Crisis And Embodied Innovations (eBook)

Volodymyr Vsevolodovych Ryaboshlyk is a Ukrainian economist who has had time to conduct research, teaching, publicist and governmental activities. In the aftermath of the Orange Revolution he held the position of Deputy Minister of Economy of Ukraine. He received his PhD at the Department of Economic Cybernetics at the Plekhanov Institute of the National Economy, Moscow, Russia; and his MSc in Computer Aided Management Systems (CAM systems) at Kharkiv Polytechnic Institute, Ukraine. He also took the Program for Senior Ukrainian Economists at the Economics Institute in Boulder, Colorado, USA. His abnormal ideas about a normal crisis were reported at many centres from Tokyo to Paris.

Cover 1
Half-Title 2
Title 4
Copyright 5
Dedication 6
Contents 8
List of Figures 11
1 Introduction 15
Part I Crises and Cycles Driven by Embodied Innovations: Real Aspects 25
2 State of the Art Around the Innovations-Crisis Link 26
2.1 Leap-like progress 26
2.2 Explanation by David Ricardo: starting accumulation of new machines 27
2.3 Marx and “Marxists”: who has put the cart before the horse? 29
2.4 Convoluted explanations by Schumpeter 30
2.5 Real business cycle theory – right idea and wrong tractability 32
2.6 Whether total factor productivity reflects progress 34
2.7 Fluctuating trend vs fluctuations around trend 36
2.8 Constructive framework proposed 39
3 The Innovations-Related Cause of Crises Confirmed by the Prototype Economy 43
3.1 Global fisher folk of the twenty-first century 43
3.1.1 Statement of the problem 43
3.1.2 Overall slumping S-curve 45
3.1.3 Multiple paths to a single finish 52
3.2 Fisher folk economy vs Solow economy: golden path vs golden rate 55
4 The Innovations-Related Cause of Crises Confirmed by the Concrete Economy 64
4.1 Where are the data? (What are the technologies the gross capital formation forms?) 64
4.2 The simplest step forward 66
4.3 Heterogeneity matters: answering the question posed by Professor Pissarides 73
4.4 Physical retirement of capital vs financial depreciation 74
5 Empirical Support for the Presence of the Innovations-Related Cause in the Current Crisis (Non-financial Roots of the Financial Crisis) 77
Part II Real Cyclical Dynamics in Monetary Environment 82
6 Theoretical Basis to Embed the Real into the Financial: Production-Consumption Compromise vs Supply-Demand Paradigm 83
6.1 Heterogeneity vs diminishing returns 84
6.2 Objective marginalism: generalisation of Ricardo 88
6.3 Commodities produced vs commodities endowed from nowhere 91
6.4 Production possibility frontier in an economy without capital 91
6.5 Utility mountain (field of desires) 95
6.6 Fundamental production-consumption compromise 97
6.6.1 Quantities without prices 97
6.6.2 Achieving fundamental compromise in a non-market subsistence economy 100
6.6.3 Achieving fundamental compromise in a market economy 101
6.7 Production possibility frontier in an economy with capital 108
6.8 Wage-profit compromise 118
6.8.1 Not yield to formalisation 118
6.8.2 How Great Plague killed off supply-demand for labour 121
6.9 Burnt bridges to supply-demand paradigm 123
6.10 Connection with and evolution of welfare economics 130
6.11 To be constructive 136
7 Dynamics of Prices 139
7.1 Dynamics without inflation 139
7.2 Dynamics with inflation: non-Keynesian substantiation of the Keynesian easy money 146
8 From Interest Rate to Stocks 150
8.1 Interest rate for credit: savings and investment 150
8.2 Leverage or gearing: stock market 153
Part III Precursors and Competitors 159
9 Concept of Price: Aristotle vs Marshall 160
9.1 Tail wags the dog 160
9.2 “Time is price” supported by facts 165
9.3 Sales tax vs cumulative effect 168
10 Starting Accumulation vs Primitive Accumulation 171
11 Demando-Mania: Keynes and Demand-Deficient Versions of Crisis 177
12 Wage-Profit Distortions in Ireland and Ukraine 180
13 Bridges to the Cambridge Multisectoral Dynamic Model of the British Economy 183
14 Conclusion 187
References 190
Index 200