As New Becomes Old
- The Cournot Centre series
Chapter 1: A Social Construct and an Analytical Challenge
1. A social construct and an analytical challenge INTRODUCTION All concepts, particularly within the field of economics, have a genesis and a history. This is because they result from intellectual and social constructs. The ‘new economy’ does not escape this rule. It is therefore appropriate to spend a little time remembering why it is that this term first arose during the latter half of the 1990s. At the beginning when there was general enthusiasm for the ‘new economy’ (and not only in financial or ICT circles), we find a conjunction of three factors that played a crucial role in spreading the idea that the US economy entered a new phase during the mid-1990s. Note that most of this action transpired in the United States, which therefore became a mandatory point of reference for analysis, with other countries subsequently being compared and benchmarked in reference to the dynamism observed here. This was no coincidence. The US economy had been the first to explore previous growth regimes and to undergo ‘the crisis of Fordism’. As such, it is worth retracing the circumstances and factors that enabled the birth and subsequent diffusion of the belief that an unprecedented growth regime emerged between 1995 and 1997. THE AMERICAN ECONOMY IN THE 1990s WAS NO LONGER THE SAME AS THAT IN THE 1960s From the early 1970s to the mid-1990s US growth was marked by a break with the Fordist era when, thanks to institutionalized compromises inherited from the New Deal and especially from the...
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