The Future of Economic Growth

The Future of Economic Growth

As New Becomes Old

The Cournot Centre series

Robert Boyer

In this book, Robert Boyer follows the origins, course and collapse of the ‘new economy’ and proposes a new interpretation of US dynamism during the 1990s. He argues that the diffusion of information and communication technologies is only part of a story that also requires understanding of the transformation of the financial system, the reorganization of the management of firms and the emergence of a new policy mix. The book includes a long-term retrospective analysis of technological innovation, and an international comparison of OECD countries delivers an unconventional and critical assessment of the hope and the hype of the ‘new economy’.

Chapter 4: Genealogy of the ‘New Economy’: The Institutional Change at the Heart of the US Trajectory

Robert Boyer

Subjects: economics and finance, industrial organisation

Extract

INTRODUCTION It must be remembered that the United States was the first country to have explored a growth regime based on mass production that both enhanced mass consumption and synchronized with it (Aglietta, 1976). Not surprisingly, it was also the first to have experienced, from the mid-1960s onwards, a deceleration in overall productivity. This phenomenon has been widely analysed, but still remains somewhat mysterious (Federal Reserve Bank of Boston, 1980). This turnaround marks the growth regime’s entrance into a period of crisis (Weisskopf et al., 1983; Boyer and Juillard, 1992). To overcome the hurdles encountered, a variety of different strategies were deployed. It would be methodologically sound to review these strategies in order to ascertain the reasons why they did not produce the expected regime. Predictions of an ICT-driven growth regime should be questioned – the US economy during the early years of the twenty-first century is not the same as it was in the 1970s. At least seven major structural transformations have taken place, each potentially influencing the growth regime that emerged during the 1990s. One conclusion that can be drawn from all of this is that the role of technological determinism needs qualification. 1973–2000: THE LONG SEARCH FOR SUCCESSORS TO THE FORDIST GROWTH REGIME As a number of research studies have shown (Aglietta, 1976; Boyer and Juillard, 1992, 1995), the origins of the imbalances in the US economy date back to the late 1960s. Despite dynamism in investment, productivity slowed and income distribution-related tensions materialized in the form...

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