Speaking of calculus, apparently a fellow at MIT claims to be able to solve macroeconomics problems using physics. Makes sense to me.
amazon.com
My economics prof told me that Greenspan keeps a book on his desk written by his mentor at Columbia, Measuring Business Cycles by Charles Mitchell and Arthur Burns, who later became Chairman of the Fed.
I was looking at it yesterday, but did not check it out. Essentially, the thesis is that business cycles have different time frames depending on the industry, and have similar spikes and troughs within that industry. A business cycle for the banking industry will be different than one for the steel industry, or the coal industry, or any other industry, but similar to other cycles within that industry. The charts they showed all had the business cycles superimposed, say five business cycles in the steel industry from 1930-1945. The point was to show how they are similar within the industry, but that's no use to me as a historian.
It got me to thinking that maybe what we call recessions and depressions are just coincidences. If one industry is suffering, but others aren't, then things balance out. But since they have different shapes and durations, sometimes they get synchronized, and if they are all synchronized together, watch out.
I could line up all the troughs and peaks all over the world, throughout time, but I couldn't prove that one causes another. Maybe insight from physics would help. |
