Long-term cycles in society
One of the debated points when it comes to regime shifts is wether the observed pattern is a real shift or part of a cycle. The short answer is always: “it depends on the scale and your problem of interest”. However, even cyclical dynamics can undergo regime shifts when accelerated or decelerated. Such is the case of outbreaks frequency in social-ecological systems.
Last week The Economist publish a short note referring to long-term cycles in society. The author comments:
The recent rebound in global food prices has revived talk of a “commodity supercycle” in which raw-materials prices will be high for a prolonged period. Low prices in the 1980s and 1990s led to a lack of investment and the abandonment of marginal sites. Eventually this caused a shortage and rising prices. Such prices will eventually encourage greater production and efforts to find new sources of supply. This cycle will surely be variable in length: you would expect agriculture to adjust more quickly than mining.
Given that the global economy was largely agricultural until 1850, it was logical for the commodity cycle to drive overall activity. But the switch to a manufacturing-based economy brought no end to the pattern of booms and busts.
Various academics have argued that industrial economies also have a regular cycle, fuelled by stocks, capital investment or technological change, and lasting anywhere from three to 60 years. As with commodities, the driving force seems to be the shift from feast to famine as firms overinvest and overproduce, driving down profits and prices until a crisis occurs.
It seems to describe poverty and rigidity traps but in a higher scale and longer time frames than usually studied. The author concludes by suggesting that such cycles seems to be moving towards undesirable space parameters for society:
As Chris Watling of Longview Economics points out, the worry is that several long-term cycles seem to be moving in a hostile direction for Western economies, with commodity prices rising, populations ageing and the debt spree unwinding. That is not necessarily bad news for financial markets next month, or even next year. But it does suggest that a very awkward decade lies ahead.