Why the development engine broke down (original) (raw)
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International Review of Applied Economics, 2005
In 1992 a blue-ribbon group of US economists led by Michael Porter concluded that the US stock market-based corporate model was misallocating resources and jeopardising US competitiveness. The faster growth of US economy since then and the supposed US lead in the spread of information technology has brought new legitimacy to the stock market and the corporate model, which is being hailed as the universal standard. Two main conclusions of the analysis presented here are: (a) there is no warrant for revising the blue-ribbon group's conclusion; and (b) even US corporations let alone developing country ones would be better off not having stock market valuation as a corporate goal.
of the double bubble at the turn of the Century
2009
This paper argues that the two boom and bust episodes of the turn of the Centurythe Internet mania and crash of 1990s and the easy liquidity boom and bust of 2000s-are two distinct components of a single structural phenomenon. They are essentially the equivalent of 1929 developed in two stages, one centred on technological innovation, the other on financial innovation. Hence, the frequent references to that crash, to the 1930s and to Bretton Woods, are not simple journalistic metaphors for interpreting the "credit crunch" and its solution, but rather the intuitive recognition of a fundamental similarity between those events and the current ones. The paper holds that such major boom and bust episodes are endogenous to the way in which the market economy evolves and assimilates successive technological revolutions. It will discuss why it occurred in two bubbles on this occasion; it examines the differences and continuities between the two episodes and presents an interpretation of their nature and consequences.
Wealth Creation and the Entrepreneurial State: building symbiotic public-private partnerships
The paper argues that building dynamic public-private partnerships that confront the innovation challenges of the future requires rethinking the 'public' part of the partnership away from a pure 'market failure' framework. This involves (1) justifying public policy in terms of market shaping and making (not only 'fixing'); (2) admitting the risks involved in policies that are aimed at affecting not only the rate of growth but also its strategic 'direction' (often providing the investor of first resort) function; (3) socialising both the risks and rewards of the collective value creation process.
2008
Abstract This article focuses on technological discontinuities and late shakeouts in mature industries. The empirical case is combined cycle gas turbine technology in the power generation industry, where two of four main incumbents (GE, ABB, Siemens, and Westinghouse) exited the industry after several years of competition.
Industrial and Corporate Change, 2005
Rolls-Royce plc is currently a powerful competitor in the turbofan engine industry, notwithstanding its own troubled history and the relative lack of international success of British companies in high-technology manufacturing over the past halfcentury. This paper seeks to contribute to the development of a theory of innovative enterprise by analyzing the roles of strategy and finance in sustaining the innovation process at Rolls-Royce over four decades from the mid-1960s. Through an analysis of 'strategic control' and 'financial commitment' as conditions of innovative enterprise at different stages in Rolls-Royce's evolution, we adduce evidence that innovation depends in part on who strategic managers are and how they gain control over financial resources.
Comparative US & Japanese Capitalisms: Broadening the field
In the present paper I will attempt a comparative study of the US and Japanese Socioeconomic reality as it is mirrored in the diverse players of their national economies and international activity. Through the collation of different recent theses about the US and Japanese subsystems of capitalism, this paper brings together two different spheres: sociocultural and economic life. The cohesive substances of the comparison are the dissimilar institutional structures affecting labour market relations, corporate governance systems, technology creation(national innovation systems), strategic choices and political relations. This paper does not serve new illuminating starting points for thinking as it is not reproducing paradigmatic or methodological battles. The purpose of this paper is the resurfacing and resurgence of US-Japan diversity on the above five grounds and the set off of profound institutional causation in the face of the pressing convergent forces of globalization performance models, that end up to simplistic Anglo-Saxon hegemonic panaceas. By equally allowing macro (states, public institutions), meso (industries) and micro(firms, individuals) factors to act as descriptive comparative parameters, this broader scope of analysis will not incorporate a dominant economic actor for each system but will rather shed light to the multiple lines that link institutions and the US-Japan economic interface.
The double bubble at the turn of the century: technological roots and structural implications
Cambridge Journal of Economics, 2009
This paper argues that the two boom and bust episodes of the turn of the century-the internet mania and crash of the 1990s and the easy liquidity boom and bust of the 2000s-are two distinct components of a single structural phenomenon. They are essentially the equivalent of 1929 developed in two stages, one centred on technological innovation, the other on financial innovation. Hence, the frequent references to that crash, to the 1930s and to Bretton Woods, are not simple journalistic metaphors for interpreting the 'credit crunch' and its solution, but rather the intuitive recognition of a fundamental similarity between those events and the current ones. The paper holds that such major boom and bust episodes are endogenous to the way in which the market economy evolves and assimilates successive technological revolutions. It will discuss why it occurred in two bubbles on this occasion; it examines the differences and continuities between the two episodes and presents an interpretation of their nature and consequences.
The Japanese Asset Price Bubble: Evolvement and Consequences
Asset price bubbles and deep financial crises have occurred frequently during the past three decades. It began with the Japanese stock and housing market in the eighties, the technology bubble in stock markets before the millennium, and the housing bubble in the US and other countries, just to name a few. Such a degree of financial instability with extreme economic and social costs is unusual in economic history. To be able to find measures and their optimal timing to protect against these events a deeper understanding of the causes, evolvement and consequences of asset price bubbles is needed. The aim of this paper is to contribute to an improvement of that understanding by analyzing the historical case of the Japanese asset price bubble on the housing and stock market. The added value of such an analysis may come from the availability of today´s research, experiences and econometric techniques.
Competitiveness and future outlooks of the Estonian economy: R&D and innovation policy review 2002
2003
A cyclist from Tarvastu with his "own factory" bicycle. 1912. Photo: Johannes Pääsuke. A cyclist from Tarvastu with his "own factory" bicycle. 1912. Photo: Johannes Pääsuke. during which this report was reviewed and commented upon in detail. We are extremely grateful for all the comments and critique. Cover photo: Johannes Pääsuke Layout: Emajõe Disain Printing: Triip Printed on 100% recycled paper Cyclus Offset with inks based on natural resins and oils. Secretariat of the Research and Development Council State Chancellery Tallinn 2003 ISBN 9949-10-176-X -signifi cantly raising the effectiveness of educational system, investments into education, skill conversion and retraining on all levels. 8 The starting point for the following analysis is the economic indicators which are listed as important factors at driving the economic development by the majority of modern economic theory approaches: neo-classical Solow-Swan model, models of endogenous and evolutionary economic growth. See, for example, Robert M. Solow "A Contribution to the Theory of