The global recession of 2009 in a long‐term development perspective

This paper argues that the global recession of 2009 marks the ending of a global development cycle which began in the early 1950s. The long‐wave rhythm of production and prices in the global development cycle is generated by the life cycle of investment and innovation during a technological revolution, related changes in supply and demand for natural resources, and inertia and transformation in the socio‐institutional framework within which development takes place. From this perspective, the global recession is interpreted as a blocked structural transition. Whilst failings in the financial system triggered the global financial crisis, that crisis and the recession are more deeply rooted in contradictions in the global development trajectory. A paradigm shift in development theory and practice is a crucial element of the socio‐institutional transformation now necessary to re‐boot the global development cycle.