To your experience, what other waves are affected by or affect the innovation cycle?
There are so many theories about the different waves, the political waves and the other, you know... It's not easy. There is one question that people ask me all the time, which is what's the difference between the Kondratieff waves and your waves, which I call 'great surges of development', they're not long waves. And the reason why I changed the name is because the Kondratieff waves and what Schumpeter called long waves were about, as they said, 20-30 years of upswing, of growth, and 20-30 years of recession. Now I found that that was not true. It couldn't be proven statistically, and what it did was to say, for instance, thinks like 1920s would be upswing and the 1930s would be downswing, whereas what I found was that the 1930s was only like a parenthesis between the mass production products and growth and everything of the ‘20s and that which happened after the war and during the war, because the war was actually a time of mass producing things, and then the ‘50s and ‘60s when you had the same thing as in the ‘20s but more and more intensely, and etcetera. So I said, this is, there's something wrong in here.
And as I did more and more research, I looked at history, and in history what you got was two different prosperities divided by a crash and a recessionary period. So you've got the bubble prosperity type, which is a gilded prosperity, where you have income pluralization, where the rich get richer and the poor get poorer, and then you have to reverse this problem afterwards, and then the golden age, where you get better distribution of income, better distribution of demand, and synergistic growth across the board, across all industries, whereas in the bubble prosperity you seem to concentrate in the new industries only and then in modernizing the old, but not necessarily innovating in every industry, which is what you get in a golden age. So that is very different. So for me, upswing and downswing doesn't really make much sense. For me, even though I do accept that Schumpeter and Kondratieff pointed out something that's so important. Kondratieff talked about how innovation is what drives growth, and that I absolutely believe, and that's precisely why my great surges are about how technological revolutions diffuse across society, how they're assimilated, why they at first have so much resistance, and then you have to force paradigm diffusion, force the technological diffusion, have it with free markets so that you can find out which ones are going to win and so on and then why you have to guide it the second time. So for me the centre of attention is not growth, the centre of attention is technological diffusion itself, and social assimilation of the technological diffusion.
So Schumpeter gave me the lead but then I had to break off. And Kondratieff gave the lead to Schumpeter, because Kondratieff pointed out that there weren't just short cycles every time there was a crisis, but also medium cycles, but especially, I mean, Kondratieff had seen the short and the medium cycles, sorry, Schumpeter had seen the short and the medium cycles, Kondratieff added the long cycle, and Schumpeter spent a long time trying to improve the relationship between them, you have two huge volumes of business cycles, talking about all those. Many, many of the things he says there are extremely useful, but the long cycle thing, the long wave thing or the long cycle thing I think for me makes more sense looking at the diffusion of technologies. So that's why I've changed the name to great surges of development. And I do talk about technological revolutions just as he does.