Kondratiev long waves, also known as Kondratiev cycles or K-waves, are economic cycles proposed by Russian economist Nikolai Kondratiev in the 1920s. He suggested that capitalist economies experience long-term cycles of approximately 50 to 60 years, characterized by alternating periods of growth and decline.
According to Kondratiev, each long wave is driven by a technological revolution that sparks significant changes in various sectors of the economy. These technological revolutions are associated with specific industries or sectors that serve as the primary drivers of economic growth during that wave. Kondratiev identified five major waves:
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Steam and Mechanization (1780s to 1840s): The first wave was characterized by the development of steam power and the mechanization of industries. It involved the adoption of steam engines in manufacturing, leading to significant productivity improvements and the rise of the textile and manufacturing sectors.
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Railways and Steel (1840s to 1890s): The second wave was fueled by the expansion of railways and the development of the steel industry. The construction of rail networks facilitated transportation and trade, while the mass production of steel enabled the construction of infrastructure and machinery.
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Electricity and Chemicals (1890s to 1940s): The third wave saw the widespread adoption of electricity and the emergence of the chemical industry. Electricity revolutionized manufacturing, transportation, and communication, while the chemical industry produced new materials and products.
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Cars and Petrochemicals (1940s to 1990s): The fourth wave was characterized by the rise of automobiles and the petrochemical industry. The mass production of cars transformed transportation and influenced urban development, while petrochemicals became essential for various industries.
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Computers and Information Technology (1990s to present): The current fifth wave is driven by the development and widespread adoption of computers and information technology. The digital revolution has transformed communication, commerce, and various industries, with advancements such as the internet, mobile devices, and artificial intelligence shaping the modern economy.
Kondratiev's long waves theory suggests that each wave goes through distinct phases of expansion, maturation, stagnation, and decline. The transitions between waves can be turbulent, as the old industries decline, and new industries emerge. However, it is important to note that the Kondratiev cycles theory has faced criticisms and debates among economists, and its application to the modern economy is subject to interpretation and scrutiny.