To date, economic science distinguishes several types of cycles. The most elementary of them are annual, which are associated with seasonal fluctuations under the influence of changes in natural and climatic conditions and the time factor.
Short-term cycles, the duration of which is estimated to be 40 months, i.e. a little more than 3 years, due to alleged fluctuations in world gold reserves. This conclusion was drawn in relation to the conditions of the domination of the gold standard.
Medium-term, or industrial cycles, as shown by more than 150 years of world practice, can have a duration of 7-12 years, although their classical type covers approximately a 10-year period. This type of cyclic development is a further object of our analysis. It is associated with a multifactorial model of disruption and restoration of economic balance, proportionality and balance. National economy.
Construction cycles cover a 15-20-year period and are determined by the duration of the renewal of fixed capital. In this regard, we can say that these cycles tend to decrease under the influence of scientific and technical progress factors that cause obsolescence of equipment and the policy of accelerated depreciation.
Large cycles have a duration of approximately 50-60 years; they are caused mainly by the dynamics of scientific and technical progress, which we will discuss in more detail below.
Let us consider more fully the so-called industrial cycles. In the cycle, the economy goes through certain phases (stages), each of which characterizes a specific state economic system. These are the phases of crisis, depression, revival and recovery. In Western economic literature, these states of the national economy have been adequately reflected in such concepts as recession, depression (lowest point), rise, peak of production (highest point). Graphical interpretation of the economic cycle is shown in fig. 30.1.
Rice. 30.1. The economic cycle and its phases
Let us dwell on a brief description of each of the above phases of the cycle.
A crisis is an internal mechanism for forcibly adjusting the size of social production to the volume of solvent demand of economic entities. This is a general overproduction, a profound shock to the entire economic system from top to bottom.
The demand for money capital is falling sharply, in contrast to the crisis phase, when many commodity producers experienced a real "hunger" for money resources. The "hurricane" of the crisis has already swept over the field economic activity, testing the stability of the enterprise. The problem of survival or bankruptcy has already been solved and there is a lull. As a result, there is an excess of money capital, the level of interest rates and the value of securities fall. The specifics of the movement of interest rates and cost valuable papers is that, despite the fall in interest rates, the price of securities does not rise. This is due to the stagnation of production, which does not ensure the receipt of dividends. At this phase, the division of actually functioning capital through the channels of movement of fictitious capital is completed by buying up controlling stakes in weaker competitors.
The revival is associated with the intensification of economic activity, a partial renewal of fixed capital, an increase in production volumes, an increase in the level of prices, profits and interest rates, and the adaptation of the economy to the newly formed price level. The duration of this phase of the cycle is predetermined by the achievement of the level of social production (GNP, GDP) corresponding to the pre-crisis state. In this phase, the unemployment rate decreases somewhat, the circulation of capital accelerates, the demand for credit increases, and interest rates rise. The prices and profits of enterprises begin to rise, the prices of shares and other securities rise, speculation in which is gaining significant proportions.
The rise is determined by the continuation economic growth started in the previous phase, reaching relatively full employment, expanding production capacity, their modernization, the creation of new enterprises. Interest rates continue to rise under the influence of increased investment. Despite the increase in the level of interest rates, there is also an increase in the price of securities, since it is positively affected by the growth in the profitability of enterprises. In addition, the high yield of securities provokes the growth of investments in fictitious capital.
A special role at the stage of recovery is played by merchant capital, which, seeking to purchase more goods in the expectation of a further increase in prices, forms a speculative boom in demand, which pushes production to further expand it. As a result, the gap between production and the effective demand of the population begins to grow.
Particular attention in the study of the cycle deserves a different reaction of industries and industries to release, on the one hand, the means of production, primarily the means of labor, on the other hand, consumer goods. This is due to the fact that the industries that produce means of production are characterized by a longer production cycle. Due to the rather long investment period and the gap between the initial and final stages of the production process, enterprises in such industries form a portfolio of orders in advance in order to ensure the sale of their products. Due to these objective circumstances, they react more slowly to changes in market conditions. At the first symptoms of a decline in production and the economy is creeping into the crisis phase of the industry for the production of means of production,
despite the clear symptoms of an unfavorable macroeconomic situation, they continue the investment and production process on the basis of previously formed portfolios of orders, which exacerbates the growing crisis situation.
The different nature of the investment and production processes in the sectors for the production of consumer goods and means of production also affects the exit of the economy from a depressed state. Industries that produce commodities tend to increase output, while industries for the production of capital goods are just starting to form portfolios of orders. This in a certain way hinders the more dynamic development of the national economy in the recovery phase.
Depending on the nature of economic downturns, their coverage various areas or sectors of the national economy, it is necessary to distinguish between the following types of economic crises: cyclical, intermediate, structural, partial, sectoral.
Cyclic crises are periodically repeated declines in social production, causing paralysis of business and labor activity (activity) in all spheres of the national economy and giving rise to a new cycle of economic activity.
Intermediate crises are sporadically occurring downturns in social production, which temporarily interrupt the stages of recovery and recovery of the national economy. Unlike cyclical crises, they do not give rise to a new cycle, they are local in nature and short-lived.
Structural crises are associated with a gradual and prolonged increase in intersectoral disproportions in social production and are characterized by a discrepancy between the existing structure of social production and the changed conditions for the efficient use of resources. They cause long-term shocks and require for their resolution a relatively long period of adaptation to the changed conditions of the process of social reproduction.
A striking example of a global structural crisis is the energy crisis that developed in the mid-70s, which took more than 5 years to adapt. national economies industrialized countries to a new structure of energy prices (price jump exceeded 4-5-fold increase). As a result, both technologically, financially and economically, national economies were forced to orient and adapt industries and industries to energy-saving technologies and changes in the structure of consumed energy carriers.
Partial crises are associated with a drop in economic activity within large areas of activity. In particular, we are talking about money circulation and loans, banking system, stock and currency markets. The world currency crisis of the 1970s, as is known, led to the transition from the Bretton Woods monetary system to the Jamaican (Kingston) agreement of 1976, according to which gold ceased to play the role of world money and became one of the commodities. Well known and biggest crisis banking system Germany 1932
Sectoral crises are characterized by declines in production and curtailment of economic activity in one of the branches of industry, the national economy. The history of such crises is most fully traced in the coal, steel, textile, and shipbuilding industries.
Seasonal crises are caused by the impact of natural and climatic factors that disrupt the accepted rhythm of economic activity. In particular, a delay in the onset of spring could cause a crisis in public utilities due to lack of fuel.
World crises are determined by the coverage of both individual industries and areas of economic activity on a global scale, and the entire world economy.
Moreover, the most profitable enterprises were privatized, many of which soon joined the ranks of unprofitable ones.
Let us briefly name the most important causes of the economic crisis:
It should be noted that not a single country in the West, in the transition from the neo-Keynesian to the neo-conservative model of development, has resorted to such radical measures both in terms of timing and scale, as happened in a country dominated by a centralized economic system. At the same time, not the development of the economy, the solution of social problems, the improvement of the well-being of the nation, but the fight against inflation, financial stabilization, the formation of the banking system, the stock market, i.e. what was a means was presented as the goal of reform. Hence the results. At the same time, the decisive role was played by the ideological attitude - "to prevent a return to the past." The price of this installation is the collapse of the economy, the degradation of society.
Within the framework of large cycles, the way out of this situation is associated with structural shifts in the national economy, accompanied by a modification economic mechanism. This leads to the intensification of innovative activity, the use of new technologies in traditional industries and industries, the withering away of those that have retained an outdated technical basis, as well as the improvement of forms and methods of organizing and managing production at the level of both individual enterprises and their associations, and industries and national economic complexes.
Technological shifts cause the market to be filled with many innovations that cover literally all elements of economic relations and their interaction. As a result, a more capacious market is gradually being formed, first for production factors, and then for the entire spectrum of products and services that meet new requirements. The more effective new technologies are, the more widely they are distributed in production, and the more capacious the market for final products and the stronger the impulse given by innovations to the entire economy, the more successful the process of accumulating real capital, the higher the level of its efficiency or productivity. This is the result of the stage of development, which in general ensures the growth of the economy and its well-being for decades. With such a logic of development, embodied in long waves, the whole process of cyclic dynamics is linked.
In conclusion, let's pay attention to the fact that long waves exist (statistically proven), but in theoretical terms there are more postulates than evidence for this. N.D. Kondratiev associated large cycles with the movement of basic capital goods, the change of which is allegedly carried out by shocks. But the question of smoothness or spasmodicity remains open, because the cause of the “shocks” is unclear.
conclusions
1. Economic development is characterized by cyclicity, which is characterized by the recurrence of declines and rises in production. Medium-term, or industrial cycles cover a period of 7 to 12 years. The industrial cycle includes phases of crisis, depression, recovery and recovery. The crisis is characterized by the curtailment of economic activity in the entire economy or the vast majority of it, as well as the overproduction of capital in one form or another. Depression is characterized by the stagnation of economic activity. The revival is characterized by some activation of this activity, accompanied by a gradual "resorption" of commodity stocks and resources. The recovery stage continues until the economy reaches the level of production corresponding to the pre-crisis period. Then an economic recovery begins, accompanied by an increase in demand for both goods and services and resources.
2. There are the following types of economic crises: cyclical, intermediate, structural, partial, sectoral. The cyclical crisis expresses repeated recessions in social production. The intermediate crisis occurs within the industrial cycle and temporarily interrupts either the recovery phase or the recovery phase. A structural crisis is characterized by a discrepancy between the existing structure of social production and the changed conditions for the efficient use of resources. A partial crisis covers certain areas of economic activity (for example, the financial crisis, the crisis of the banking system). Sectoral crises are characterized by a decline in production in one of the branches of industry, the national economy. A special place is occupied by global crises, covering both individual industries and areas of economic activity on a global scale, and all world economy.
3. Each stage of the historical development of the market-capitalist economy is characterized by certain features of both the course of the economic cycles themselves and economic crises. It can be sluggish rises and sharp, deep declines, and, conversely, sluggish current recessions and intense, long rises. Likewise, crises can be characterized by overproduction of either commodity or productive capital (production capacity).
4. The cyclical nature of the development of a market economy objectively necessitates its counter-cyclical regulation, which involves the use of a whole system of ways and methods of influencing the economic situation, activating or deactivating economic activity. Countercyclical regulation includes means of both direct and indirect direct impact on the economy.
Federal State Educational Budgetary Institution
higher professional education
Financial University under the Government of the Russian Federation
(Financial University)
Course work
Topic: Cyclicity economic development. Causes of cyclicality in the economy
Discipline: Economic theory
Completed:
ISP student (group 8FM):
Belomestnykh R.S.
Checked:
Professor Lanin B.E.
Moscow 2010
Plan
Introduction
1. The cycle of economic development
1.1 General idea of cyclicity. Business cycle
1.2 Main phases of the economic cycle
1.3 Types of cycles
2. Causes and forms of cyclicity
2.1 Economic theories of the causes of cyclicity
2.2 Features of the modern crisis in the light of the theory of cycles
2.3 Counter-cyclical policy of the state
3. The global crisis and its impact on Russia
3.1 Consequences of the global crisis for the Russian economy
3.2 Counter-cyclical policy of the Russian Federation
Conclusion
List of used literature
Introduction
Modern society strives for constant improvement in the level and conditions of life, which can only be ensured by sustainable economic growth. However, long-term economic growth is not uniform, but is constantly interrupted by periods economic instability. The economic history of the last two centuries provides us with a great many examples of the instability of the market economy. Periods of successful industrial development and general economic prosperity have always been followed by periods of recession, accompanied by a fall in output and unemployment. In general, the market economy tends to repeat itself. economic phenomena, which makes it possible to reveal the "cyclical" nature of its development. But in nature, too, everything is arranged in the form of cycles: the onset of day and night, summer and winter, etc.
Since the economic crises of the first half of the 19th century, economic scientists have been trying to find the causes and explain why this happens at regular intervals with stubborn persistence. The problem was of such great importance that practically no economist of the 19th and 20th centuries avoided it. The problem of cyclical development is discussed in the works of Spitthof, Tugan-Baranovsky, Marx, Veblen, Mitchell, Hicks, Keynes, Schumpeter, Kondratiev, etc. There is no consensus in these works and many interpretations can be found in them, explaining the causes, phases and characteristics of cycles, various explanations and forecasts. Therefore, the issue of cyclical fluctuations is still relevant, the current crisis period adds sharpness with a lot of new information and the ability to compare data, all this determines the topic of this study.
The purpose of the course work is to reveal and study the essence of economic cycles and their role in economic development.
This goal defined the following tasks:
1. explore the work of economists on this issue;
2. reveal the essence of the economic cycle;
3. consider the main phases of the cycle;
4. study the main approaches to the classification of cycles;
5. analyze the possibility of countercyclical regulation;
6. explore the role of cyclical development in the Russian economy during the economic crisis;
7. analyze the material and make a forecast for the XXI century.
The object of research is the cyclical nature of economic development. The subject of the research is the economic cycle and its phases.
The research method is a comparative analysis of various approaches, and points of view, explaining the cyclical nature of economic development.
Textbooks, monographs and lectures on economic theory and periodicals Internet sites served as the source material for the study.
The structure of the work is built in accordance with the purpose, objectives and logic of the study; consists of introduction, 3 chapters, conclusion and bibliography.
In the introduction, the relevance of the topic is substantiated, goals and objectives are formulated, and the object of study is defined. In the first chapter "Cyclicity of development of economic systems" the concepts of cyclicality, cycle and its phases, types of cycles are revealed. In the second chapter "Causes of cyclicity" the causes of cyclical fluctuations in market economy, goals and instruments of the countercyclical policy of the state; the third chapter "The global crisis and its impact on Russia" is devoted to the current global crisis and its consequences for the Russian economy.
In conclusion, the main conclusions on the study of cyclicity and its causes are formulated.
1. Cyclical development of the economy
1.1 General idea of cyclicity. Business cycle
In the movement of social production, there are years when the growth of the total volume of production is very fast, in other years it is slower, and there is a periodic decline. In an effort to expand production, to conquer a larger market, business owners periodically face overproduction. Trying to identify the causes of overproduction, economists have paid attention to the periodicity of such phenomena as an increase or decrease in demand, an increase in production volumes or its stagnation. A certain sequence in the alternation of these phenomena was also revealed. The real economy is characterized by underemployment, fluctuations in prices, interest rates, profit rates in various industries, which leads to periodic ups and downs in the gross national product (GNP). Thus, it is easy to detect a large group of economic parameters that oscillate over medium and short time periods. intervals. This means that the economy, under the influence of many factors, develops in waves, or cyclically. Cyclicity reflects the uneven flow of economic processes, i.e., the progressive development of the economy, can occur not only through constant or uneven growth, but also oscillatoryly, and the latter path is absolutely predominant.
Rice. 1 Varieties of economic growth
R-constant rate of economic growth;
R1 - decelerating growth rate;
R2 - accelerating growth rate;
R3-oscillatory growth rate;
GNP - gross national income.
With this approach, macroeconomic development appears as a "cyclical movement", i.e. as a transition from one cycle to another. Macroeconomic statistics steadily confirms the cyclicality hypothesis, finding periodicity in fluctuations in growth rates (waves of economic dynamics), investment activity, in the agricultural sector, construction, etc. These fluctuations intersect, overlap each other, which makes the problem of isolating individual cycles really difficult to solve. Fluctuations in the dynamics of economic growth are not random, spontaneous, but, in fact, are an expression of the movement of the economy from one stable state to another, i.e. manifestation of the mechanism of self-regulation of the market, as well as a way to change its sectoral structure. This is a characteristic feature of cyclicity - movement in a spiral (and not in a circle). Consequently, cyclicality is a form of progressive development. Only a cyclically developing economy is efficient. On the contrary, economic systems in which cyclicality is suppressed (for example, by hypertrophy government intervention into the economy), are doomed at best to extensive growth. To measure the strength of a wave-like movement in a market economy, a special “unit” of economic fluctuation is used - "economic cycle".
Rice. 2 Graphical interpretation of the business cycle
Economic cycles (waves) are constant, periodically recurring in time, ups (ups) and downs (downs) of market conditions, economic activity, differing from each other in duration and intensity in the presence of a long-term trend towards economic growth. The cycle covers the period of movement of the economy from one rise (recession) to another. One cycle can take several years, differing from others in duration and intensity (sometimes there are even no separate phases). During the cycle, there is an increase in the production of goods and services, and then a decrease, a decline, and, finally, its growth again. At the top of the cycle, economic activity is well above the long-term growth trend, while at the bottom of the cycle, economic activity is at its lowest point.
Rice. 3 Economic cycles (waves) are periodic fluctuations in business activity in society.
Economic cycles cover almost all areas of the national economy and have a variety of distinctive features.
Rice. 4 Business cycles
With the inevitable features of each completed cycle, they have something in common - a sequence of identical phases within each cycle.
1.2 The main phases of the economic cycle
In modern economic literature, there are two approaches to the study of business cycles. In the first economic cycle is divided into two phases: recession and recovery. A recession refers to a crisis and a depression, while an upturn refers to a revival and a boom.
The recession phase, or recession, which lasts from peak to bottom. A particularly long and deep recession is called a depression;
The phase of recovery, or recovery, which continues from the bottom to the peak.
Rice. 5.1 two-phase model: 1 - phase of decline (compression); 2 - phase of rise (expansion);
There is another approach in which four phases are distinguished in the economic cycle: crisis (recession, recession), depression (stagnation), recovery and recovery (boom, peak).
Rice. 5.2 four-phase model: 1 - crisis phase; 2 - phase of depression; 3 - phase of revivals; 4 - lifting phase.
The main property of the cycle is fluctuations in GDP growth rates over time, when the economic system goes through four successive phases. In the classical cycle, the initial and determining phase is the crisis. It is the most important prerequisite for the progressive development of the economy through the renewal of fixed capital, reducing production costs, improving the quality and competitiveness of products.
Crisis phase. The main manifestation of the crisis is the decline in production volumes and the reduction in GNP. Accordingly, enterprises are not fully loaded, profits are reduced, stock prices are falling, employment is declining, the level of wages living standards are falling and poverty is on the rise. As a result, aggregate demand decreases, in response to this, production and, accordingly, supply are further reduced. In general, this phase is characterized by an excess of aggregate supply of aggregate demand. There is an imbalance in money market. The money supply lags behind the commodity supply, there is a shortage of money, especially in the initial stages of the crisis. Therefore, the only thing that can grow during a crisis is the norm. bank interest because the demand for money exceeds their supply. A high rate of interest with low profitability, and often unprofitable enterprises, leads to low investment activity. In time, the crisis can last from several months to several years, as was the case during the Great Crisis of 1929-1933.
phase of depression. This phase is characterized by the suspension of the decline in production; decrease in stocks of goods in warehouses; low business activity; an increase in the mass of free money capital. The level of production at this stage of the cycle remains stable, but in comparison with the pre-crisis level it remains very low - there is no growth; the fall in prices is suspended; unemployment continues to be high. The phase of depression can have a very long period. It can last from several months to several years. For example, it started in 1933. after the Great Crisis, the depression lasted until 1938, almost until the war itself.
Recovery phase. Characterized by economic recovery, there is some GDP growth, the demand for labor, for loan capital, for new industrial equipment is increasing. Unemployment is falling; prices begin to rise; demand increases in the commodity market. Most importantly, activate investment activities enterprises. Usually this phase does not last long, it quickly passes into the next phase.
Rise phase. This phase is also called the boom, as it is characterized by fairly rapid economic growth. At this phase, output exceeds the pre-crisis level. New technology serves as the material basis for the renewal of production; as a result, it enters a new, more high level development. There is an increase in employment, in some industries there is a shortage of labor. Wages, aggregate demand, sales, profits and stock prices of enterprises rise. The rate of interest no longer rises, and sometimes even falls. In a word, during the rise everything speaks of economic well-being and even prosperity.
In the context of the rise, the prerequisites are gradually building up (growth of commodity stocks, tension bank balance sheets) subsequent decline in production.
At present, the nature of the modern cycle is influenced by a complex of factors that lead to a change in its quality characteristics. These factors include:
1. monopolistic structure of markets;
2. state regulation economy;
3. scientific and technological progress;
4. the process of globalization (internationalization) of production .
1.3 Types of cycles
Economic fluctuations are deviations from a stable state of the most important parameters of the economy - production volume, price levels, employment, profit rates, etc. The most characteristic feature of economic cycles is their duration.. In modern economics about 1400 different types of cyclicity have been developed with a duration of action from 1–2 days to 1000 years.
J. Schumpeter put forward the idea of studying cycles in the form of a three-cycle scheme of oscillatory processes in the economy, which has become widespread in modern conditions. He named these cycles after the scientists who discovered them: J. Kitchin, K. Zhuglar, N. D. Kondratiev. Macroeconomic fluctuations in terms of scale and time are divided into short-term, medium-term and long-term cycles.
Short cycles, lasting about 4 years, are associated with the movement of inventory. When the size of real investment in fixed capital increases, the accumulation of commodity stocks often outstrips the need for them: their supply outstrips demand. In this case, the demand for them falls, a state of recession occurs (from the Latin. Recessus - retreat), in which there is a slowdown in production growth or even a decline. Thus, short cycles are associated with the restoration of equilibrium in the consumer and investment markets. In the economic literature, they are called "Kitchin cycles" after the English economist and statistician Joseph Kitchin (1861-1932).
Medium-term cycles are usually associated with the name of the French physicist and economist Clement Jouglard (1819-1908).
K. Zhuglar's cycles are medium-term (industrial, business, business) economic cycles lasting about 10 years. It is during this period of time that the fixed capital functions in production on average. The replacement of depreciated fixed capital in the economy goes on continuously, but not evenly, as it is under the decisive influence of scientific and technological progress. This process is combined with the flow of investment, which in turn depends on inflation and employment.
It is impossible not to say about the contribution of K. Marx to the development of the theory of cyclicity. He studied the average cycles, which are often called industrial (8 - 12 years), called periodic cycles or crises of overproduction.
In the second half of the XX century. average cycles have undergone significant changes: the processes of overproduction began to be accompanied by rising prices and inflation. The reasons for these phenomena lie in monopolistic pricing and in excessive government spending, which involves additional emission of money.
Long cycles, or long waves, the regularity of which was substantiated by the Russian economist Nikolai Dmitrievich Kondratiev (1892-1938). He considered the cause of long cycles to be radical changes in the technological base of social production, its restructuring. Kondratiev made analytical comparisons of the series economic indicators characterizing the dynamics of the world capitalist economy. Summarizing the huge statistical material, Kondratiev proved that along with the well-known small cycles of capitalist reproduction lasting 8-10 years, there are large reproduction cycles - 48-55 years. In them, Kondratiev singled out two phases, or two waves - upward and downward. These cycles, their internal self-movement and development, the transition from a downward wave to an upward one, were based on the mechanism of accumulation, accumulation, concentration, dispersion and depreciation of capital as a key factor in the development of the capitalist (market) economy. “Each subsequent phase of the cycle is a consequence of cumulatively accumulating conditions during the previous time, and each new cycle, while maintaining the principles of the capitalist organization of the economy, follows another just as naturally as one phase of one and the same cycle after another. But at the same time, it must be remembered that each new cycle takes place in new concrete historical conditions, at a new level of development. productive forces and therefore is not at all a simple repetition of the previous cycle. ”Kondratiev showed that before the upward phase, a kind of explosion of scientific and technological progress occurs, then at the stage of economic recovery, the “products” of this explosion are widely introduced into the economy.
One should also pay attention to the construction cycles, which are often called "cycles of S. Kuznets" (for the description of which Simon Kuznets received the Nobel Prize in 1971). The American economist and statistician Simon Kuznets (1901-1985) came to the conclusion that indicators of national income, consumer spending, foreign exchange investment in equipment, buildings, etc. carry out interrelated twenty-year fluctuations. The main reason for these fluctuations is the renewal of dwellings and certain types of industrial buildings.
According to the duration of the flow, the following types of economic cycles are distinguished:
Table 1. Types of economic cycles by duration
2. Causes and forms of cyclicity
2.1 Economic theories of the causes of cyclicity
"Each of the competing theories contains some elements of truth, but none of them is universal, fair for all times and countries."
(P. Samuelson.)
Cyclicity in general, as well as the economic crisis, is a kind of progressive development of the economy and, in general, its renewal. The phenomenon of cyclicality is recognized as multidimensional and a number of its forms are of a global nature. A variety of fluctuations are observed in the economy, which are of an objective nature. They differ in duration, the nature of manifestation and the reasons that give rise to them. There are many theories of economic cycles. For example, some scholars have linked phase rotation to how inventory is updated and changed in warehouses. Periodically, due to changes in demand, these stocks begin to increase, and then the volume of purchases of new goods decreases. This continues until stocks run low and a need arises for new goods.
Other economists associate cyclicity with the emergence of fundamentally new products that change the structure of demand and give rise to problems with the sale of obsolete goods and the need for a significant restructuring of the production sector (digital technology). Still others believe that cycles are generated by fundamental changes in the technological basis of production. Factors affecting the cyclical development of the economic system can be combined into two groups:
exogenous (external)-external theories
endogenous (internal) factors - internal theories.
external theories explain the cycle by the influence of external factors: wars, important political events, discoveries of new deposits, demographic situation, scientific and technical discoveries, bursts of solar activity.
internal theories pay attention to the mechanism within the economic system itself, especially in the sphere of monetary circulation and the influence of other internal factors (fluctuations in demand, supply, investment, consumption, production growth rates, employment, etc.).
Recently, the most popular theory based on the synthesis of objective and subjective factors. Its authors believe that external factors give the initial impetus to the cycle, while internal ones lead to phase-to-phase oscillations.
The economic theories of cycles arose as a reaction to the precarious position of the capitalist economy, the development of which was periodically disrupted by crises. Until the 1930s the dominant position in economic theory was occupied by the neoclassical direction, whose representatives considered crises as a random temporary phenomenon. They believed that the capitalist economy in conditions of free market competition automatically adapts to any disturbances in supply and demand and ensures the economic balance of the entire economic system. Under these conditions, the first theories of cycles arose as exogenous concepts, explaining cyclic fluctuations by the influence of external factors.
Theories of external factors. Their prominent representative is the English economist William Jevons, who linked economic cycles with the intensity of sunspots. According to this concept, the cycle of solar activity causes fluctuations in crop yields, which give rise to cycles. The thought of A.L. Chizhevsky worked in the same direction.
Theory of industrial cycles was proposed by K. Marx. Economic crises appear in the form of periodically recurring overproduction of goods, which leads to a violation of the conditions of reproduction, mass bankruptcies, an increase in unemployment and a decrease in production volumes. The main reason for the cyclic nature of production is the main contradiction of capitalism - between the social nature of production and the private form of appropriation. The basis of the periodicity of crises is the massive renewal of fixed capital, which occurs approximately every 10 years.
Psychological theory- in the factors of pessimism and optimism in the propensity to consume or save.
Theory of overaccumulation of capital. The foundations of the theory were laid by the economists M. I. Tugan‑Baranovsky and G. Kassel. They believed that the emergence of economic cycles is associated with the peculiarities of the accumulation of fixed capital. They brought out a specific feature: industries that create industrial goods develop at a higher rate under the influence of the economic cycle than industries that produce consumer goods. This specific interaction was studied by A. Aftalyon, who found that small changes in consumer demand can cause significant fluctuations in net investment. This phenomenon is called the principle of acceleration, which is integral part overaccumulation theory. Crisis phenomena arise as a result of the formation of disproportions in the structure of production, i.e., the overaccumulation of fixed capital.
Monetary Theory. At the end of the XIX-beginning of the XX century. The English economist R. Hawtrey and the American economist I. Fisher proposed a monetary cycle concept, according to which crises arise as a result of disturbances in the field of money supply and demand. Hawtrey considered changing the interest rate and the size of the loan as the main tool for managing the investment process, stabilizing the economic cycle and achieving economic growth. Fisher reduced economic crises to market fluctuations, which, in his opinion, can be eliminated by changing the purchasing power of money, regulating their quantity in circulation. A number of methods developed by Fischer are widely used in modern economics.
Keynesian theory of the cycle. J. Keynes considered cycles as the result of the interaction between the movement of national income, consumption and capital accumulation. The cycle begins to form during a period of rising demand, which, in turn, is determined by consumption and investment.
Theory of innovation. The cyclic nature is justified by the use of innovations in production. J. Schumpeter believed that the cyclical process is due to the spasmodic nature of the implementation of technical inventions and innovations.
The theory of underconsumption. The founder of the theory of underconsumption is the Swiss economist J. Sismondi, who considered crises as general overproduction, but substantiated the causes of crises by underconsumption of workers. Later, this theory was supported by the German economist K. Rodbertus-Jagetsov.
Monetary cycle theory. The American economist M. Friedman believes that the main role is played by the instability of monetary circulation. In his opinion, the economic cycle is the result of changes in cash flow. If the demand for goods, expressed in money, i.e. cash flow, increases, production expands, trade becomes brisk. If demand decreases, production decreases, trade weakens, and economic activity falls.
Currently, there is no single theory of the cycle. Economists
focus on the various causes of business cycles.
2.2 Features of the modern crisis in the light of the theory of cycles
After World War II, significant changes took place in the mechanism of cyclic fluctuations in conjuncture. During the period of post-war relative isolation of national economies, when the victorious states broke economic ties with the defeated states for some time, a certain asynchrony of cycles manifested itself in the world. While some countries, whose economy was little affected by the war, were naturally drawn into a crisis phase, others - in need of restoring their destroyed economy - entered a period of many years of economic recovery. This asynchrony allowed large private firms to maneuver their productive resources between countries for two decades, which helped to smooth out cyclical ups and downs in the world economy - and the subsequent restoration of cyclical synchronism. Currently, this synchronization is relative. So, in January 2005 in various countries European Union inflation rates vary markedly: from 6.7% in Latvia, 4.2% in Greece and Estonia, to minus 0.2% in Finland.
The financial and economic crisis that began in the United States at the end of 2008 has assumed a global character. Its socio-economic consequences: a drop in production, an increase in unemployment, a decrease in real income population. The current financial crisis can rightfully be considered the deepest and most dramatic in the last few decades of the development of the world economy. The main global cause of the crisis is the peculiarities of the cyclical development of the world economy. Most economically developed countries, primarily the United States and countries Western Europe, after the peak of technological and economic development at the end of the 20th century, enter a new cycle - a cycle of declining economic growth. The problem of cyclical development in the context of the current crisis can be confidently described as a structural transformation of the world economy on the eve of new growth due to the new technological order coming in the near future. If we talk about subjective reasons, then the main one is the US economy, its importance in the world economic processes and her state of the art. The economic system that existed for decades was practically monocurrency, with one dominant component - US dollar, which had the status of the main reserve currency. This caused almost boundless need in its issue printing press worked non-stop. As the world economy grew, the demand increased, the machine worked more and more actively. At the same time, a large (dominant) dollar component in the foreign exchange reserves of the leading economic powers (including Russia) has made these countries hostage to the processes taking place in the US economy.
Today, the world economy is in the downward stage of the fifth Kondratiev cycle and, according to the teachings of Kondratiev, at this stage it was possible to foresee major financial shocks with a high probability. Indeed, the previous crisis in the world economy occurred in 2001 during the recession of the medium-term Zhuglar cycle and was also caused by the financial bubble that burst in 2000 in the field of new economy that flourished in the 1990s. The current crisis occurred just at the recession of the next Juglar cycle lasting 8 years. Since the duration of the crisis is usually 18-24 months, in the current 2010-2011. The recession is ending and the economy is recovering. However, the recovery process will be weak and will not reach a level of sufficiently full economic activity, the increase in production achieved in this case is unlikely to exceed the volumes of the current reduction in production. The logic of the impact of the downward stage of the Kondratiev cycle is such that the crisis that has gained momentum is unlikely to stop at the current levels. Hence - the entry of the world economy into a phase of prolonged slowdown in growth, recession and stagnation. world economy expects a protracted depression, which may last from 2010 to 2018.
Figure 7 shows the fourth and fifth Kondratiev cycles.
The basic innovations of the fourth cycle were nuclear power; quantum electronics and laser technologies; computers and automation of production; satellite communications and television. There was a rapid development of the car - and aircraft industry.
The core of the fifth technological order was microelectronics, personal computers, computer science and biotechnology, the emergence of ATMs and plastic cards, which led to a drop in demand for cash and a change in the velocity of money, the globalization of financial markets, which removed many boundaries in the way of capital movement.
The main characteristics of the 6th technological mode: First of all, these are nanotechnologies, biotechnologies, information and communication technologies, quantum computers, alternative energy sources, technologies of new materials.
How long will the descending phase be, and what significant events will characterize the beginning of the sixth cycle? Most modern researchers agree that the next large-scale global crisis, which will mark the birth of the sixth Kondratiev cycle, will occur in the 10s of our century. This forecast assumes the compression of long cycles - if it is realized in the second decade, then the duration of the fifth cycle will be 36-46 years. Indeed, there is a tendency to shorten the Kondratiev cycles - the first Kondratiev cycle was about 60-65 years (1785 / 90-1844 / 51), the second already - about 50 years (1844 / 55-1890 / 96), the third - no more 42 years old (1891 / 96-1933), the fourth - a little over 40 years old (1933-1974). If the trend towards contraction of long cycles continues, then the crisis and the end of the fifth cycle will indeed occur no later than 2014/15. Why is cycle compression happening? – a question that, in our opinion, does not have a clear answer today. It can be assumed that the reasons lie in the sphere of monetary circulation, namely, an increase in the velocity of money circulation. Indeed, if we consider the Kondratiev hypothesis as basic (the main reason for long cycles lies in the mechanism of accumulation, accumulation and dispersion of capital ...), then changes in the conditions of money circulation, of course, could not but affect the details of this mechanism - the processes of accumulation / dispersion began to occur more rapidly. What technological changes will precede the birth of the sixth cycle?
In technology, the main hopes are now associated with the advent of quantum computers (semiconductor technologies have already approached the natural limit - nanotechnology), the invention of which (development of principles) was announced by IBM in 1998, but the creation of which, of course, will take at least a decade. Breakthroughs in the communications industry are in high demand today (the introduction of 3rd generation communications is a prospect for the next few years). It is still difficult to say what role biotechnology will play on the rising wave of the sixth Kondratieff cycle. In particular, it is difficult to assess the demand for cloning technologies developed in last years. But the demand for genetic engineering from the pharmaceutical industry and medicine is beyond doubt. The third direction of possible technological breakthroughs is research in the field of high energies and the creation of alternative energy sources. However, the required amount of investment in these technologies casts doubt on the possibility of a breakthrough in this direction in the coming years (it is obvious that all these technological breakthroughs must occur in the next decade in order to lay the foundation for the emergence of a new 6th Kondratieff cycle at the turn of the 10-20-20th century). th years). Thus, it can be assumed that the next long wave will be a cycle of quantum computers and biotechnology.
Market expansion. To date, the most attractive areas for the expansion of world trade are China and Islamic countries, gravitating towards fundamentalism. Today, the efforts of developed countries to involve both China and traditional Islamic countries in the orbit of the world economy are quite obvious (the experience of the 5th Kondratiev cycle showed the most effective direction of such efforts - the replacement of independent, national, regimes with friendly, pursuing a Western-oriented policy). However, if in relation to China this process is hidden from the general public in nature, manifesting itself only in selective provocations (such as the bombing of the Chinese embassy in Belgrade), then in relation to closed Islamic states, the process has taken a completely open form, which since 2001 has been called the “international anti-terrorist operation ". It is obvious that in the descending phase of the big cycle, in which we are now, this “operation” will most likely not be successful (it is the analysis of the Kondratiev cycles that casts doubt on the fact that “Shock and Awe” will allow America to achieve its goals; at least At least the post-war reconstruction of Iraq will be very ambiguous), but by the middle of the upward wave of the sixth cycle (ie, tentatively 2025/30), the need for new markets will be more acute than ever. It is these dates that are defined as the most probable for the change of many radical regimes in the Middle East.
The sixth cycle, as mentioned above, must be preceded by some significant changes in the sphere of credit and monetary circulation(obviously already in the current decade). However, it is possible that they have already happened. We are talking about the introduction of a single European currency. The positive impact of this factor on the global economy has yet to be fully felt. Another important change in the monetary sphere is associated with the activation of Internet payments, i.e. payment for services and goods via the Internet. These technologies appeared with the Internet in the 90s. of the last century, but it is obvious that they are not yet fully ready for commercial use and so far allow only a limited range of operations to be performed. More active use of the worldwide network for settlements will certainly change the main parameters of monetary circulation.
2.3 Counter-cyclical policy of the state
To maintain economic stability in society, the state is pursuing an anti-cyclical policy aimed at mitigating cyclical fluctuations. The most important instruments of influence on the economic cycle are monetary and fiscal leverage. During a crisis, government measures are aimed at stimulating production, and during an upsurge, at curbing it. The difference in views on the causes of cyclical fluctuations in the economy entails different approaches to the problem of their regulation. However, in general, all concepts gravitate towards two directions: neo-Keynesian or neo-conservative. The first focuses on the regulation of aggregate demand, the second - on the regulation of aggregate supply.
Proponents of neo-Keynesian recipes pay the most attention to:
1) budget policy(this is mainly due to an increase or decrease in government spending);
2) tax policy (manipulations with tax rates depending on the state of the economy).
Proponents of neoconservative recipes pay the most attention to the problem of money and credit. Neo-conservative policy is based on monetarist theories, prioritizes the volume money supply and its regulation. Despite the differences, there is a common understanding that the state must smooth out cyclical fluctuations in order to achieve and maintain economic stability. In the recession phase, all state measures are aimed at stimulating business activity. In the area of tax policy it means:
1) reduction of tax rates;
2) providing tax incentives for new investments;
3) pursuing a policy of accelerated depreciation.
At the same time, supporters of neo-Keynesian views rely more on growth public spending, which are considered as a stimulant of accumulation. Tax measures are more complementary to budget ones, and in combination they lead to the stimulation of aggregate demand, and, ultimately, production. Neo-conservatives focus more on taxes, the reduction of which leads to increased business activity, but in general they see fiscal policy as an adjunct to monetary policy. Monetary policy during a recession follows the same objectives as fiscal policy and involves a policy of increasing credit. Her goal is to revive economic life in the country with additional loans. At this time, a policy of "cheap money" is being pursued. This means that interest rates for loans issued are decreasing, credit resources of banks are increasing, which leads to an increase in capital investments, increased business activity, and a decrease in unemployment. However, this can also have negative consequences - lead to increased inflation.
During the upswing period, in order to prevent "overheating of the economy", the state pursues a policy of containment, which includes opposite measures in the field of fiscal and monetary policy. The fiscal policy of this period is characterized by an increase in tax rates, a reduction in government spending, and restrictions on the depreciation policy. It is on fiscal policy that the theorists of neo-Keynesian methods of regulation are guided. Fiscal measures lead to a decrease in purchasing power, and hence demand, which leads to a decline in economic activity. In the monetary sphere, a policy of "expensive money" is being pursued, which means exactly the opposite measures: an increase in interest rates on loans, a reduction in bank credit resources. But even in this case, the “dear money” policy can, through a reduction in investment and, accordingly, production, lead to an increase in unemployment. In general, politics can be characterized as a policy of opposition, i.e. measures should go in the opposite direction to the current fluctuations in the economic situation.
Fig. 8 State impact:
– incentive policy;
↓ - containment policy
During the period of recession, the state pursues a policy of activating all economic processes, and during the period of “overheating of the economy”, it seeks to restrain business activity. Inflation has become an integral element of the current economic crisis. It interacts with the cyclical movement of the economy and changes the mechanism of the cycle. Increased fluctuations are facilitated by the monopolization of the economy, corruption, violation of economic proportions, etc. Therefore, all measures taken to overcome them (anti-inflationary policy, the policy of eliminating imbalances, the fight against monopoly, etc.) can also be considered as special cases of regulating the economic cycle.
3. The global crisis and its impact on Russia
3.1 Consequences of the global crisis for the Russian economy
According to Vladimir Putin, the crisis is reminiscent of a "perfect storm," when "natural elements come together at one point and multiply their destructive power." It has a multifaceted character - systemic and cyclical. It is global in nature, not only on a global scale, but also for all sectors of the Russian economy.
The global economic crisis in its impact on Russia has specific features, Related critical issues Russian economy:
1. High dependence on the export of natural resources.
2. Low competitiveness of non-primary sectors of the economy.
3. Underdevelopment of the financial sector.
Since the 20s. of the last century, the waves of Kondratiev bypassed Russia - we developed outside the framework of the global economic cycle. Moreover, during the last wave, we moved in antiphase with the global cycle - the last quarter of a century, which brought the flourishing of the Western economy, for Russia was characterized first by stagnation, and then by the deepest depression. This became a kind of payment for the opportunity to fit into the global economic model and take our place in it.
Does the economic dynamics of recent years in Russia allow us to assume that we are already moving in line with global trends? Is there a relationship (more precisely, Russia's dependence on the global situation), and the hypothetical global crisis of 2014-2015 will not bypass Russia.
Already in 2008, Russia, following the whole world, was gripped by the global financial crisis, which affected many banks, large and small companies, and almost the majority of the country's population. In 2009, it continues to deepen. It is clear that the crisis of 2008 in Russia did not arise on its own. There were certain reasons for this both within the country and abroad.
So many economic experts in Russia are trying to compare the current crisis in Russia with the Great Depression. But is it? What is the mechanism of the crisis in Russia?
The reason for the financial crisis in Russia was that the stock market is highly dependent on foreign investors. With a total volume of the Russian stock market of about 200 billion dollars, almost 70% belonged to foreign investors. In Russia, the virtual stock market has grown steadily and rapidly in recent years. But as soon as investors from the US, Europe and Asia urgently needed funds, they began to sell shares Russian companies. About $100 billion was withdrawn from the Russian stock market. Shares were thrown out in large quantities and fell sharply in price. The stock market crashed.
Banks were the first target of such a fall in the stock market. Russian banks, making life easier for themselves, were not particularly fond of lending to the real production sector, it was much more interesting for them to play on the stock market with temporarily free money of clients without any headache. Banks have lost most of the client money they used to play in the market. Selling shares at new, lower prices meant taking huge losses. The volume of losses has become catastrophic.
As a result, banks have huge holes in their balance sheets; banks cannot give loans to anyone, because. no money.
Over the past decade, the availability of credit in the West has been amazing, and interest rates have been just sweet for business. That is why borrowers from Western banks became the second victim of the collapsed financial market.
Due to problems in their countries, Western banks are beginning to withdraw loans issued to Russian banks and companies, which catastrophically aggravates the situation. The capitalization of the largest Russian companies is falling sharply, calculated on the basis of the prices for shares of companies in the virtual stock market. This is another reason why Western banks began to automatically demand the revocation of part of the loans, and rating agencies began to downgrade the ratings of these companies. The amount of loans also depends on the rating and the amount of capitalization. When these indicators go down, some of the loans are almost automatically withdrawn and the opportunity for the company to take out new loans elsewhere to survive in difficult times disappears.
In general, for banks and large companies that are sitting on a credit needle, the situation of the apocalypse has come.
The financial crisis in Russia was aggravated by the debts of corporations, which are comparable to gold reserves.
The logical consequences of the financial crisis were a slowdown in the pace of economic development and an increase in unemployment. About 50% of Russian enterprises have reduced production volumes. And the financial crisis from 2008 in Russia migrated to 2009 in the form of an economic crisis, adding problems not only to the financial sector and industrial enterprises, now the crisis has reached and touched almost everyone. The downsizing of enterprises and lower incomes will hurt the population of Russia.
Today's Russian economy is a terribly bloated commodity sector. Over the past 10 years since the last default, the country has degraded under the rain of petrodollars. During these years, the Russian budget received 53% of its income from customs payments, which were formed from oil prices and demand for metal. Russia's commodity export-oriented economy faced a situation where demand and prices for raw materials fell. The sharp drop in oil prices from almost $150 to $40 per barrel has very sharply limited the filling of the country's budget
The reduction in personnel in Russia is no less noticeable than in other countries of the world affected by the global economic crisis.
Practically in all sectors of the economy there is a reduction in personnel. However, there are industries in which the largest layoffs are taking place. Industries that were pumped full of money, overstaffed, or simply speculative suffered the most cuts. Those companies that physically do not produce anything, but actually sell air, suffered the most. The exception is builders, who created a real estate bubble that is now deflating, causing massive unemployment in the industry.
After the financial and construction bubbles began to deflate, staff cuts began in companies involved in construction, financial services, and banks. Various PR and advertising agencies, travel agencies began to close. “Office plankton” is released en masse, these are people who simply received a salary for the fact of being at work. High-class specialists remained in their places, although most of them had their salaries cut.
Industries that actually produce something in physical terms, unemployment in Russia has not been affected so much, although it has also been battered. Many enterprises work on loans, but in a crisis it becomes almost impossible or unprofitable to get a loan for production, moreover, the demand for products began to decline.
"The global economic crisis has shown that our affairs are far from being the best. Twenty years of turbulent transformations have not freed our country from the humiliating dependence on raw materials."
"For Russia, the main and not yet fully learned lesson is the departure from our dependence on raw materials. Our post-crisis economy should be based on knowledge, should be based on innovative technologies, and not on Russia's raw material capabilities, no matter how limitless they may be. I will say, by the way, so far we have not had any changes in this area, and despite the fact that the crisis has hit everyone hard, no one really wants to change. The state is not changing as we would like."
And so, to summarize: there was a collapse of the stock market, the flight of foreign capital, the devaluation of the ruble, the depreciation of the shares of almost all large corporations and banks. The scale of the decline in the capitalization of the Russian stock market is incommensurable with the decline of these markets in other countries of the world (the RTS index in Russia fell by about 72%, similar indices in the USA - only by 35%., in China they fell by 49%, in India - by 40% , Brazil by 50%). In addition to external factors, Russian realities are dominated by internal factors. They should include:
1) Overheating the economy with money, when petrodollars and loans at low rates corrupted entrepreneurs and the state.
2) High corporate debt. In a few years, the debt of the largest companies has increased from $100 billion to $500 billion.
Rice. 9 External debt non-state sector
3) Low productivity growth compared to income growth, financial sector growth compared to real sector growth.
4) Decrease in investment attractiveness and outflow of capital from Russia. (The conflicts around BP, Euroset, Mechel and the South Ossetian conflict played their role).
5) Lack of real sources of long-term investments in Russia. More than half of all bank loans to Russian enterprises are loans up to 1 year. Those. money associated not with investments, but with the current replenishment of working capital.
Changes in the structure of the economy - the contraction of competitive industrial sectors in the last decade - is the explanation for why we see almost no examples of import substitution in Russia during this crisis. There is simply no way to see them. If ten years ago, after the crisis of 1998, taking advantage of the devaluation of the ruble, the industry sharply revived, then in recent years it has finally declined, including thanks to the consistent policy of strengthening the ruble. The problem for the coming years will be the question of the survival of the remnants of our engineering in the competitive struggle with the products of Chinese manufacturers. The existing raw material export structure of the Russian economy will not be viable in the post-crisis period. In this regard, any anti-crisis measures should contribute to the diversification of the economy. Compared to the global economic system, our recovery from the crisis will be more costly, more labour-intensive, more demanding of systemic restructuring, and will take longer. However, this does not mean that chances have been missed for Russia. The presence of economic cycles, changes in technological patterns, makes it possible to rebuild the existing world order. The next five to seven years are the most critical for the modernization and diversification of the country's economy, it is in the coming years that the foundations are laid for the innovative leadership of the countries of the next technological order.
3.2 Counter-cyclical policy of the Russian Federation
Analyzing measures to overcome the crisis, it can be stated that the Russian government is pursuing a policy of maintaining stability in the short term. There is no talk of a large-scale modernization of the country's economy. In general, the response of the government was quite logical. In particular, the three largest banks in Russia - Sberbank, VTB and Gazprombank - received 1.5 trillion. rub. to maintain the country's banking system. In total, the government allocated more than 6 trillion rubles for anti-crisis measures. At the very end of September 2008, Prime Minister Vladimir Putin announced that Vnesheconombank would be granted $50 billion to secure the repayment of Russian companies' foreign debt. Depositors are guaranteed 100% security of their investments up to 700 thousand rubles. The state tried to support stock indexes, but abandoned this idea. An attempt to support the exchange in these conditions meant only one thing: to help investors fleeing the country in exporting large sums for the securities they sold. Monetary policy was also ambiguous. For political reasons, the authorities did not dare to completely abandon support exchange rate ruble, and went for a phased devaluation extended over time. The population was given the opportunity to insure against the depreciation of the ruble. In anticipation of a depreciation, banks were not inclined to give ruble loans, and loans in foreign currency for the same reason, potential borrowers did not want to take. In addition, a sharp depreciation of the ruble would become an additional factor supporting domestic production, protecting domestic market from imports of foreign goods, would support exporters, and would also create additional incentives for future inflows of foreign capital in the form of direct investment. Finally, the government proposed a wide package of incentives, primarily tax incentives, to support the development of real production, including tax cuts, measures to support small businesses, and the formation of a list of “backbone” enterprises that receive special attention from the state. From October 2008 in Russia, the customs duty on oil exports has been reduced, the value added tax has been reduced, spending on the construction of infrastructure facilities and support for the real sector of the economy have been increased, customs duty for the import of cars, funds were allocated to support the domestic automotive industry. The Russian government has chosen a socially-oriented model for overcoming the crisis - increasing pensions, wages, and incomes of the population. Support for the social sphere was strengthened, measures were taken to increase employment, prices for medicines and student fees were frozen. The hope was that the domestic market would become more active and boost the economy. Not only does this model not work, but it also forces the budget to shrink in other expenses - there is nothing to stimulate the industry with. Over-regulation of the economy and high welfare spending can:
1. Undermine the foundations of the functioning of the market mechanism
2. Create a dependent mood in the country and reduce labor productivity.
3. The growing incomes of the population are directed either to banks or to imported products. Domestic demand is not stimulated and only hinders the recovery of the economy.
The ongoing anti-crisis policy has led to a relatively rapid transition of the economy to positive growth rates. In the IV quarter of 2009, GDP grew by 1.9%. If the current foreign economic trends persist, GDP growth in 2010 may be about 3.1 percent. But the state has assumed too many social obligations. This may lead to the fact that the share of other expenses will inevitably fall, which will greatly reduce other positions and hinder the development of the economy.
It is rare that a government is ready for a crisis, but the problem of the Russian government is lack of an institution, a mechanism for an adequate assessment of the current situation. All estimates given by the government during the recession - since September 2008. were late. The plan of anti-crisis measures, including the fiscal package, was approved only in April-May 2009, and from the point of view of the economy, it is obvious that the sooner you start pumping in budget money, pushing the economy with this money, the easier it will be to support it. An analysis of the government's anti-crisis program reveals obvious distortions in the direction of supporting the financial sector to the detriment of the real sector of the economy. This happened because the diagnosis was wrong - the crisis was seen as financial and short-term, while it is structural and long-term. The main object of application of anti-crisis measures was chosen incorrectly - the banking system and the financial market. In fact, measures to rescue the banking system should have been considered in the context of a broader recession prevention program. It is planned to allocate 776.5 billion rubles to the real sector of the economy, on which the stability of the financial system largely depends. According to experts, only the leading strategic enterprises of the real sector require at least 3 trillion rubles for structural adjustment. The program does not include targeted measures to support innovative industries. There is no targeted support for the education system, which is done in developed countries. Consequently, it is hardly expedient to count on the modernization of the economy and the cleansing function of the crisis with such a program. No new macroeconomic growth model. Emphasis is placed on administrative measures, which, without the use of market mechanisms and liability norms, turned out to be ineffective and wasteful. Placement of one and a half trillion rubles in commercial banks without collateral, it turned into the export of fifty billion dollars abroad and the destabilization of the ruble exchange rate. In the structure of the anti-crisis package Russian government a lot of emphasis was placed on the non-traditional components of the stimulus package. First of all, this is an increase in pensions; in the conditions of the crisis, not a single country went for an increase in pensions. The next is the rescue of owners, when huge funds were provided to the owners of corporations and financial institutions. The government in a crisis, of course, must save the population (therefore, one can put up with an increase in pensions), the government in a crisis must save some enterprises (they are saving AvtoVAZ, although again they were late), but why did the authorities, having spent enormous resources, saved the owners. It is necessary to take real measures to bankrupt the inefficient oligarchic structures that have accumulated huge debts, for which the state is now paying. All over the world, the bankruptcy of inefficient corporations and banks is one of the most important measures to clean up the economies of "bad" assets, the change of failed owners and managers.
Move away from the policy of increasing government spending and budget deficit to a policy of supporting entrepreneurial activity and domestic demand through tax cuts. Declare a "tax holiday" for small businesses. We need a fiscal stimulus program. High budget spending today - the main obstacle to tax cuts. Dramatically reduce budget spending on the state apparatus, special services and assistance to state enterprises, providing conditions for reducing VAT.
It is necessary to adjust the policy in terms of shifting the focus from measures aimed at anti-crisis support for industries, enterprises and the population, to measures focused on the formation of new industrial potential, modernization, and improving the quality of human capital; investing in basic innovations of the new - now the sixth - technological order (K-cycle), in the "knowledge economy of the future", in the infrastructure of Russia.
Conclusion
What is the current danger? We cut off the cat's tail piece by piece. And we cannot find the bottom from which we could push off in order to rise up and start living again. Let not as luxurious and glamorous as before. But there must be some perspective, clarity! Alas, there is no prospect. The whole world continues to sink into the quagmire. And where is it - the long-awaited bottom? Dont clear. Although already several times hastened to announce that the crisis is over. Now everyone has realized that the crisis is long, protracted. And everyone competes in forecasts of how long the fall will last. 2 years? 3? 5 years? But no one says, due to what we will stop and get out! You have to understand - there is a global process. Capitalism has been developing for 500 years. And everything worked out for him. Few could have imagined that this trend would break and it would be time for the whole world to change. The problem is that the world has accumulated much more capital than the possibilities for its effective use. Capital is always looking for where to make a profit. This is why financial bubbles are inflated. It can be said that MMM has been created on a global scale. Of course, everything is somewhat more complicated than the Mavrodi pyramid. But the essence is the same. The crisis of capitalism really began in the 60-70s. Mexico, Asian countries, Russian default, high-tech crisis in the USA. Sectors and individual countries were constantly shaking. Eventually the process became global. The global crisis has arrived. Five centuries ruled the main principle of capitalism - accumulate and invest. Now the mechanism of accumulation is breaking down before our eyes.
The world has come to a period when it is necessary to update the main production assets on the old technical basis. Capitalism cannot do this either. And never did. Something new always appeared, and the old subsided, simply died off. The new one was more efficient. A crisis of the industrial structure is looming throughout the world. The country that learns to solve these problems earlier and better than others will be stronger in overcoming the crisis. And what happens as a result of the crisis will be a completely new system. Not capitalism. But it will not be socialism, as we knew it in the USSR. Well, at least because the market in it must be preserved. It is not known in what form, but it will be preserved. And how all this will be called - it does not matter.
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3.4 Cyclical economic development
Cyclical development of the economy. The economic cycle and its phases
Cyclicity is a general form of movement of national economies and the world economy as a whole. It expresses the uneven functioning of various elements of the national economy, the change of revolutionary and evolutionary stages of its development and economic progress. Finally, cyclicality is the most important factor in economic dynamics, one of the determinants of macroeconomic equilibrium. Due to the complex, intersecting trends of the various components of cyclicity, it is often extremely difficult to isolate individual cycles. The most characteristic feature of cyclicity - movement - does not occur in a circle, but in a spiral. Therefore, cyclicality is a form of progressive development. Each cycle has its phases, its duration. The characteristics of the phases are unique in their specific indicators. A particular cycle, phase has no twins. They are original both in historical and regional aspects.
Cyclicity is the movement from one macroeconomic crisis to another. At the same time, cyclicity is very sensitive to government impact on the national economy and the world economy as a whole.
An example of cyclicity is shown in Figure 22. 
Rice. 22. Cyclical development of the economy
There are a number of theories explaining the causes of cyclicity:
1) Purely monetary theory. The essence of a purely monetary theory is as follows: the business cycle is the result of a change in cash flow. In essence, it is the only and sufficient reason for the change in economic activity, the alternation of prosperity and depression. In other words, when the demand for goods denominated in money (that is, cash flow) increases, trade becomes brisk, production expands, prices rise. When demand decreases, trade weakens, production decreases, prices fall;
2) The theory of overaccumulation. Central to this theory is the question of the overdevelopment of industries that produce capital goods, or capital goods, in relation to industries that produce consumer goods. All authors of the "overaccumulation theory" start with the fact that industries producing capital goods are much more affected by the economic cycle than industries producing consumer goods. During a boom, the output of capital goods rises, and during a recession, it declines more sharply than the production of non-durable consumer goods;
3) The theory of underconsumption. The essence of the theory of underconsumption, or excessive savings, is as follows:
a) savings can lead to depression, as the savings are not used for investment;
b) savings lead to a reduction in the demand for consumer goods, since the money saved is not spent on consumption.
As a result, there may be a surplus of savings over new investment, and this surplus will increase with each additional act of saving, and the demand for consumer goods will decrease, their supply will increase, and their prices will most likely fall.
Proponents of the theory of underconsumption attach great importance to the market for consumer goods. They believe that as long as the market for consumer goods is successful, the economic system is not threatened by a crisis;
4) "Psychological" theories. Along with economic theories, all greater place occupy "psychological" theories. The authors of the latter primarily include Keynes, Mitchell, Robertson, Repke, Hayek. In their opinion, optimism and pessimism are factors contributing to the expansion and contraction of business activity, along with such objective economic factors as the rate of interest, cash flow, etc. Some try to prove, for example, that the optimism and pessimism of entrepreneurs depend on the policy of banks. People are optimistic as long as credit expands and therefore demand increases, but when credit shrinks and demand weakens, they become pessimistic.
Economic cycle - recurring over a number of years, ups and downs in economic activity, manifested in fluctuations in production volumes, employment and income levels of subjects of economic relations.
There are several types of economic cycles, which are sometimes called waves. They are difficult to distinguish because of the multiplicity of their indicators, because of the temporary blurring of the boundaries between them. The so-called long waves (cycles) have a length of 40-60 years. The development of the theory of long waves began in 1847, when the Englishman H. Clark drew attention to
54-year gap between the crises of 1793 and 1847 He suggested that it was no coincidence that the gap was objectively conditioned. A significant contribution to the development of the theory of long waves was made by his compatriot W. Jevons, who was the first to use the statistics of price fluctuations to explain a phenomenon new to science.
K. Marx made a significant contribution to the theory of cyclicity. He devoted all his attention to the study of short waves, which in the economic literature have received the name of periodic cycles or periodic crises of overproduction.
K. Marx was one of the first economists who began to pay close attention to this problem. He singled out four phases of the cycle, successively replacing each other: crisis, depression, recovery and recovery.
(Fig. 23). In this figure, segment I illustrates the phase of the crisis, segment II - the phase of depression, segment III - the recovery phase and segment IV - the recovery phase. There are other classifications as well. Some modern researchers single out only two phases: recession and recovery. It should be noted that the Marxist school of economics studied exclusively the industrial cycle lasting 7-12 years, treating all other types of cyclicality with prejudice as the products of a hostile bourgeois political economy (Fig. 24).
Rice. 23. Industrial cycle and its phases
The crisis manifests itself primarily in the overproduction of goods, the reduction of loans and the increase loan interest. This leads to a decrease in profits and a fall in production, an increase in bank debts, bank failures and bankruptcies of enterprises and other sectors of the economy. After the crisis comes the depression. Production is no longer declining, but it is not growing either. Commodity surpluses are gradually dissipated, but trade is sluggish. The interest rate drops to a minimum. However, "points of growth" gradually appear in the national economy, and a transition to revival takes place. Enterprises that have adapted to the new market conditions increase the output of goods, carry out new industrial construction, the rate of profit, the rate of loan interest and wages rise, and the phase of growth begins. The level of GNP exceeds the highest pre-crisis point, production continues to increase, employment, commodity demand, the price level and the rate of loan interest are growing. But gradually the scale of production again goes beyond effective demand, the market is overflowing with unsold goods and a new industrial cycle begins.
Mention of long-term fluctuations can be found in the studies of our compatriot M. Tugan-Baranovsky. The theory of cyclicality was also reflected in the works of the Russian scientist A. Telfand (Parvus). He made an attempt to prove that cyclicality is immanent in capitalism. The original statistical processing of the material is contained in the works of the Dutch scientists J. Gelderen and S. Volf. The novelty of their research consisted in the fact that they considered technological progress as a cyclical factor, as well as the timing of the functioning of the transport infrastructure.
It will not be an exaggeration to assert that the leading place in the development of the theory of cyclicity of Kondratiev belongs to N.D. Kondratiev. The recognition of his merits in this area is that many foreign scientists call long waves after him. N.D. Kondratiev, a graduate of the Faculty of Law of St. Petersburg University, opened a broad discussion on the problems of long waves back in the 1920s. A truly world-wide fame was brought to him by the report “Large cycles of the conjuncture”, made at a meeting of the academic council of the Institute of Economics in 1928. Kondratiev’s research covers the development of European countries over 100-150 years. Among the indicators of the conjuncture studied by him are price indices, government securities, nominal wages, foreign trade turnover, coal and gold mining, iron smelting
etc. A great scientific merit of our compatriot should be considered his understanding of the probabilistic nature of the approach in the analysis of statistical series of conjuncture indicators. As a result of research, Kondratiev identified the following large cycles (Table 5).
Table 5
Long Waves in Economics
Climb |
recession |
1789-1814 |
1814-1849 |
1849-1873 |
|
1896-1920 |
1873-1896 |
The greatest scientific merit of Kondratiev is that he made an attempt to construct a theoretical socio-economic system that itself can generate long-term fluctuations.
The reasons for long waves are evolutionary and revolutionary types of scientific and technical progress. He associated the beginning of the "big" rise with the massive introduction of new technologies into production, with the involvement of new countries in the world economy, with a change in gold mining.
The rise of the first big cycle Kondratiev associated with industrial revolution in England, the second - with the development of rail transport, the third - with the introduction of electricity, telephone and radio, the fourth - with the automotive industry.
Modern researchers associate the fifth cycle with the development of electronics, genetic engineering, and microprocessors.
Evidence that the economy is approaching the high point of a large cycle is the beginning of a shortage of certain goods against the backdrop of abundance, shifts in the distribution of income, rising production costs, slowing profit growth, etc. A situation now known as stagflation occurs.
There are various reasons for explaining the reasons for the exhaustion of the lifting energy. Some see them in a noticeable increase in the consumption rate, others in a change in the purchasing power of money, others associate the achievement of the "peak" with life cycle products and industries, the creation of which was the result of major innovations of the past years.
In the second half of the 20th century, such researchers as J. Schumpeter, S. Kuznets, K. Clark, W. Mitchell,
P. Boccara, D. Gordon, T. Kuchinsky. In 1983, 1985, 1987, 1988 and 1992 international symposiums on long waves were held. In Russia, long waves are currently being studied by Yu. Yakovets, L. Klimenko,
S. Menshikov, V. Klinov and others.
In conclusion, we note that cyclic development is a manifestation of the very essence of the development of production, its natural property, the way of its progressive movement. Thus, cyclicality is evidence of the viability of a given social system, evidence of its right to exist.
For a market economy, as noted, periods of predominantly extensive and predominantly intensive types of economic growth are characteristic. This alternation is based primarily on the cyclical nature of the economic movement.
Business cycle and economic crisis.
Cyclical economic development- these are continuous fluctuations of the market economy, when the growth of production is replaced by a recession, the increase in business activity - a decrease. Cyclicity is characterized by periodic ups and downs in market conditions. Periods of increased economic activity are characterized mainly by extensive development, while periods of decreased economic activity are characterized by the beginning of predominantly intensive development. Consequently, the cycle is a constant dynamic characteristic of a market economy; without it, there is no development of the economy.
Business cycle is a form of movement and development of a market economy.
In the economic literature, cycles of various lengths are named after their researchers. So, cycles lasting 3-4 years. are referred to as Kitschik cycles, 10-year cycles - Zhuglar cycles or Marx cycles, 15-20-year cycles - Kuznets cycles, 40-60-year cycles - Kondratiev cycles.
Cyclicity is a form of development of the national economy and the world economy as a whole, it is the movement from one macroeconomic equilibrium on the scale of the economy as a whole to another.
A cycle is a period of time in the development of a market economy, during which there is an increase in the volume of production of goods and services, and then a contraction, recession, depression, recovery, and, finally, its growth again (Fig. 1).
In this graph, the extreme points of the development of a market economy characterize the economic boom and crisis. The recovery of the economy begins with a revival of the phase of recovery of business activity in the form of the conclusion of new business contracts, a gradual and very weak increase in demand for labor, therefore, a reduction in unemployment, an increase in consumer demand. Then begins net growth, which characterizes a constant, increasing increase in the volume of production of goods and services, the highest point of this rise is characterized as a boom. At this time, the economy is at full employment, and production is operating at full capacity. Real output reaches its maximum at this point. Prices tend to rise, and the growth of business activity, having reached full employment of resources, stops and freezes.
The initial phase of the cycle is the crisis ( other names: recession, recession-lat. - retreat). At the time of the recession, there is a drop in the level and rate of economic growth, and then, as a rule, a direct reduction in the scale of output. Such phenomena are associated with overproduction of goods. At this time, stocks of unsold products increase sharply. There are massive bankruptcies (ruin) of industrial and trade enterprises, who can not sell the accumulated goods. Due to the suspension of production, unemployment is growing rapidly, and wages are being reduced. In society, credit ties are broken, the securities market is upset, stock prices are falling. All entrepreneurs are in dire need of money to pay rapidly formed debts, and therefore the rate of bank interest will increase significantly.
After the crisis comes another phase - depression(lat. Depressio - lowering, suppression). Then the decline in production stops, and with it the decline in prices. Stocks are gradually decreasing. Due to insignificant demand, the mass of free money capital increases and the bank interest rate decreases to a minimum. Production and employment, having reached their lowest level, begin to slowly and gradually gain momentum.¶
During a period of depression, the supply of goods will no longer overtake demand, and therefore an equilibrium is established between them (the cessation of the production of goods reduces their supply to the level of demand). At the same time, natural conditions are created for overcoming the crisis. A decrease in prices for means of production and cheaper credit contributes to new accumulation capital, the resumption of expanded reproduction on a new technical basis.
Next phase - revitalization- means the expansion of production to its pre-crisis level. The size of commodity stocks is set at a level necessary for the uninterrupted supply of the market. A slight increase in prices begins, caused by a revival of consumer demand. Unemployment is reduced. The demand for money capital increases, and the interest rate increases.
Finally comes the upswing During this period, output exceeds the pre-crisis level. In this regard, naturally, unemployment decreases or resolves. With the expansion of consumer demand, prices for goods increase. Profitability of production increases. Demand for credit funds increases, and, accordingly, the rate of bank interest increases. The upswing ends with a boom when the economy is operating at its limits, there is full employment, investment and buyer spending is very high.
The economy is overheated and inevitably slides into a new crisis
The direction and nature of changes in the main macroeconomic indicators is called economic conjuncture. Therefore, the theory of economic cycles is also called the theory of economic conjuncture.
Various indicators are used to characterize the state and dynamics, the most important of which are:
· the volume of GNP, the level of employment, the level of utilization of production capacities, the volume of profits of entrepreneurs and other parameters. At the same time, depending on how macroeconomic parameters change during the economic cycle, they can be divided into pro-cyclical, counter-cyclical and acyclic.
Procyclical variables tend to rise during upswings and down during downturns.
Countercyclical variables tend to decrease during upswings and rise during downswings.
Variables are called acyclic, the dynamics of which is not directly related to business cycles. Thus, cyclicality is a form of movement of the national economy of the world economy as a whole, suggesting a change in the revolutionary and evolutionary stages of economic development and economic progress.
K. Marx singled out 4 phases of the cycle successively replacing each other: crisis, depression, revival, recovery. In modern economic literature, the terminology developed by the National Bureau of Economics is widely used. economic research USA, according to which the cycle includes the following 4 phases: top (peak, boom), contraction (recession, recession), bottom (depression), recovery (expansion).
On the graph, time (t) is plotted along the horizontal axis, and production volume (Q) is plotted vertically. Increasing direct OA testifies to the constant economic growth and development of the market economy as a whole.
If we take shorter periods of time, then the dynamics of the development of a market economy, taking into account different periods (100, 50, 8-10 years), can be represented by a different, more accurate schedule.
Economic growth is commonly understood as an increase in the volume of goods and services created over a certain period.
The economic growth- the central economic problem facing all countries. Its dynamics (change) is used to judge the development of national economies, the standard of living of the population, and how the problems of limited resources are solved. Economic growth can be calculated in two ways:
Economic growth is determined by many factors, the most important of which are the factors of demand, supply and distribution.
Constant economic growth in a market economy has a number of significant drawbacks (inflation, unemployment, etc.), including cyclicality. The fact is that the development of a market economy occurs in waves, or cyclically. In different years, production may increase at a greater or lesser rate, and in some cases the development of the economy may have a negative sign, which means a decline in production. Therefore, the dynamics of the development of a market economy is more accurately reflected by a wavy line where each wave characterizes a whole cycle of this development.
At the same time, even cycles of the same order, characterized by approximately equal duration and driving forces, do not resemble one another, but have much in common. As the well-known American economist, Nobel Prize winner (1970) P. Samuelson wrote in his textbook: "They are not twins, but you can trace the features of belonging to the same family in them. Exact formulas, similar to those that apply with a certain movement of the moon or oscillation a simple pendulum cannot be used to predict the change in the phases of the economic cycle. In their violent and unbalanced manifestation, economic cycles are more like waves of epidemic diseases, vagaries of the weather, or temperature fluctuations in a patient.
It is customary to distinguish between extensive and intensive types of economic growth.
In the first case, the increase in the social product occurs due to a quantitative increase in the factors of production: the involvement in production of additional resources of labor, capital (means of production), and land. At the same time, the technological base of production remains unchanged. Thus, the plowing of virgin lands in order to obtain a large number grain crops, the involvement of more and more workers in the construction of power plants, the production of more and more combine harvesters - all these are examples of an extensive way to increase the social product. With this type of economic growth, the increase in production is achieved through a quantitative increase in the number and qualifications of employees and through an increase in the capacity of the enterprise, i.e. increase in installed equipment. As a result, output per worker remains the same.
With an intensive type of growth, the main thing is to increase production efficiency, increase the return on the use of all factors of production, although the amount of labor, capital, etc. used may remain unchanged. The main thing here is the improvement of production technology, the improvement of the quality of the main factors of production. The most important factor intensive economic growth - increased productivity. This indicator can be represented as a fraction: PT = P / T, where PT is labor productivity, P is the product created in physical or monetary terms, T is the cost of a unit of labor (for example, man-hour).
An intensive type of economic growth is characterized by an increase in the scale of output, which is based on the widespread use of more efficient and qualitatively improved factors of production. The growth of the scale of production, as a rule, is ensured through the use of more advanced equipment, advanced technologies, scientific achievements, more economical resources, and advanced training of workers. Due to these factors, an increase in product quality, an increase in labor productivity, resource saving, etc. is achieved.
Scientific and technological progress is an important engine of economic growth. It covers a number of phenomena that characterize the improvement of the production process. The scientific and technical process includes the improvement of technologies, new methods and forms of management and organization of production. Scientific and technological progress makes it possible to combine these resources in a new way in order to increase the final output. At the same time, as a rule, new, more efficient industries emerge. Increasing efficient production is becoming a major factor in economic growth.
The understanding of the cyclical nature of the development of the economy became especially widespread in the late 19th and early 20th centuries, when scientists from many countries paid attention to the dynamics of individual economic indicators. As the phenomenon of cyclicality is studied, more and more new factors are identified that determine it. These include meteorological conditions, psychological errors in assessing the situation, the creation of new industrial equipment and new technology, the amount of accumulation, Bank operations, movement mechanism cash income and entrepreneurship and a number of others. All this provided the basis for the classification of theories of economic cycles, which was most fully presented in his work "Economic Cycles" by W. Mitchell.
The American economist distinguishes the following theories of business cycles:
The range of theories explaining the nature of economic cycles by the functioning of economic institutions is quite large. Some of them, in particular the theory of S. Kuznets, are based on the assertion that cycles arise due to specifications receiving cash income. Fluctuations in profit prospects cause fluctuations in enterprise capitalization and conditional trust, which in turn generate fluctuations in profit prospects. The organization of the money economy is such that it causes fluctuations in the size of orders from merchants, in the production of finished goods and raw materials. The amplitude of these fluctuations consistently increases as we approach the stage of production of raw materials, and it is greater than the amplitude of fluctuations in demand, on which the state of the market and the entire economy directly or indirectly depends.
Other theories proceed from the assertion that cycles arise due to an imbalance in the processes of overall production and consumption of goods. Favorable commercial and industrial conditions lead to a rapid growth of industrial equipment, later to an increase in output and, ultimately, to a fall in the marginal demand prices for consumer goods. The consequence of this is a depression, during which the growth of industrial equipment and products is interrupted. Eventually, the marginal demand prices of commodities rise again, and a new period of recovery begins.
Despite the abundance of works on the problem of cyclicity, there is still no single concept about the reason for the existence of this phenomenon.
The question of the reasons for the cyclicity of modern national economies, depending on the types of cyclicality, is interpreted by different economic schools with an unequal degree of equivalence. Thus, in assessing the causes of "long waves" and structural crises, the approaches of various economists are now largely similar (at least, the ideas of Kondratiev and Schumpeter are recognized by virtually everyone). The causes of "classical", ie, industrial (economic) cycles are defined in different ways.
This explanation of the business cycle is purely monetary. The cycle is considered most widely and consistently as a purely monetary phenomenon in the works of Hawtrey. He argued that the study of cash flow is the only reason for the change in economic activity, the alternation of periods of prosperity and depression, buoyant and sluggish trade. When the flow of money (or the demand for goods, expressed in money) increases, then trade becomes more lively, production expands, prices rise. When the cash flow decreases, trade weakens, production decreases, prices fall.
The demand for goods, expressed in money terms, is directly determined by consumer costs or consumer costs. This means that such a state as general depression is caused by monetary factors. The only exceptions are those cases where non-monetary factors lead to a drop in consumer costs. The amount of consumer spending changes due to changes in the amount of money. A sudden reduction in quantity, that is, outright deflation, has a depressing effect on economic activity. So, according to this theory, the process of contraction or recession occurs as follows. Reducing the amount of money entails an inevitable reduction in demand. Producers who have made products based on ordinary demand are faced with the fact that they cannot sell these products at the expected prices. Inventories will begin to accumulate, losses will arise, production will decline, unemployment will spread, and the process of reducing wages and other incomes will inevitably begin. The process of reducing business activity is cumulative. When there is a fall in prices, wholesalers tend to assume that it will continue in the future. According to these assumptions, they seek to reduce inventory and reduce or eliminate orders to manufacturers. But the expenditures of the consumers, as well as the incomes, are diminishing, the demand is waning, and stocks, in spite of all the efforts of the merchants to reduce them, are piling up; credit continues to decline. Thus, the movement is in a spiral. The up phase of the business cycle is a copy of the down spiral of depression, but the spiral in this case will be upward. The revival of business activity is caused by the expansion of credit and lasts as long as this expansion continues.
Numerous studies by scientists from France, Germany, the USA, Russia were devoted to clarifying the very foundations of the movement of the conjuncture and trying to predict it. In 1894, the Russian economist Mikhail Ivanovich Tugan-Baranovsky (1865-1918), one of the first domestic scientists and economists who gained worldwide fame, published the book "Industrial Crises in Modern England, Their Causes and Immediate Influence on People's Life", which became an important milestone in the study of the laws of the market economy. In this work, he explored a number of fundamental problems related to the cyclical development of the capitalist economy. He managed to offer approaches to this issue that were new for that time, substantiate fundamentally important conclusions, many of which were confirmed by the real economic history of the 20th century.
Tugan-Baranovsky has been studying the cyclical development of the economy all his life, highlighting new problems and significantly supplementing previous observations and conclusions. The second edition of his book entitled "Industrial Crises. An Essay on the Social History of England" made a huge impression in the West - many of the questions he raised were so unexpected. In the preface, Tugan-Baranovsky described the tasks of his work as follows: "This book is devoted to the study of the most mysterious and incomprehensible phenomenon of the economic system of our time, a phenomenon that still remains unexplained in science - periodic industrial crises.
The mechanism of the cyclical development of the capitalist economy was presented by M.I. Tugan-Baranovsky as follows. In search of a profitable application, free money capital puts constant pressure on production. And as soon as it penetrates there, a chain reaction begins - the expansion of any one industry requires the expansion of related industries, and the revival gradually covers the entire national economy, and in the first place - the industries that produce the means of production, since any expansion of production requires an increase in fixed capital . Gradually, with the revival of the entire national economy, previously free money capital is intensively attracted to the production sphere through credit system and turn from a potential purchasing power into an active one, increasing demand and creating a positive conjuncture. But as soon as the expenditure of free capital exceeds the rate of its accumulation, the reserve created during the period of stagnation will gradually be exhausted and the increase in demand will cease. The cessation of the flow of free money capital is expressed in an exchange crisis, which completely disrupts the credit system. As free cash capital is spent, new enterprises are built, and as soon as their construction is completed, they turn from demand-forming elements into supply-forming elements. The market position is changing. Now supply begins to outstrip demand, market conditions deteriorate sharply, commodity prices fall so much that they cannot cover the costs of production. Such, according to the scientist, is the mechanism of the cyclic movement of the capitalist economy.
At the same time, the phases of the cycles have different dates. According to Mitchell's observations, the recession and recovery phases are shorter than the heyday and depression phases, on average, the heyday lasts somewhat longer than the depression. "The relationship between flourishing and depression is most clearly revealed during periods of an upward trend in wholesale prices, and, conversely, less clearly during a period of their downward trend; the existence of relatively long cycles is due more to the lengthening of the depression than to the heyday." It would be logically correct to assume, the scientist believed, that if the opinion about the continuous progressive development of the national economy while maintaining a certain proportionality of social production is true, then the opposite position is also true - if the preservation and constant maintenance of the proportionality of social production is impossible due to objective reasons, then the national economy will develop in leaps, alternations of periods of rise and depression.
The most profound development of the concept of economic cycles falls on the period between the two world wars and is associated primarily with the work of a student of M.I. Tugan-Baranovsky - an outstanding domestic economist N.D. Kondratiev. It is Kondratiev who is credited with creating the first systematic concept of cyclical fluctuations in the economy. The scientist significantly expanded the empirical base of research. He put forward a hypothesis about the mechanism of long cycles in the economy ("large cycles of the conjuncture" in his terminology), linking them not only with price dynamics, but also with the process of capital accumulation, production growth rates and innovation dynamics, with the constant evolution of the national economy.
Theory of long cycles Kondratiev is formulated as follows: "Economic elements capitalist society are never in equilibrium. They only aspire to it, describing undulating movements around the level of their equilibrium. At the same time, in connection with the development of the national economy, the level of equilibrium itself is constantly evolving. Thus, we can say that economic elements fluctuate around a changing level of equilibrium.
Taking into account that various economic elements, by their very nature, have conjunctural waves of different duration, we can speak of different types of equilibrium in relation to different periods of time.
As a rule, the main types of productive forces have the longest period of operation (the main and largest construction projects, railway construction, canal digging, major land reclamation, skilled labor personnel, etc.). The period of intensified construction of these capital goods is a period of deviation of the real level of economic elements upward from the existing level of equilibrium. The period of calm in their construction is, on the contrary, the period of movement of the real level of economic elements to the level of equilibrium and even below it (during these processes the level also changes). Thus, the great cycles of the conjuncture represent the processes of deviations of the real level of the elements of the capitalist system from the evolving level of equilibrium of this system.
According to Kondratiev, the movement of long-term oscillations occurs according to the following principle: before the start of a large cycle, a sufficient amount of free funds- the growth of bank reserves, which allows creditors to reduce interest rate. Interest on long-term premises is low. During the previous period of decline accumulated a significant number of technical innovations (inventions). In the presence of these conditions, capital investment in large structures begins to increase, which causes serious changes in the conditions of production (technical opportunities for making a profit are created), while production becomes profitable, and then, accordingly, an upward wave of a large cycle of economic conjuncture follows.
Despite ongoing disputes about the accuracy and representativeness of the statistical data used by Kondratiev, it is considered established, firstly, the existence of a long cycle in economic development, during which the dynamics of many economic indicators change from the phase of rise to the phase of decline, and vice versa; secondly, the presence of interrelation between spasmodic changes in the productive forces and the corresponding economic relations with similar changes in all other social structures. It is no coincidence that during the ascending wave the number of social upheavals, wars and revolutions increases, and during the descending wave their number relatively decreases.
Business cycle model. The decisive role of uneven investment in the intensity of cyclical fluctuations is taken as the basis for constructing a model of the economic cycle. Representatives of the neo-Keynesian direction of economic thought (P. Samuelson, E. Hansen, J. Hicks, E. Domar, R. Harrod), recognizing the key importance of consumer and investment demand in the formation of a cycle, believe that cyclical fluctuations are more affected by capital investments and to a lesser extent consumption.
The economic cycle is viewed by neo-Keynesians as a deviation from the state of dynamic equilibrium, characterized by stable uniform growth rates of national income (with constant accumulation and the implementation of the state policy of stabilizing the economy).
Neo-Keynesian business cycle model(for example, the Samuelson-Hicks model) is based on the combination of the concept of a multiplier and an accelerator. According to Keynes' concept of the multiplier, the relationship between the growth of capital investment and national income is a constant value determined by the stability of the share of consumption in the growth of national income. The accelerator concept characterizes the inverse relationship between the increase in national income and the subsequent increase in investment. The accelerator shows how much investment should increase for a given increase in national income. The acceleration period is characterized by other conditions than the multiplication period. During this period, the growth of national income will expand production and increase investment, and the decline in the rate of national income will lead to a decrease in the rate of investment.
Small and large cycles of economic development do not oppose each other, but interact, complementing each other. This is expressed as follows:
both small and large cycles are a form of economic movement, development. In any cycle, each subsequent phase is a consequence of the cumulative accumulation of conditions during the previous phase. Each new cycle naturally follows another, just as one phase of the same cycle is replaced by another. The cycle combines the limits and reserves of development, cyclic crises are not only a violation of the balance, but also the initial moment of the restoration of balance. The negative consequences of crises necessitate social protection of the population. This function is performed by the state. At the same time, being the impetus for a new round of development, the crisis is accompanied by the stimulation of economic development by the state. As a result, in a market economy, economic cycles as a form of movement combine spontaneous and organized beginnings;
The basis of the mechanism of short-term and long-term periodic oscillations is scientific and technological progress. In small cycles, the crisis is an impetus for the modernization and technical improvement of production, and consequently, for the expansion of the market. In large cycles, crisis processes require the introduction of basic innovations. This stimulates not only the growth of production, but also the restructuring of the entire economy and the mechanism of its functioning. Consequently, large cycles are characterized not only by the expansion of the market, but also by the creation of new ones;
both small and large cycles in the economies of developed countries move relatively synchronously, forming world cycles;
small cycles are an organic part of large cycles. If they arose in the downward phase of large cycles, then they are characterized by the depth of the crisis, the duration of the depression, the weakness and brevity of the rise. The upward phase of large cycles is characterized by small cycles with strong ups and weak depressions.
Thus, small cycles are rather associated with economic growth, since economic growth is primarily a steadily expanding sales of products. It is characterized by quantitative changes in macroeconomic indicators, a deeper change in the accumulation of capital, accompanied by an increase in the material wealth of society. The state of development means that impulses are generated within the economy for a fundamental change in its technological structure. Business entities are ready to form plans for the accumulation of real capital. A large number of innovations appear on the market: goods, services, technologies, resources or new markets. Their appearance is due to the fact that entrepreneurial activity is aimed at finding new development guidelines, since the previous goals have already been achieved. Innovation becomes a market benchmark for a mass of entrepreneurs. Determining the direction of development, they create a more or less capacious market, first for the factors of production (innovations in labor and capital), and then for the entire output. And the more effective new technologies are, the wider they are distributed in production, the more capacious the market for final products and the stronger the impetus given by innovations to the entire economy, the more successful the accumulation of real capital, the greater the growth of its efficiency or productivity. This is the result of a stage of development that provides growth and prosperity for decades. Such changes in the state of the economic system over time are associated with large economic cycles (long waves), which contain the logic of the system's development.
The economy is not static. She, like a living being, is constantly changing. The level of production and employment of the population is changing, demand is growing and falling, commodity prices are rising, stock indices are collapsing. Everything is in a state of dynamics, eternal circulation, periodic fall and growth. Such periodic fluctuations are called business or business cycle. The cyclical nature of the economy is characteristic of any country with market type management. Business cycles are an inevitable and necessary element in the development of the world economy.
(economic cycle) is a periodically repeating fluctuation in the level of economic activity.
Another name for the business cycle is business cycle (business cycle).
In fact, the economic cycle is an alternating rise and fall in business activity (social production) in a single state or around the world (some region).
It is worth noting that although we are talking here about the cyclical nature of the economy, in fact, these fluctuations in business activity are irregular and poorly predictable. Therefore, the word "cycle" is rather conditional.
Reasons for business cycles:
It is customary to distinguish 4 main phases of the economic (business) cycle, they are shown in the figure below:
The main phases of the economic (business) cycle: rise, peak, recession and bottom.
Period of the economic cycle- the time interval between two identical states of business activity (peaks or bottoms).
It should be noted that, despite the cyclical nature of GDP fluctuations, its long-term trend has upward trend. That is, the peak of the economy is also replaced by depression, but each time these points move higher and higher on the chart.
The main phases of the economic cycle :
1. Rise (revival; recovery) is the growth of production and employment of the population.
Inflation is low and demand is picking up as consumers seek to make purchases they put off during the previous crisis. Innovative projects are implemented and quickly paid off.
2. Peak- the highest point of economic growth, characterized by a maximum of business activity.
The unemployment rate is very low or virtually non-existent. Production facilities operate as efficiently as possible. Inflation usually picks up as the market becomes saturated with goods and competition increases. The payback period increases, the business takes more and more long-term loans, the possibility of repayment of which is reduced.
3. Recession (recession, crisis; recession) - a decrease in business activity, production volumes and investment levels, leading to an increase in unemployment.
There is an overproduction of goods, prices are falling sharply. As a result, the volume of production decreases, which leads to an increase in unemployment. This causes a decrease in the income of the population and, accordingly, a reduction in effective demand.
A particularly long and deep recession is called depression (depression).
The Great Depression Show
One of the most famous and longest global crises is “ The Great Depression» ( great depression) lasted about 10 years (from 1929 to 1939) and affected a number of countries: the USA, Canada, France, Great Britain, Germany and others.
In Russia, the term "Great Depression" is often used only in relation to America, whose economy was hit especially hard by this crisis in the 1930s. It was preceded by a precipitous decline in the stock price that began on October 24, 1929 ("Black Thursday").
The exact causes of the Great Depression are still a matter of debate among economists around the world.
4. Bottom (through) - the lowest point of business activity, characterized by minimum level production and maximum unemployment.
During this period, an excess of goods diverges (some at low prices, some simply spoil). The fall in prices stops, production volumes increase slightly, but trade is still sluggish. Therefore, capital, not finding application in the sphere of trade and production, flocks to banks. This increases the money supply and leads to lower interest rates on loans.
It is believed that the "bottom" phase usually does not last long. However, as history shows, this rule does not always work. The previously mentioned "Great Depression" lasted for 10 years (1929-1939).
Modern economic science knows more than 1,380 different types of business cycles. Most often you can find a classification according to the duration and frequency of cycles. According to it, the following types of economic cycles :
1. Short-term Kitchin cycles- Duration 2-4 years.
These cycles were discovered back in the 1920s by the English economist Joseph Kitchin. Such short-term fluctuations in the economy Kitchin explained the change in world gold reserves.
Of course, today such an explanation can no longer be considered satisfactory. Modern economists explain the existence of Kitchin cycles time lags- delays in obtaining by firms the commercial information necessary for decision-making.
For example, when the market is saturated with a product, it is necessary to reduce the volume of production. But, as a rule, such information is received by the enterprise not immediately, but with a delay. As a result, resources are wasted in vain, and a surplus of hard-to-sell goods is formed in warehouses.
2. Medium-term Juglar cycles– duration 7-10 years.
For the first time this type of economic cycles was described by the French economist Clement Juglar, after whom they were named.
If in Kitchin cycles there are fluctuations in the level of utilization of production capacities and, accordingly, the volume of commodity stocks, then in the case of Juglar cycles, we are talking about fluctuations in the volume of investments in fixed capital.
Added to the information lags of Kitchin cycles are delays between acceptances investment decisions and the acquisition (creation, construction) of production capacities, as well as between the decline in demand and the liquidation of production capacities that have become redundant.
Therefore, Juglar cycles are longer than Kitchin cycles.
3. Rhythms of the Blacksmith– Duration 15-20 years.
They are named after the American economist and Nobel laureate Simon Kuznets, who discovered them in 1930.
The blacksmith explained such cycles demographic processes(in particular the influx of immigrants) and changes in the construction industry. Therefore, he called them "demographic" or "building" cycles.
Today, some economists view Kuznets rhythms as "technological" cycles driven by technology upgrades.
4. Long Kondratiev waves– duration 40-60 years.
Discovered by Russian economist Nikolai Kondratiev in the 1920s.
Kondratiev cycles (K-cycles, K-waves) are explained by important discoveries in the framework of scientific and technological progress (steam engine, railways, electricity, internal combustion engine, computers) and the resulting changes in the structure of social production.
These are the 4 main types of economic cycles in terms of duration. a number of researchers distinguish two more types of larger cycles:
5. Forrester cycles- Duration 200 years.
They are explained by the change in the materials used and energy sources.
6. Toffler cycles– duration 1000-2000 years.
due to the development of civilizations.
Economic cycles are very diverse, have different duration and nature, but most of them have common features.
Basic properties of economic cycles :
Interesting neo-Keynesian Hicks–Frisch business cycle model with strict logic.
The neo-Keynesian Hicks-Frisch business cycle model.
According to the Hicks-Frisch business cycle model, cyclical fluctuations are caused by autonomous investments, i.e. investments in new products, new technologies, etc. Autonomous investments do not depend on income growth, but rather cause it. An increase in income leads to an increase in investment, depending on the amount of income: multiplier effect - accelerator.
But economic growth cannot occur indefinitely. The growth barrier is full employment(line AA).
Since the economy has reached a state of full employment, further growth in aggregate demand does not lead to an increase in the national product. As a result, the rate of wage growth begins to outpace the rate of growth of the national product, which becomes inflation factor. Rising inflation has a negative impact on the state of the economy: the business activity of economic entities is falling, the growth of real incomes is slowing down, and then they fall.
Now the accelerator is acting in the opposite direction.
This continues until the economy hits the line BB – negative net investment(when net investment is insufficient even to replace depreciated fixed capital). Competition is intensifying, the desire to reduce production costs encourages financially stable firms to start updating fixed capital, which ensures an upswing in the economy.
Galyautdinov R.R.
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