The Long-Term Dynamics of Financial and Technological Styles: How Close a Relationship?

Abstract

This chapter analyses the long-term dynamics of financial and technological styles from both a ‘quantitative’ and a purely ‘qualitative’ perspective. Section 5.2 deals with quantitative aspects. In particular, Section 5.2.1 surveys some empirical implications of the Kondratieff long-wave hypothesis and points out the main methodological problems encountered by previous researchers. Section 5.2.2 addresses the long-term dynamics of, and the relationship between, two time series regarding basic technological innovations and certain important financial innovations between 1691 and 1971. Analysis is conducted of the growth rates, the mean value and the variance in the distribution of both types of innovations during each upswing and downswing phase of different chronologies of Kondratieff long waves.