The Dynamics of Bubbles and Golden Ages
Chapter 12: Synergy: Supporting the Expansion of the Paradigm Across the Productive Structure
Synergy: Supporting the Expansion of the Paradigm 127 12. Synergy: Supporting the Expansion of the Paradigm across the Productive Structure Whatever time it takes to set up the framework to overcome the recession, the beginning of Deployment is usually characterized by synergistic growth, extension of markets and increasing employment. The atmosphere is likely to be quite different from that which prevailed during the casino economy, because real growth in production becomes the basic source of wealth. The confident optimism of company expansion replaces the arrogant self-complacency of cunning speculation. It is perhaps the only period when aggregate statistics are consistent for safe extrapolation and the ceteris paribus assumptions of much economic theory become plausible. Growth is generally seen as firmly rooted in real production and the relative values of money across the various sectors of the economy stabilize and seem understandable to most people. In that context, rules are accepted as ultimately beneficial for all. Regarding the relationship between financial and production capital, it has often been mentioned above that the synergy phases in two major historical cases, the third and fourth surges, were quite different in the United States. In both there was a return to the primacy of the real economy, in the sense that the direct control of production, infrastructure and services became the main driver of the accumulation of wealth, rather than the indirect hands-off ownership of securities, rent-producing assets or financial instruments. But, in the ‘Progressive Era’ the financiers or their direct agents sat on...
You are not authenticated to view the full text of this chapter or article.