe Institute, New Mexico, US

Speakers

Carlota Perez is Research Associate, CFAP/CERF, Judge Business School, Cambridge University, UK, Professor of Technology and Development, Technological University of Tallinn, Estonia and an Honorary Research Fellow at the Science Policy Research Unit, University of Sussex, UK. As consultant and lecturer she has worked for various public and private organizations, for major corporations and governments in Latin America, North America and Europe as well as for the EU, the OECD, the UN and several multilateral agencies.

Technological Revolutions and Financial Capital: the Dynamics of Bubbles and Golden Ages (2002) was hailed at the time of its publication as “a great contribution to the understanding of the interaction between financial capital and technological progress.”