Volatility and crisis in catching up economies: industrial path-through under the stickiness of technological capabilities “The Red Queen Effect” . . Mario Cimoli (CEPAL) Gabriel Porcile (UFPR). The questions 1.
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Volatility and crisis in catching up economies: industrial path-through under the stickiness of technological capabilities“The Red Queen Effect”.
Mario Cimoli (CEPAL)
Gabriel Porcile (UFPR)
“Ponzi finance” plus “liquidity trap”
“There therefore are systemic conditions that need to be satisfied for a financial crisis to occur: the financial structure needs to be heavily indebted, involving a large element of either Ponzi finance or speculative finance which can become Ponzi. We can characterize a financial structure which is predominantly hedge financing as robust and a financial structure that is heavily speculative and Ponzi as fragile.” (Minsky, 1991)
“The potential loss to society from a financial crisis will be great if it leads into a deep and long depression. If all that followed from a financial crisis is some redistribution of the wealth or a shift of production from investment to consumption economy, then some concerns goods within a full employment about equity and the impact upon the losers in this process may arise…Intervention is ordained if it is believed that a free market resolution of a financial crisis requires doing time in a deep depression.” (Minsky, 1991)
1) It is more than an aggregate impact (it affects the recomposition of the microeconomic structure).
2) Firms and sector readapt learning, capabilities and production
3) Destruction of production capacities and technological capabilities
4) Industrial and technological systems are no less systemic than the finance
5) From a positive shock to long term loses in productivity and growth…of LA?
7) Competing policies and the need “more than ever” of active industrial and technological polices.
8) Policies to avoid the destruction of production capacities and technological capabilities; and, furthermore, incentive the accumulation and adoption of new technologies
9) A process of technology foresight to have a comprehensive overview of future productive paradigms bringing together in partnership scientists, engineers, industrialists and government officials