gold stein, joshua prosperity and war in the modern age

8/3/2019 Gold Stein, Joshua Prosperity and War in the Modern Age

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Long Cycles: Prosperity and War in the Modern Age


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LONG CYCLESProsperity and War in the Modern Age

JOSHUA S . GOLDSTEINYale University Press: New Haven and London


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Copyright CO 19 88 by Yale University .All rights reserved .This book may not be reproduced, in whol eor in part, including illustrations, i nany form (beyond that copying permitted b ySections 107 and 108 of the U .S . Copyright La wand except by review ers for the public press) ,without written permission from the publishers .Set in Times Roman type byKeystone Typesetting, Orwigsburg, PaPrinted in the United States of America byEdw ards Brothers, Inc ., Ann Arbor, Mich .Library of Congress C ataloging-in-Publication Dat aGoldstein, Joshua 5 ., 1952Long cycles : Prosperity and w ar in the modern age .

Revision of thesis (Ph .D .)Massachusett sInstitute of Te chnology .Bibliography : p .Includes index .1 . Long waves (Economics) 2 . Business cycles .

I . Title .HB3729 .G64 1988

338 .5 '42

8710723ISBN 0300039948 (alk . paper)ISBN 030004 1 1 28 (pbk . : alk . paper)

The paper in this book meets the guidelines forpermanence and durability of the Committee o nProduction Guidelines for Book Lo ngevity of th eCouncil on Library Resources .10 9 8 7 6 5 4 3 2The author gratefully acknow ledges permission t oreproduce the follow ing : Table 6 .1 appeared originallyin Jack S . Levy, "Theories of General Wars," W orldPolitics 37, no 3 (April 1985), 1985 by Princeto nUniversity Press ; reprinted by permission of Princeto nUniversity Press . Figure 13 .8 appeared originally i nS . H . Steinberg, The T hirty Y ears' W ar and theConflict for European Hegemo ny, 1600-1660, 19 66by S . H . Steinberg ; reprinted by permission of W . W .Norton & Company .


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For my teachers


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Generally, operations of war require . . . 100,000 mailedtroops . . . . [E]xpenditures . . . will am ount to one tho usan dpieces of gold a day . After this money is in hand, 100,000 troop smay be raised . . .Where the army is, prices are high ; when prices rise the wealthof the people is exhausted . W hen w ealth is exhausted the peasan-try w ill be afflicted w ith urgent exactions . W ith strength thus de-pleted and wealth consumed the households in the central plain sw ill be utterly im pov erished and seven-tenths of their wealth dis-sipated-SunTzu, The A rt of W ar (ca . 400 B .c .)


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CONTENT S

1 . World System and World Views 1PART ONE Debates

2 . The Long Wave Debate 1 : Roots 2 13 . The Long Wave Debate 2 : The Current Debate 404 . The Long Wave Debate 3 : Empirical Arguments 645 . The War/Hegemony Debate 1 : Roots 9 96 . The War/Hegemony Debate 2 : The Current Debate 1237 . Knowledge Cumulation in the Long Cycle Field 148

PART TWO Analysis8 . Defining Long Cycles : Epistemology and Methodology 17 59 . Data Analysis 1 : Prices 195

10 . Data Analysis 2 : Real Economic Variables 21 111 . Data Analysis 3 : War 23 412 . Toward a Theory of Long Waves 25 8PART THREE History13 . Continuity and Change : 1495 to 1648 28 114 . Continuity and Change : Since 1648 31 415 . The Past and the Future 348Appendix A . Data Sources 379Appendix B . Time Se ries Listings of Econo mic and W ar Data 38 7References 39 9Index 427


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LIST OF FIGURES

1 . 1 : The triangulation of world views . 92 . 1 : The long wave debate in round one . 222 . 2 : Kondratieff's long waves . 262 . 3 : Trotsky's curve of capitalist development . 282 . 4 : U.S. w holesale prices . 3 52 . 5 : Imbert's theoretical long wave scheme . 3 73 . 1 : Structure of the long wave debate . 4 13 . 2 : Mandel's long waves in class struggle . 433 . 3 : Forrester's long waves in capital . 483 . 4 : Mensch's metamorphosis model . 5 13 . 5 : Rostow's British sectoral growth patterns . 5 74 . 1 : Van Ewijk's spectra of price series . 784 . 2 : Sterman's actual and simulated U .S . GNP . 924 . 3 : Mensch's swells of basic innovations . 935 . 1 : An overview of the war/ hegemony debate . 1005 . 2 : Namenwirth's forty-eight-year value change cycle . 1065 . 3 : Farrar's modern battles by type of war . 12 16 . 1 : The current war/hegemony debate . 1246 . 2 : Hopkins and Wallerstein's paired long waves . 1366 . 3 : Doran and Parsons' relative power curves . 1427 . 1 : Six current schools of long cycle research . 15 17 . 2 : Long wave scholars' nationalities/languages . 1577 . 3 : Long wave conferences in 1983 . 1598 . 1 : Phase periods in five long wave models . 18 88 . 2 : Paired t-tests . 18 98 . 3 : Phases defined by rates v . levels . 19 18 . 4 : Schematic lag structure . 19 29 . 1 : Lag structure, South England consumer prices . 2059 . 2 : Lag structures, four national price indexes . 20710 . 1 : Lag structures, world industrial production . 21 510 . 2 : Lag structures, four innovation series . 221


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List of Figures i x10 . 3 : Lag structure, "improvement" innovations . 22 210 . 4 : Lag structures, four invention series . 22 611 . 1 : Great power war severity, 1495-1975 . 24 011 . 2 : ACFs for war severity, 1815 on and 1495 on . 24 511 . 3 : Battle fatalities by long wave phases . 24 811 . 4 : Great power war, prices, and phase periods . 25 011 . 5 : Lag structure, war severity . 25 411 . 6 : English-French battle deaths, 1300-1500 . 25 512 . 1 : Sequence and timing of idealized long wave . 25 912 . 2 : Adduced causality, production/war/prices/wages . 26012 . 3 : Primary causal sequence of long wave . 26 112 . 4 : Great power wars and national production . 26612 . 5 : Military spending and productivity . 26712 . 6 : Timing of production growth and price levels . 27 212 . 7 : Theoretical model of long wave dynamics . 27 513 . 1 : Europe: physical geog raphy . 29 113 . 2 : The major nations . 29 113 . 3 : Towns in contact with the Champagne fairs . 29213 . 4 : Decline of Venetian trade routes . 29 413 . 5 : Voyages of discovery, circa 1500 . 29513 . 6 : Textile industry in the northern "pole ." 29713 . 7 : Baltic trade around 1400 . 29913 . 8 : Europe around 1610 . 30713 . 9 : Spanish military corridors, circa 1600 . 30813 .10 : The general crisis of the seventeenth century . 31 013 .11 : "The hanging," Jacques Callot, 1633 . 31 114 . 1 : European overseas empires, circa 1700 . 32014 . 2 : Russian expansion in Siberia, 1550-1660 . 32214 . 3 : Europe in 1740 . 32514 . 4 : The colonial empires, 1914 . 33 515 . 1 : U.S . defense outlays as a percent of GN P . 35 215 . 2 : Indicators of declining U .S . hegemony . 35 415 . 3 : The rise and decline of U .S . production hegemon y . 35 515 . 4 : U.S . corporate profits and net interest . 35 615 . 5 : Historical path and future projection . 35 815 . 6 : Clustering of Keohane and Nye's cases . 359


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LIST OF TABLES

4 . 1: Summary of empirical studies . 7 64 . 2: Kondratieff's equations for secular trends . 8 34 . 3 : Mandel's statistical evidence for long waves . 8 44 . 4: Results of Van Duijn's analysis . 8 95 . 1: Weber's economic and value cycles compared . 10 85 . 2 : Toynbee's war-and-peace cycle . 1 1 66 . 1 : Comparison of definitions of general war . 14 67 . 1 : Hypothesized causal relations : long w ave . 16 38 .

1 : List of economic time series . 18 2

9 . 1 : Prices: grow th rates by phase period . 19 69 . 2 : T-test results for tw enty-eight price series' . 20 39 . 3 : Possible lags in other authors' datings . 2099 . 4: Summary of lags in price series . 21 0

10 . 1 : Production: grow th rates by phase . 21 210 . 2 : T-test results for ten production series . 21 410 . 3: Production: grow th w ith phases shifted . 21 610 . 4: T-test results for production with shifts . 21 710 . 5 : Innovation: grow th rates by phase . 21 910 . 6: Innovation: changes in mean levels . 22010 . 7 : Innovation: grow th w ith phases shifted . 22310 . 8 : T-test results for four innovation series . 22 410 . 9: Invention: grow th rates by phase . 22510 .10 : Capital investment: grow th rates by phase . 22710 .11 : Trade : grow th rates by phase . 22 910 .12 : Real wages: grow th rates by phase . 23 010 .13 : T-test results for two real wage series . 23 110 .14 : Provisionally accepted economic ; hypotheses . 23 21 1 . 1 : Membership in Levy's "great power system" . 23 51 1 . 2 : Levy's list of wars . 23 61 1 . 3 : Dating of long war cycles, 1495-1975 . 24 11 1 . 4: Great power wars by phase period . 2461 1 . 5 : Selected war indicators by phase period . 24711 . 6: Major inflation periods and associated wars . 25 211 . 7 : Granger causality results for war and prices . 25 313 . 1 : Summary of historical hegemony cycles . 28513 . 2 : Spanish imports of American gold and silver . 30 314 .

1 : Estimated real per capita national product . 32 8

14 . 2 : Succession of hegemonic wars, hegemons, and challengers . 346x


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PREFACE

As this book goes to press, the connection between eco-nomics and war is a "hot topic ." Both the American and Soviet economies ,struggling under the burden of large military expenditures, are facing major obstacle sto sustained prosperity . In the United States, these take the form of massive debts andgovernment and trade deficits . The Reagan administration military buildup ha sslow ed substantially for reasons of cost, but the price tag for 198085 w ill be w ith u sfor some years to come . In the Soviet Union, economic growth has been extremel ysluggish in recent years, partly as a result of central planners' allocation of invest-men t to the military rather than consumption an d other sectors .This, how ever, is not a book about current events . It explains neither how to solvethe debt problem, nor when the next war will break out, nor even how to get richplaying long cycles on the stock ma rket . It does, I hope, offer new perspectives an dinsights for thinking about current issues in light of longer-term historical processes .The roots of this book go back to two experiences I had in 1970 . First, my high-school social studies class heard a lecture by Professor Robert North of Stanford' spolitical science department, w ho described how researchers w ere using quantitativeanalyses and comp uters to better understand conflict, escalation, and w ar . I found theidea irresistible and w ent on to w ork w ith Professor N orth during a goo d part of th enext decade . Second, as a freshman at Stanford I took a seminar from Pierre N oyes, atheoretical physicist, on "the terrestrial revolution ." This seminar dealt with long-term social evolution on plane t Earth and introduced m e to Marxist traditions, amongother things .Later in the 1970s I had the good fortune to w ork w ith the late Professor Willia mLinvill, head of the Stanford Department of Engineering-Economic Systems. Pro-fessor Linvill show ed me ho w to look at economics from a broad social perspectiv eand how to bring numbers to life and play w ith them . As I complete this boo k, I lookback gratefully to the con tributions of these three tea chers in particular .

The book itself is a revised version of my Ph .D . thesis, completed at the MITDepartment of Political Science under the supervision of Hayward R . Alker, Jr .Without Professor A lker's intellectual and practical support over the past four years ,the book could never have taken form .

Past research on long cycles has the reputation of being at best a well-meanin gxi


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xii Prefac eeffort in a field where scientifically valid results are impossible and at worst anexercise in astrology an d m ysticism . Why has there bee n such a hostile reception t olong cycles among the established academic disciplines, especially economics? Ithink the answer has to do with a paradigm shift required to take long cycle sseriously . Long cycles require thinking on a new time scale, looking at histor ydifferently, thinking about the connections of economics and politics in new ways .

I first became interested in long cycles because of the fascinating theoretica lquestions raised in the past debates on this topicdebates reviewed in Part One o fthe boo k . Different schools of research have created different theories of long cycles ;notably, Marxists and non -Marxists have seen rea lity through different lenses . As Idug into the long cycle debates, I realized that many of the central theoretica lquestions could not be answered without new empirical research. My empiricalanalyses are reported in Part Two of the book . I have included my data base as aresource for others interested in historical issues of political economy . In so doing, Ihope to encourage others to g ive greater attention to long-term historical processes . Ihave also provided a bibliography of about 670 works referred to in the book . Th ebibliography is a resource for further work in the field, particularly to help thos einterested in long cycles to become fam iliar w ith w orks in a variety of traditions .

My research on long cycles has ben efited from the advice and suggestions of man ypeople . Randall Forsberg shared her thoughts extensively on the relevance of th eproject to security issues . W . Dean Burnham , Manus Midlarsky, and Bruce Russet toffered many constructive ideas after reading e arlier drafts . Others w ho contributedhelpful ideas include Richard Ashley, Francis Beer, Suzanne Berger, Alber tBergesen, Lincoln Bloomfield, Peter Brecke, Christopher Chase-Dunn, NazliChoucri, Lee Farris, Jay Forrester, John Freeman, Avram Goldstein, Dora Gold -stein, Harold Guetzkow, Nancy Hodes, Robert Keohane, Charles Kindleberger ,Joseph Klesner, Edward Kolodziej, Peter LeMieux, Jack Levy, Cathie Martin ,George Modelski, Steve Moss, Robert North, Pierre Noyes, Kate Rooney, AndraRose, Steve Rose nstone, Peter Senge, Drorah Se tel, David Singer, William Stanley ,Sally Zierler, Dina Zinnes, and the editors of the International Studies Quarterly. Ialso benefited from com ments by faculty and students at several universities w here Ipresented parts of this work MIT, Indiana University at Bloomington, Universit yof Illinois at Champaign-Urbana, Boston University, Syracuse University, Univer-sity of California at Los Angeles, University of Southern California, and Yal eUniversity .Travel funds provided by the National Science Foundation, the MIT Departmentof Political Science, and Ha yw ard Alker, Jr ., allow ed me to present papers abo ut m yw ork at three conferences . Computer funds w ere provided by the MIT Department ofPolitical Science. The book is based on work supported under a National Scienc eFoundation Graduate Fellowship. Any opinions, findings, conclusions or recom-mendations expressed herein are m ine and do not necessarily reflect the view s of theN ational Science Foundation .In summarizing theoretical debates I review , condense, and organize man y schol-


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Preface xiiiarly works as I search for the "big picture ." Although I have tried to make the"small pictures" accurate as well, in such a process I have probably misunderstoo dor miscommunicated particular points in certain w orks or categorized others' wo rk i nw ays they might not have done themselves . To any such misrepresented colleagues Iapologize in advance .

gold stein, joshua prosperity and war in the modern age

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