Immanuel Wallerstein (1930-2019)

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Photo: Brennan Cavanaugh

Immanuel Maurice Wallerstein, historical social scientist, anti-colonial militant, world systems theorist, intellectual provocateur and polymath, has passed – and with him has passed the last giant of the golden age of anti-Eurocentric history. Wallerstein was born in 1930, educated at Columbia, from where he successively received BA, MA, and PhD degrees by 1959. From his early adulthood, he was seasoned and beguiled by national liberation struggles, reading the texts of Nehru and Gandhi, attending youth congresses alongside participants from African countries in the heat of anti-colonial militance. His earliest works focused on colonial and post-colonial African governments, including a number of neglected monographs and co-authored document collections on the African liberation movements.Read More »

The Green New Deal: Whither Capitalism?

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By Güney Işıkara and Ying Chen

The Green New Deal resolution by Alexandria Ocasio-Cortez and Ed Markey sparked an immense amount of discussion on all layers of political discourse, national and international. The way Ocasio-Cortez, Sanders and many others phrase the problem in the broader context of social, economic, and environmental grievances caused by capitalism is crucial for setting the terms of debate and struggle. This opens up space the left can use to address such issues in a systematic way rather than being content with symptomal healing. In fact, countless contributions have already been made on theoretical and tactical grounds. In this piece, we build on those contributions, and unpack the dynamics inherent to the capitalist system that would need to be addressed in the ongoing discussions. We also shed light on the limitations of a market-based and growth-centered approach to tackling climate destabilization, while offering other domains of political intervention such as property relations and demarketization of subsistence.Read More »

Revisiting the Battles and Cycles of Development

Cycles.jpegWalt Rostow (1959) infamously put forth a five-stage theory of economic development, extrapolating from the experiences of the great industrialized nations. However, as dependency theories strongly pointed out, the conditions under which those countries industrialized is significantly different from those that prevailed after decolonization. In addition to this, democratic capitalism experiences turbulence, which I argue makes development under this global system a struggle against powers and against what I call “Burawoyan Cycles”.Read More »

Secular Stagnation: Short-term Fixes for Long-term Problems

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The concept of secular stagnation, first propounded by Alvin Hansen in the 1930s, has enjoyed an academic – and mainstream – resurrection thanks to Lawrence Summers (2014, 2016), who first advanced the theory as an explanation for the subdued recovery and anaemic growth prospects of advanced economies. A surprising criticism recently came from Joseph Stiglitz (August, 2018), who believes that the theory offers a convenient escape away from assuming responsibility for failed policy during the crisis.  An acrimonious debate between Summers and Stiglitz followed.  

On the face of it, Summers – and Gauti Eggertson – are right: the modern theory of secular stagnation does see a central and substantial role for fiscal policy. The problem, however, lies in the fact that a short-term fix for aggregate demand shortfalls – fiscal policy – is being advanced as a long-term solution of the problem of reduced growth prospects. The central question of what drives investment in a capitalist economy is not addressed.Read More »

Keynes or New-Keynesian: Why Not Teach Both?

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For economists, the Great Recession, the worst crisis the world economy has seen since the Great Depression of the 1930s, has highlighted the need for plurality in macroeconomics education. Ironically, however, there is a move towards greater insularity from alternative or contrasting points of view. Where as, what is required for vibrant policy making is an open-minded academic engagement between contesting viewpoints. In fact, there does not even exist a textbook which contrasts these contesting ideas in a tractable manner. This blog post is as an attempt to provide certain pointers towards developing macroeconomics in a unified framework.

Macroeconomics as a subject proper came into existence with the writings of John Maynard Keynes[i]. There were debates during his time about how to characterise a capitalist economy, most of which are still a part of the discussion among economists. Keynes argued that capitalism is a fundamentally unstable system so the state needs to intervene to control this instability.Read More »

Unanswered Questions on Financialisation in Developing Economies

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The discussions of the processes behind the growing importance of finance, financial transactions and financial motives, as well as the sustainability of the financial systems, have been located in the critical political economy debate of financialisation and neoliberalism (Crotty, 2003; Epstein, 2005; Fine, 2013; Lapavitsas, 2013; Palley, 2016; Sawyer, 2013; Stockhammer, 2004).

The analysis of financialisation in developing and emerging economies (DEEs) is relatively novel (Bonizzi, 2013). It is rooted in earlier discussions about the risks of financial globalisation and liberalisation (Akyuz & Boratav, 2005; Barbosa-Filho, 2005; Crotty & Lee, 2005; Frenkel & Rapetti, 2009; Grabel, 2003; O’Connell, 2005; Palma, 1998; Taylor, 1998), including the Latin American Structuralist literature on the hegemonic role of the US dollar and its financial and monetary implications for DEEs (Belluzzo, 1997; Braga, 1997; Fiori, 1997; Miranda, 1997; Tavares, 1997); the debate on capital account liberalisation and capital market integration (Cohen, 1996; Rodrik, 1998; Stiglitz & Ocampo, 2008; Strange, 1994); and the Minsky-inspired currency and boom bust dynamics of financial crisis in developing economies (Arestis & Glickman, 2002; de Paula & Alves, 2000; Dymski, 1999; Kregel, 1998; Schroeder, 2002).Read More »

Market Forecasting: A Sensitive Practice at the Heart of Neoliberal Capitalism

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This article was originally posted on The Economic Sociology and Political Economy community blog.

Since the emergence of modern financial markets, financial analysts have played a critical role in producing visions of “the economy” and its future development. As experts, they analyze market developments and predict future scenarios that enable other financial market participants to speculate on the rise or fall of stock prices, the success or failure of particular investment products, and the growth or decline of entire national economies. The substance of the analysts’ valuation and forecasting practices is, however, heavily disputed among economists. In neoclassical economic theory, the assumption that markets are informationally efficient has challenged the legitimacy of the work of financial analysts since the establishment of the efficient market hypothesis as a central paradigm in the mid 1960s. Alternative schools of thoughts – such as new institutional or behavioral economics – have criticized this paradigm. However, they have also argued that the degree of uncertainty, which is inherent to financial markets, makes prediction impossible.Read More »

Consuming development: Capitalism, economic growth and everyday life

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With the consumption patterns in rich countries being more unsustainable than ever and the consumption of the ‘emerging middle classes’ increasing rapidly, it is about time ‘consumption and development’ becomes a field of study. Such a field would necessarily be interdisciplinary and combine analyses of everyday life and the structures of capitalist development. A useful starting point could be found at the intersection of theories of practice and systems of provision.Read More »