ABSTRACT
This paper starts by asking the question: is the magnitude of the current economic crisis due to COVID-19 and later by the war alone, or did the pandemic compound an underlying crisis? We use Kontratieff cycles (K-cycles) to study quarantine-related economic losses in context. Capital accumulation is global in its essence, but takes the form of national processes, so for this study we focus on the United States of America. We took the GDP of the US and estimated the implicit price deflator measured in gold prices from 1790 to 2023. For the GDP, we used an exponential adjustment to get a time series without trends. Five K-cycles can be identified in the period, the last of which reached its low point in the 1980s, before rebounding to a peak in 2002. This was followed by a period of contraction that is ongoing at the time of writing. Where are we in the K-cycle? It appeared to have bottomed out in 2012, but stagnation continued, with rises and falls from 2015 onwards, exacerbated by the pandemic. We argue that a new period of economic growth will only arrive with increased labour productivity through the introduction of new technologies, such as robotization and A.I., to the labour process. Despite general hope for a quick economic recovery after most of the world’s population has been vaccinated, recovery from this crisis might take much longer than expected, either because the bottom of the cycle has not been reached yet, or because there will be a period of stagnation or very slow growth.
KEYWORDS: Economic crisis and coronavirus. Economic crisis and Covid 19. Economic cycles. Kondratiev cycles