Macrohistory and Globalization

LOMONOSOV MOSCOW STATE UNIVERSITY Faculty of Global Processes RUSSIAN ACADEMY OF SCIENCES
INSTITUTE OF ORIENTAL STUDIES
The Eurasian Center for Big History and System Forecasting VOLGOGRAD CENTER FOR SOCIAL RESEARCH
Leonid Grinin
MACROHISTORY AND GLOBALIZATION
Uchitel Publishing House Volgograd 2011
87.6 63.3
Leonid Grinin. Macrohistory and Globalization / Edited by Ilya Ilyin. Volgograd: Uchitel Publishing House, 2011. 320 pp.
The present monograph considers some macrohistorical trends along with the aspects of globalization. Macrohistory is history on the large scale that tells the story of the entire world or of some major dimensions of historical process. For the present study three aspects of macrohistory have been chosen. These are technological and political aspects, as well as the one of historical personality. Taken together they give a definite picture of unfolding historical process which is described from the beginning of human society formation to the present day and near future. The combination in the monograph title of the two terms macrohistory and globalization is in no way artificial. On the contrary, the connection of these terms is organic at least as the real goal of macrohistory is to find meaning in the past so as to create new possibilities of meaning for the future. The analysis of globalization also includes three aspects: political, economic and futurological as today the world may well be regarded as being at the start of a new global reconfiguration. The author presents his ideas of the world prospective political and in some respects social-economic development basing on the analysis of macrohistory and contemporary globalization processes. The monograph also considers some global scenarios of the World System's near future.
Uchitel Publishing House 143 Kirova St., 400079 Volgograd, Russia ISBN 978-5-7057-3007-0 Volgograd 2011 Uchitel Publishing House, 2011
Contents
Introduction
. . . . . . . . . . . . . . . . . . . . . . . .
Part I. MACROHISTORY SURVEYS Chapter 1 Production Revolutions and Periodization of History: A Comparative and Theoretic-Mathematical Approach . . . . . . . . . . . . . . . . . . . The Role of an Individual in History: A Reconsideration . . . . . . . . . The Evolution of Statehood .
15 46 83
Chapter 2 Chapter 3
. . . . . . .
. . . . . . . . . . .
Part II. GLOBALIZATION: ECONOMIC AND POLITICAL ASPECTS Chapter 4 Section 1. Section 2. Chapter 5 Section 1. Section 2. Economic Aspects of Globalization
(in co-authorship with Andrey Korotayev) . . . . . . . .
136
The Theory of Economic Cycles and Current Global Crisis . . . . . . . . . . . . . . . . . . . . . 136 The Global Financial System: Pros and Cons Political Aspects of Globalization
. . . . .
185 207
. . . . . . . . .
Why do States Lose their Sovereignty in the Age of Globalization? . . . . . . . . . . . . . . . . On the Way to Global Society: The Coming Epoch of New Coalitions . . . . . . . . . . . . . . .
(in co-authorship with Andrey Korotayev)
207 231 259 316
References . . . . . . . Complete Table of Contents
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Introduction
Social phenomena and processes can be analyzed in various ways among which the method of studying certain dimensions of social reality is hardly the leading one. This is especially the case when one deals with long historical periods. In the present monograph this particular method is applied (of course, alongside with many others). Here some macrohistorical trends as well as the aspects of globalization are considered in tight interrelation. Macrohistory is history on the large scale, sometimes telling the story of whole civilizations, sometimes of the entire world (Reilly 1999), but sometimes of particular dimensions of historical process. For the present study we choose three aspects of macrohistory, namely, technological and political aspects, as well as the one of historical personality. Taken together they give a definite picture of unfolding macrohistorical processes from the beginning of formation of human society to the near future. They also show the scales and circumstances when certain driving forces of history come to the foreground. The technological aspect analyzed in Chapter 1 demonstrates the most important stages of production forces' development and the greatest production and technological revolutions that took place in history. On this large scale it becomes especially evident that, using Fernand Braudel's words (1993: 67), in reality, everything rested upon the very broad back of material life; when material life expanded, everything moved ahead. That is why the distinguishing of the greatest productive/technological revolutions also allows setting a periodization of historical process in general. However, a relevant dominance of technology can be recognized only within very large time spans and strict limits. Chapter 2 which analyzes the historical personality's aspect of macrohistory aims at demonstrating that any analysis of history is unthinkable without consideration of the role of the Great men and other historical persons capable to change substantially the course of events in certain circumstances. Although it has become quite a common idea that it is just people who make history, nevertheless the interest to the individual's opportunities and ways to influence the choice of historical alternatives
Leonid Grinin. Macrohistory and Globalization
significantly decreased. In our opinion, this is unjustified and wrongful especially in the present period when the scale of influence of different agents empowered with certain opportunities greatly increases. Chapter 3 considers the development of the political constituent of macrohistory. It goes without saying that the state is the most important organization created by people. Within the state the whole great historical experience is accumulated, the state is an integral institution allowing an estimation of any developmental aspect: from economic to ethnical, from demographic to cultural. The analysis of state formation and its evolutionary stages is all the more important as in the age of globalization one observes certain symptoms of the statehood decay (which is discussed in Chapter 5). The second part of the monograph is dedicated to the process of globalization. It consists of just two chapters. But still it covers three aspects: political, economic and futurological. Actually it is very important not only to consider the present situation but also to look into the future (although at the risk of making a mistake). We present our idea of the world prospective political and in some respects social-economic development basing on the analysis of macrohistory and contemporary globalization processes. In Chapter 1 of the monograph we also give a forecast of the productive forces development in the nearest decades. The combination in the title of the monograph of the two terms macrohistory and globalization is in no way artificial. On the contrary, the connection of these terms is organic at least as the real goal of macrohistory is to find meaning in the past so as to create new possibilities of meaning for the future (Galtung and Inayatullah 1997). It is worth dwelling on the value of combining in one book the large-scale historical or macrohistorical processes with globalization trends. First of all, it is important to show the way the transition to modern processes has taken place. To reveal such a link was one of the monograph's goals. In particular, we have tried to show the way the weak archaic state transformed first into the centralized developed state, then into the mature industrial one and after that how it changed into the mature social state. And further we demonstrate why having reached its golden age, in the situation of economic globalization the state as an institute undergoes a significant transformation and loses its sovereignty. No less important is the analysis of the emergence of industrial productive forces. And further, why this led to the appearance of the cyclic devel-
Introduction
opment of economy (medium-term business cycles), to the emergence of recurrent economic crises. Finally, to what extent does the modern global crisis resemble or differ from previous crises? Today it is clear that it is very productive to search for the origins of globalization in the depths of history. It is no coincidence at all that the growing interest in globalization has promoted interest in the trend often denoted as historical dimension of globalization. Among such movements it is most worth noting Global History whose heart and novelty, according to Bruce Mazlish and Akira Iriye (Mazlish, Iriye 2005: 19), is history of globalization. We contend that in a certain sense almost the whole World History can be regarded as a history of movement toward the increasing size of social systems, their integration, and globalization in general. Hereby, in history and sociology the investigation is broadening with respect to the historical development of globalization processes (see Grinin 2011b, 2011c; Grinin, Korotayev 2009a, 2009b). As is known, there is quite a heated debate on the question when globalization started. Whether it has been going on since the 3rd millennium BC (when according to Andre Gunder Frank the World System emerged [Frank 1990, 1993; Frank, Gills 1993]), or during the so-called Axial Age (Jaspers 1953) in the 1st millennium BC, or only from the Great Geographical Discoveries, or in the 19th century, or after the year 1945, or only in the late 1980s. Each of these dates has its own sense. It is quite reasonable to discuss the problem in the context of whether one can speak about globalization (basing on the semantics of the term global itself) before the start of the Great Geographical Discoveries, as a result of which the idea of the Earth as a globe exceeded the limits of the opinion of a group of scientists and became practical knowledge (Chumakov 2009). But, notwithstanding this point of view, there is no doubt that historical dimension of globalization is quite challenging (for more detail see Grinin 2011f). And that is why the search for new aspects of organic link between macrohistorical trends and contemporary globalization processes is both necessary and potentially fruitful.1
The correlation between macrohistory and globalization allows also a better understanding of the relationship between globalization as a set of contemporary complex processes and global studies (globalistics) as a branch of knowledge about global phenomena and processes (see, e.g., Ilyin 2009).
In connection with already mentioned Global History which gains in popularity, it is worth mentioning that, on the one hand, macrohistory is tightly connected with it by the scale as well as by the absence of reference to certain national histories and in the contemporary context by tight association with globalization. From this point Global History serves as a peculiar variant of macrohistory since Global History goes back to the works of classics of macrohistory and World System approach of the second half of the 20th century: Braudel, Wallerstein, Arrighi and others. But on the other hand, macrohistory is a certain conceptualization of historical process. In this respect it is close rather to the theory of history than to Global History.2 The latter more often presents an attempt of a broad historical investigation, although often based on more or less clear theory, but, on the whole, Global History is a meta-narrative capable to meet the demands of the globalizing world (O'Brien 2006: 3; see also Berg 2008; Crossley 2008). *** All the ideas presented in the monograph have already been expressed in a number of the author's articles. These articles when revised into chapters have obtained inner integrity and cohesion. As has been already said the monograph consists of two parts. Part I Macrohistory Surveys consists of three chapters. Chapter 1 Production Revolutions and Periodization of History: A Comparative and Theoretic-Mathematical Approach regards the major qualitative stages of development of the world productive forces. For the reason of detection of such stages and the most successful analysis of them we have proposed the term the production principle. We single out four production principles: 1. Hunter-Gatherer; 2. Craft-Agrarian; 3. Industrial; 4. Information-Scientific. The change in production principles is connected with the three greatest technological breakthroughs,
2
On the relation between macrohistory and theory of history see, for example, Galtung and Inayatullah 1997; Reilly 1999; Little 1998, 2000a, 2000b. However, it is already evident from the recommended reference list on macrohistory that includes in particular Shapes of Philosophical History by Frank E. Manuel (1965); The Shapes of Time by Peter Munz (1977); The Rise of the West: A History of the Human Community by William H. McNeill (1963); The Great Divergence: China, Europe, and the Making of the Modern World Economy by Kenneth Pomeranz (2000); The Sources of Social Power by Michael Mann (1986, 1993); Civilization and Capitalism, 15th 18th Century, Vols IIII by Fernand Braudel (1982); ReORIENT: Global Economy in the Asian Age by Andre Gunder Frank (1998); The European Miracle: Environments, Economies and Geopolitics in the History of Europe and Asia by E. L. Jones (1981) etc.
Introduction
which are denoted as production revolutions: the Agrarian (or the Neolithic), the Industrial and the Information-Scientific ones. The idea of production revolutions has been discussed for quite a long time, however, without being conceptualized. In the chapter we have developed a theory of production revolution. On the base of the theory of production revolution and production principles we suggest a model of periodization of historical process. The starting point of the production revolutions can be regarded as a convenient and natural point from which the chronology of formation change can be established. Thus, Chapter 1 is devoted to the historical process as a whole, considered with respect to its periodization which allows revealing its structure. We also demonstrate some possibilities of mathematical modeling for the problems concerning the periodization of the world historical process. In this chapter we also propose a number of forecasts relating to the forthcoming decades including the start and development of the second phase of the Information-Scientific Revolution. Chapter 2 The Role of Individual in History is devoted to the significant at all times and sounding anew in every epoch problem of the role of an individual (also a Hero, Great Man, agent/agency) in history. The issue of the role of an individual in history is among the most important within the framework of philosophy and theory of history. It is argued that in the age of globalization, when the humankind has found itself at a new developmental turning point there is an urgent necessity to return to the analysis of this issue. In the first section the retrospective analysis of views on this problem from the antiquity to contemporary counterfactual history is considered. In the second section the author aims at the analysis of the set of factors affecting the role of individuals as a conceptual system. We suggest that depending on various conditions and circumstances and with the account of specific features of historical place and time and personal characteristics, the historical role of an individual may fluctuate from the absolutely invisible up to the greatest one. A conclusion is made that the weaker and less stable is a society, the more destroyed are the old structures, the greater may be the personality's impact. In other words, the role of an agent is inversely correlated with society's stability and strength. The chapter presents the model which takes into account four phases of a society's evolutionary dynamics: 1) stable society of the monarchic/dictatorial type; 2) social pre-revolutionary crisis; 3) revolution; 4) creation of a new order. It is shown that a personality's greatest influ-
10
ence is observed at the third and fourth stages, while at the first stage the influence is usually considerably weaker. Chapter 3 The Evolution of Statehood considers the political dimension of the historical process. The power emerges together with human society. However, the political power was institutionalized within human societies much later. In the hunter-gatherer societies this institutionalization was still absent. Only with the emergence of agriculture and large demographic shifts following the agrarian revolution there appeared the conditions for the emergence of more or less separate political sub-systems. During the very prolonged late archaic and early civilization periods one could observe the separation of political sphere from society including the beginning of specialization in the field of political management which in fact can be considered as the origin of politogenesis. The first medium complexity polities (chiefdoms and their analogues) emerged. The transition to statehood appears to be one of the most crucial changes in the human historical development. There are many uncertainties concerning the state despite the seemingly high degree of knowledge about this institution. Scientists are at variance on how and when it emerged, on the criteria that distinguish it from prestate and non-state formations. The chapter presents a new approach to the causes and models of the emergence of the state. The matter is that within the politogenesis process in addition to the state formation one could also observe the formation of polities which were comparable with the early state in their complexity level and the fulfilled functions, but still lacked a number of early states attributes. We denote such polities as early state analogues. In this chapter we also consider conditions of formation of early states and their analogues in connection with the polities' size, their ecological and social environment. The view of evolution as a multilinear process provides a clue to the understanding of the evolutionary stages passed by the state. The chapter presents the general evolutionary scheme of statehood and new models of state's evolution. Instead of a two-stage model by Claessen and Skalnk early state mature state (1978d, 1981) which ignores the principal differences between the states of pre-industrial and industrial epochs, we propose a three-stage model of the evolution of state: early state developed state mature state. Yet, not all the early states but only a small part of them were able to transform into developed ones; far from all the developed states managed to transform into mature ones.
Introduction
11
Early states are insufficiently centralized states with underdeveloped bureaucracy, their flourishing took place in the period of Ancient World history and the most part of the Middle Ages. The developed states are centralized estate-corporative and bureaucratic states of the Late Antiquity, Middle Ages and Early Modern Age. The mature states are the states of the industrial epoch with rational type of law and government where the classes of industrial society and modern type of nation have formed. However, when in the 1950s and 1960s the USA and a number of European countries became to transform into welfare states/mass consumption societies; this means the process of changing of the mature class state into the mature social state. Later, when in the 1980s and 1990s globalization became much stronger, the mature social state began to develop into something different. However into what? This will be discussed in Chapter 5. Part II Globalization: Economic and Political Aspects consists of two chapters (4 and 5) analyzing the economic and political dimensions of globalization respectively. Chapter 4 Economic Aspects of Globalization3 discusses modern industrial economy which from the moment of its emergence in the 19th century and till the present days is exposed to cyclicity not only at the scale of a separate society but also at the level of global economy as a whole. The latter leads to the unevenness of development and heavy recessions. In this chapter we provide a detailed qualitative description of macroeconomic dynamics at every phase of the economic cycle; we specify the driving forces of cyclical dynamics and causes of transition from one phase to another (including psychological causes); a particular attention is paid to the turning point from the peak of overheating to the acute crisis, as well as to the turning point from the downswing to recovery. Chapter 4 is divided in two sections: The Theory of Economic Cycles and Current Global Crisis and The Global Financial System: Pros and Cons. The first section of Chapter 4 presents an analysis and verbal model of medium-term business cycles (with a characteristic period of 7 11 years) known as Juglar cycles. The model takes into account a number of approaches to the analysis of such cycles; in the meantime it also
3
The chapter has been written in cooperation with Andrey Korotayev.
12
takes into account some of the authors' own generalizations and additions that are important for understanding the internal logic of the cycle, its variability and its peculiarities in the present-time conditions. The authors argue that the most important cause of cyclical crises stems from strong structural disproportions that develop during economic booms. These are not only disproportions between different economic sectors, but also disproportions between different societal subsystems; at present these are also disproportions within the World System as a whole. We suggest that the current crisis turns out to be rather similar to classical Juglar crises; however, there is also a significant difference, as the current crisis occurs at a truly global level. Yet, due to this truly global scale of the current crisis, the possibilities of regulation with the national state's measures have turned out to be ineffective, whereas the suprastate regulation of financial processes hardly exists. It is shown that all that has led to the reproduction of the current crisis following the classical Juglar scenario. The second section of Chapter 4 analyzes the global causes of the contemporary crisis and the possibilities to eliminate the most acute problems that have generated this crisis. It analyzes both the negative role of the world financial flows and their important positive functions including the insurance of social guaranties on the global scale. On the one hand, anarchic and extremely rapid development of new financial centers and financial flows contributed to the outbreak of the global financial-economic crisis. The latter was amplified by the nontransparency of many financial instruments, which led to the actual concealment of risks and their global underestimation. On the other hand, new financial technologies decrease risks in a rather effective way, they expand possibilities to attract and accumulate enormous capitals, actors, and markets. The modern financial sector also contributes to the provision of insurance for social funds at the global scale. The participation of pension and insurance funds in financial operations leads to the globalization of social sphere. Countries poor in capital, but with large cohorts of young population, are involved more and more in a very important (though not quite apparent) process of supporting the elderly portion of the population in the West through the vigorous unification of the world's financial flows, their standardization, and by their increasing global mobility and anonymity. Chapter 5 Political Aspects of Globalization is also divided in two sections. In the first Why do States Lose their Sovereignty in the Age
Introduction
13
of Globalization? we discuss an interesting problem tightly connected with the globalization issue: why states lose their sovereignty and why they voluntary renounce their sovereign prerogatives. The process of globalization undoubtedly contributes to the change and reduction of the scope of state sovereign powers. Much has been said about the ways globalization strengthens the factors that objectively weaken the countries' sovereignty. The list of threats to state sovereignty often includes global financial flows, multinational corporations, global media empires, the Internet etc. and, of course, international interventions, as we have recently seen in Libya. At the same time (note that this point is debated surprisingly little and occasionally), since the end of World War II, increasingly more states have been willingly and consciously limiting their sovereign rights, including the rights: to determine the size of taxes and duties, to emit money, the right of supreme jurisdiction, the right to use capital punishment, to proclaim certain political freedoms or to limit them, to establish fundamental election rules etc. So there is no doubt that today the completely free and independent countries' sovereignty has become much smaller. And what is extremely important, many countries quite often give away a part of their sovereign powers voluntarily indeed. In our opinion, the factor of voluntariness in reducing one's own authority is, no doubt, the most important one in understanding the future of the state. What stands behind voluntary self-limitation of sovereignty prerogatives? There are several reasons for such voluntariness and altruism, including the fact that such a restriction becomes profitable, as in return the countries expect to gain quite real advantages especially as members of regional and interregional unions. Besides, the world public opinion must be pointed out as an important cause of sovereignty reduction: the wider is the circle of countries voluntarily limiting their sovereignty the more inferior appear those states, which do not make such restrictions. However, it is worth noting that the voluntary reduction of sovereignty is more characteristic of Western countries. The transformation of sovereignty in countries with different cultural traditions proceeds with more difficulty and also is closely connected with the level of economic development. Nevertheless, the transformation of sovereignty proceeds in this or that way almost in all countries. The second section On the Way to Global Society: The Coming Epoch of New Coalitions is devoted to the analysis of probable future
14
transformations in relation to the crisis and to the estimation of socioeconomic and political advance of the world within the forthcoming decades. In this section within the framework of the analyses of the future development of the World System we attempt to answer the following questions: What are the implications of the economic weakening of the USA as the World System center? Will the future World System have a leader? Will it experience a global governance deficit? Will the world fragmentation increase? We analyze some crucial events of the present, which could be regarded as precursors of forthcoming fundamental changes. In particular, it is shown that the turbulent events of late 2010 and 2011 in the Arab World may well be regarded as a start of the global reconfiguration. We consider some global scenarios of the World System's near future. During the struggle for a place in organizing and operating the new world order, an epoch of new coalitions will come, which will outline the contours of a new political landscape for a considerably long period. These will be such changes that could prepare the world to the transition to a new phase of globalization (it will be a great success if this is the phase of sustainable globalization) whose contours are not clear yet. In the section the conclusion is made that although the national state will remain the leading player in the world scene for a long time, we suppose that in the long term the tendency to transform national sovereignty will grow. Of course, this is not a one-side tendency. For instance, the current world crisis shows that a renaissance of the state's role is quite probable in the near future. We are on the eve of a very complex, contradictory, and long process of the formation of a new world order; the state will not disappear within it, but its features and functions will change significantly. Acknowledgments The author would like to express his deep gratitude to Elena Emanova and Kseniya Biryukova for their irreplaceable assistance in the process of preparation of this monograph.
Part I MACROHISTORY SURVEYS

Chapter 1 Production Revolutions and Periodization of History: A Comparative and Theoretic-Mathematical Approach
1. ON HISTORICAL PROCESS AND THE RULES OF PERIODIZATION Many scholars emphasize the great importance of periodization for the study of history (e.g., Jaspers 1953; Green 1992, 1995; Gellner 1988; Bentley 1996; Stearns 1987; McNeill 1995; Manning 1996; Goudsblom 1996; White 1987; Dyakonov 1999; Ershov 1984; Zhigunin 1984; Pavlenko 1997, 2002; Rozov 2001a, 2001b; Korotayev 2006). Gurevich emphasizes that the human thought cannot avoid dividing the historical process into definite periods (2005: 681). There is no doubt that periodization is a rather effective method of data ordering and analysis, but it deals with exceptionally complex types of processual, developmental and temporal phenomena and thus, it simplifies historical reality. This might be the reason why some scholars belittle the role of periodization and some of them even directly oppose the notion of process and stages as mutually exclusive (see, e.g., Shanks and Tilley 1987; see also Marcus and Feinman 1998: 3; Shtompka 1996: 238). One may agree that the contraposition of process and stages is a false dichotomy (Carneiro 2000) because stages are continuous episodes of a continuous process, and the notion of process can be used for the development of the notion of stages (Goudsblom 1996).
16
In fact, any periodization suffers from one-sidedness and certain deviations from reality, but as Jaspers noted, the purpose of such simplifications is to indicate the essentials (Jaspers 1953: 24). Moreover, the number and significance of such deviations can be radically diminished as the effectiveness of periodization is directly connected with its author's understanding of the rules and peculiarities of this methodological procedure. Our own research and analysis of different statements presented in the works on the problems of globalization allowed, with the account of the general systemic requirements, settling a system of methodological rules for developing a periodization of history, however, some of theses rules we had to formulate completely independently. Rule 1. The Presence of the Same Bases or Criteria. Rule 2. The Hierarchical Scale of Bases. Rule 3. The Equality of the Periods of the same Level of Division. Rule 4. The Close Association with Theory. Rule 5. Necessity of Additional Basis. Rule 6. The Correspondence to the Main Events and Facts. Regarding some of the rules see below (for more detail on these laws and procedures see Grinin 1998b: 1528; 2003a: 6778; 2003b: 219223; 2006a; 2006b; 2007b; Grinin and Korotayev 2009a; see also Shofman 1984). Unfortunately, an insufficient attention is paid to these issues (and problems of periodization in general), which leads to complicated problems. In particular, to develop a periodization one needs to observe the rule of the same bases, that is, to use the same criteria for the identification of periods with the same taxonomical significance, whereas many periodizations are not based on rigorous criteria, or the applied criteria are eclectic and change from one stage to another (e.g., Green 1995), or the scholars just base themselves on the following scheme: Antiquity Middle Ages Modern Age (see Green 1992). The second point is how well the periodization bases are reasoned, and how they are connected with a scholar's general theory (Rule 4), as well as with the goal of periodization. For any periodization its basis is a very important point. One can choose different bases for periodization if to use constantly the same criteria. Different scholars choose different bases for periodization, ranging from changes in the types of ideas and mode of thinking (e.g., Comte 1974 [18301842]; Jaspers 1953) to eco-
Chapter 1. Production Revolutions and Periodization of History
17
logical transformations (Goudsblom 1996) and intercultural interaction (Bentley 1996). Many scholars, from the 18th century thinkers (Turgot, Barnave, Ferguson, Smith) to modern post-industrialists like Bell (1973) and Toffler (1980), base themselves on economic and technological criteria (see Grinin 2011e). Two extremes can be observed depending on the choice of criteria. Too often, when scholars ascribe absolute meaning to the chosen factors, in Pitirim Sorokin's words (Sorokin 1992: 522), they turn out to be partially right, but one-sidedly wrong at the same time. Some do not think at all about the connection between periodization and theory (on this issue see Stearns 1987; Bentley 1996), or periodization is used as a sort of headband for the main theory (e.g., Toffler 1980). Sometimes it is said that historians do not need periodization but these are usually precarious claims. In the history of any society the historians necessarily distinguish some periods. It is especially important for the archaeologists whose generalizing work is unthinkable without connection with periodization procedure. However, it is necessary to separate local periodizations from global periodizations of world history. In this chapter we suggest a model of periodization of historical process based on our theory of historical process (see also Grinin 1998b, 2000, 2003a, 2003b, 2006b, 2007b, 2007f, 2009b). Thus, here we shall concentrate on a brief description of the essence and chronology of periodization; we shall also demonstrate the possibilities of mathematical modeling of temporal processes and temporal cycles in historical development. It is important to state the following reservetion: this periodization can only be applied to world historical process (further denoted as historical process) and to a considerable (but not to the full) degree to the evolution of World System (interpreting it after the manner of Andre Gunder Frank [Frank 1990, 1993; Frank and Gills 1993; Korotayev, Grinin 2006; Grinin and Korotayev 2006, 2009a]). Thus, our periodization refers only to macroevolutionary processes, and therefore can be directly applied to the histories of particular countries and societies only by means of special and rather complicated methodological procedures. Its task is to define a scale for measurement of processes of the humankind's development (or at least of the evolution of World System) and to mark possibilities for intersocietal comparison. A few words are necessary in order to clarify our understanding of the historical process notion (for more detail see Grinin 2003a; Grinin and Korotayev 2009a). The first point to be made is that this notion is in
18
no way synonymous with world history.1 Of course, the notion of historical process is based on world history facts, but firstly, there have been chosen only those facts that are the most important from the point of view of process and changes; secondly, this set of facts has been ordered and interpreted in accordance with the analyzed spatial and temporal scales, trends and logics of historical development of humankind as a whole, as well as the present-day results of this development. In other words, historical process is in no way a mechanical sum of the histories of numerous peoples and societies, it is not even just the process of temporal movement and development of these people and societies. The historical process is a growing and even cumulative process of societal integration that has a certain direction and result. The notion of the historical process of humankind does not imply that humankind has always been a real system. It implies the following: (a) that we select a respective scale for our analysis; (b) that we take into account the fact that throughout all the periods of the historical process societies, civilizations and its other subjects have been developing unevenly, i.e. at a different rate of social progress. Among other things from the methodological point of view it indicates that for the analysis of historical process the most important role is played by the model of the influence produced by more developed regions on the less developed ones; (c) the interaction scale expands from one period to another until it reaches the scale of the whole planet; (d) hence, the historical process of humankind is, first of all, the process of movement from autonomous and isolated social minisystems towards the formation of the present extremely complex system of intensely interacting societies; (e) when (and if) humankind gets transformed into a subject whose development as a whole is determined (at least partially) by a general and explicitly expressed collective will, the historical process in its current meaning will come to its end, and this will lead to a transition to a new generation of processes.
1
However, even the very notion of world history and universal history, although a number of scholars recognize it as an important concept (e.g., Ghosh 1964; Pomper 1995; Geyer and Bright 1995; Manning 1996), had been considered as a rather useless concept for a long time by historians and social scientists, and even now very few of them recognize it (see Pomper 1995; Geyer and Bright 1995). But the most important is that while historians increasingly recognize the importance of world history, they remain relatively ignorant about it as a developing field (Pomper 1995: 1).
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Thus, historical process is a notion that generalizes an intricate complex of internal transformations and actions of various historical subjects, as a result of which important societal changes and integration, continuous enlargement of intersocietal systems take place, transition to the new levels of development is going on, and in general (taking into consideration the present results and future prospective), humankind gets transformed from a potential unity into an actual one. Of course, this definition of historical process is rather conventional; however, it has a considerable heuristic potential and makes it possible to construct generalizing theories. The critics of the notion world history process rely on the idea that humankind is not a system that can be regarded as a real subject and that the humankind's history is the history of particular societies; thus, it is impossible to speak about the historical process of humankind (see, e.g., Miljukov 1993 [1937] 4347; Hotsej 2000: 488489). In the meantime it becomes more and more evident that the globalization process is making (and, in some respects, has already made) humankind a real subject (about this see Chapter 2 of the present monograph). But if humankind is becoming a real supersystem and the process of this system's structuralization starts producing more and more tangible results, then why is it impossible to study the historical process of the humankind system formation? For example, McNeill (2001: 1) suggests that historians should make a sustained effort to enlarge the views and explore the career of humankind on earth as a whole. Quite often the notion of humankind is actually substituted with some other notions, like civilizations, starting from Danilevsky (1995 [1869]), Spengler (1939), Toynbee (19621963), and ending with Huntington (1994), or the World System (Frank 1990, 1993; Frank and Gills 1993; Wallerstein 1974, 1987, 2004; Chase-Dunn and Hall 1994, 1997; Arrighi, Silver 1999; Amin et al. 2006). Although we ourselves support the World System approach and try to offer our mite to the development of this theory (Grinin and Korotayev 2006, 2009a; Korotayev and Grinin 2006, 2009a; Grinin 2011f), we believe that such notions can be of much use, but only at a certain level and in certain aspects of analysis. And, of course, they differ from the notion of humankind both temporally (as the whole pre-agrarian epoch and the early agrarian period are left outside their limits) and spatially (if we do not try to make one notion a full synonym of the other). The attempts to substitute the notion of humankind with any other, less encompassing, notions are basically attempts to prohibit any research at a higher level of generaliza-
20
tion; this is just a substitution of one level of research with another, a narrower one.2 2. THE PRODUCTION PRINCIPLES AND PRODUCTION REVOLUTIONS According to the theory that we propose, the historical process can be subdivided more effectively into four major stages or four formations of historical process. The transition from any of these formations into another is tantamount to the change of all the basic characteristics of the respective formation. However, in addition to this principle basis of periodization (that determines the number of singled out periods and their characteristics), we need an additional basis (see Rule 5 above), by means of which the chronology may be worked out in detail.3 As such an additional basis we have proposed the production principle (e.g., Grinin 19951996, 2000, 2003a, 2007f, 2007k, 2009b) that describes the major qualitative stages of the development of the world productive forces.4 We single out four production principles: 1. Hunter-Gatherer. 2. Craft-Agrarian. 3. Industrial. 4. Information-Scientific. Though the qualitative transformations in some spheres of life are closely connected with changes in the other (and, thus, no factors can be considered as absolutely dominant), some spheres (with respect to their influence) can be considered as more significant; that is, changes within
2
These attempts have a long history. For example, Miljukov (1993 [1937]: 4347) declared the world historical view obsolete and insisted that the natural unit of scientific observation is nothing else but a national organism. Generally speaking, this point is especially important methodologically, as it accounts for the cyclical nature of the unfolding of the above mentioned stages/formations. The development of some spheres inevitably leads to the accumulation of changes in the other spheres till a radical transformation occurs within them that leads to the accumulation of non-system incongruence in the former. Thus, causes and effects constantly interchange their places, that is why it turns out to be impossible to speak about any absolutely dominant spheres; it appears more productive to consider some spheres as relatively dominant. This notion is not identical with the Marxist mode of production, because firstly, mode of production includes both the productive forces and the relations of production, whereas its change is connected with the change in the property relationships. The production principle only characterizes the changes in production and is connected with production revolutions. Secondly, the mode of production notion can be applied both to separate societies and to the historical process, whereas the production principle is a category that only describes the world production forces (for more detail see Grinin 2003: 3047).
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them are more likely to lead to changes in the other spheres than the other way round.5 The production principle belongs to such spheres due to the following reasons: 1. Significant changes in the production basis lead to the production of more surplus and to the rapid growth of population. And both these processes lead to changes in all other spheres of life. Still the transition to new social relations, new religious forms etc. is not so directly connected with the demographic changes as are the transformations of the production principle. 2. Though a significant surplus can appear as a result of some other causes (natural abundance, successful trade or war), such exceptional conditions cannot be borrowed, whereas new productive forces can be borrowed and diffused, and thus, they appear in many societies. 3. Production technologies are applied by the whole society (and what is especially important, by the lower social strata), whereas culture, politics, law, and even religion are systems developed by their participants (usually the elites).6 The change in production principles is connected with production revolutions. The starting point of such revolutions can be regarded as a convenient and natural point from which the chronology of formation change can be established. The production revolutions are the following: 1) the Agrarian Revolution (the Neolithic Revolution); 2) the Industrial Revolution; 3) the Information-Scientific Revolution. The production revolutions as technological breakthroughs have been discussed for quite a long time. The Industrial Revolution became an object of extensive research already in the 19th century.7 The first ideas on the Neolithic (Agrarian) Revolution appeared in Gordon Childe's works in the 1920s and 1930s, and the theory of this revolution was developed by him in the 1940s and 1950s (Childe 1948, 1949, 1952). In connection with the Information5
Of course, we do not mean continuous and regular influence; we rather mean the moments of qualitative breakthrough. If after a breakthrough within a more fundamental sphere the other spheres do not catch up with it, the development within the former slows down. 6 Sergey Malkov (2006) shows what changes take place in societies with the change of each production principle and develops mathematical models describing the functioning of a typical society for each production principle (except the information-scientific one). These models suggest that the change in our periodization basis, the production principle, does lead to a total change of all the main societal characteristics and to the humankind transition to a qualitatively new development stage (see also Malkov 2004, 2005). 7 E.g., by Arnold Toynbee (18521883). See Toynbee 1927 [1884]; 1956 [1884].
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Scientific Revolution which started in the 1950s the interest in the study of production revolutions significantly increased. However, the category production revolution has not been sufficiently worked out and its contents are determined in a predominantly intuitive way. Much has been written about each of the three production revolutions (see, e.g., Reed 1977; Harris and Hillman 1989; Cohen 1977; Rindos 1984; Smith 1976; Cowan and Watson 1992; Ingold 1980; Cauvin 2000; Knowles 1937; Dietz 1927; Henderson 1961; Phyllys 1965; Cipolla 1976a; Stearns 1993, 1998; Lieberman 1972; Mokyr 1985, 1993; More 2000; Bernal 1965; Philipson 1962; Benson and Lloyd 1983; Sylvester and Klotz 1983); however, there is a surprisingly small number of studies concerning these revolutions as recurrent phenomena, each representing an extremely important landmark in the history of humankind (e.g., Vasilyev 1977: 8; Cipolla 1976b: 7; Gellner 1983, 1988). Moreover, most of these studies are fragmentary and superficial. On the other hand, we have developed a theory of production revolution (Grinin 19951996, 2000, 2003a, 2006a, 2007a, 2007b, 2007f, 2007k, 2009b) within the framework of the overall theory of a world historical process. The production revolution can be defined as a radical turn in the world productive forces connected with the transition to the new principle of management not only in technologies but in the interrelations of society and nature. The difference of a production revolution from various technical overturns is that it touches not only some separate essential branches but the economy on the whole. And finally, the new trends of management become dominant. Such an overturn involves in the economical circulation some fundamentally new renewable or long inexhaustible resources, and these resources must be widespread enough within most territories; it rises labor productivity and/or land carrying capacity (the yield of useful product per unit of area) by orders of magnitude; this is also expressed in the creation of several orders greater volume of production and the demographic revolution (or the change of the demographic reproduction type). As a result, the most powerful impulse for qualitative reorganization of the whole social structure is generated. Although the production revolution begins in one or a few places but as it signifies the turn of the world productive forces, it represents a long lasting process gradually involving more and more societies and territories. As a result a) the societies where it took place become progressive in the technological,
23
economical, demographical, cultural and often military aspects; b) the break with new production system is an exception while joining it becomes a rule. Each production revolution has its own cycle. We can speak about two qualitative phases and a separating them phase of expansion of new production principle. The latter can be also regarded as a sort of a long period of distribution and diffusion of innovations. See also Fig. 1. Each phase of a production revolution represents a major breakthrough in production.8 During the first phase the new production principle hotbeds are formed; those sectors that concentrate the principally new production elements grow in strength. Then the qualitatively new elements diffuse to more societies and territories. In those places where the most promising production version has got formed and adequate social conditions have appeared the transition to the second phase of production revolution occurs, which marks the flourishing of the new production principle. Now underdeveloped societies catch up with the production revolution and become more actively engaged in it. Thus, we confront a certain rhythm of the interchange of qualitative and quantitative aspects. A general scheme of two qualitative phases of production revolution within our theory looks as follows: Agrarian Revolution: the first phase transition to primitive hoe agriculture and animal husbandry; the second phase transition to intensive agriculture (especially to irrigation or non-irrigation plough one). Industrial Revolution: the first phase starts in the 15th and 16th centuries with the vigorous development of seafaring and trade, mechanization on the basis of water engine, the deepening division of labor and other processes. The second phase is the industrial breakthrough of the 18th century and the first third of the 19th century which is connected with the introduction of various machines and steam energy. Information-Scientific Revolution: the first phase began in the 1940s and 1950s with breakthroughs in automation, power engineering, production of synthetic materials, but especially in the development of electronic means of control, communication and information. However, it appears possible to speak about its forthcoming second phase (see,
8
It is worthy of note that each phase of production revolution distinctly changes the modes of energy production, distribution, and consumption and diffuses such new modes. It was Leslie White (1949, 1959) who pointed out to a certain evolutionary sequence in the changes of energy sources of the human societies.
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e.g., Marahov 1984: 314; Grinin 2003a)9 which may start within a few decades. We believe that the production revolution can be regarded as an integral part (the first half) of the production principle. Thus, the overall cycle of the production principle can be represented in two phases: first is the production revolution which is followed by second the development of mature relations. Such an approach demonstrates in a rather explicit way the main intrigue of the cyclical pattern of historical formations. In their first half we observe mostly the radical production changes, whereas in the second half we deal with especially profound changes of political and social relations, public consciousness and other spheres. Within these periods, on the one hand, political-judicial and sociocultural relations catch up with more developed production forces, and, on the other hand, they create a new level, from which an impulse toward the formation of a new production principle starts.10 However, a production principle cycle can be also represented in a classical three-phase fashion: formation, maturity, and decline. Yet, in some sense it appears more convenient to represent it in six phases, each pair of which demonstrates an additional rhythm of change of qualitative and quantitative characteristics. Such a cycle looks as follows: 1. The first phase transitional. It is connected with the beginning of the production revolution and the formation of a new production principle in one place, or a few places, however, in rather undeveloped and imperfect forms. 2. The second phase adolescence is connected with a wider diffusion of new production forms, with the strengthening and vigorous expansion of the new production principle. A new formation (or World System) appears. 3. The third phase florescence is connected with the second phase of the production revolution, as a result of which a basis for the mature forms of the production principle is developed.
9
The possibility of the new phase of this revolution was already discussed by Volkov (1965; 1967: 391; 1968, 1976), who called it the second industrial revolution, though he imagined the development of this revolution in a rather one-sided (and in some respects even primitive) way, as the development of full automation without paying attention to its information technology aspects. See also Sylvester and Klotz 1983. 10 Such a cyclical pattern accounts for a number of historical phenomena for example, some slowdown of the production innovation rate in the last centuries BCE and the 1st millennium CE. This was a period when the most part of the creative energy was dissipated in order to enhance the military-political and sociocultural aspects of social life, as the material basis for this had already been created.
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4. The fourth phase maturity is connected with the diffusion of new technologies to most regions and production branches. The production principle acquires its classical forms. It is in this phase when particularly important changes start in non-production spheres as it was mentioned above. 5. The fifth phase high maturity leads to the intensification of production, the realization of its potential almost to the limit, after which crisis phenomena start to appear; that is, non-system (for the given production principle) elements begin to emerge. 6. The sixth phase preparatory. Intensification grows, more and more non-system elements that prepare the formation of a new production principle emerge. However, they do not form a system yet. After this in some societies a transition to a new production principle can take place, and a new cycle begins. The correlation between phases of production principles and phases of production revolutions is spelled out in Fig. 1.
Fig. 1. Correlation between phases of production principles and phases of production revolutions Explication: / / / / temporal volume of production revolution borders between production principles
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3. THE ELABORATION OF THE PERIODIZATION AND DEVELOPMENT OF HISTORICAL PROCESS 3.1. When does historical process start? Let us consider now our chronology of the production principles, production revolutions, and their phases. We start from the period about 40,00050,000 years ago (but to facilitate our calculation we take the date of 40,000 years ago), that is, since the appearance of the first indisputable indications of truly human culture and society.11 To understand the reason for the choice of precisely this landmark one should take into consideration that any periodization must have some conceptual and formal unity at its basis. In particular, we believe that it is possible to speak about social evolution in its proper sense only since the time when social forces became the basic driving forces for the development of human communities. We suppose that the era of anthropogenesis should include not only that long period of time when our apelike ancestors (Ingold 2002: 8) were gradually obtaining an anatomical resemblance to modern human beings (that is approximately till 100 200 thousand years ago), but the subsequent rather long period (that lasted for many thousands of years) when those creatures anatomically similar to us were turning into Homo sapiens sapiens, that is becoming people in their intellectual, social, mental and language development.
11
Note that this date is not identical with the modern dating of the emergence of Homo sapiens sapiens (100,000200,000 years ago). Though discoveries of the recent decades have shifted the date of the Homo sapiens sapiens formation back in time to 100200 thousand years ago (see, e.g., Stringer 1990; Bar-Yosef 2002; Bar-Yosef and Vandermeersch 1993; Marks 1993; Pbo 1995; Gibbons 1997; Holden 1998; Culotta 1999; Kaufman 1999; Lambert 1991; Zhdanko 1999; Klima 2003: 206; White et al. 2003; Shea 2007), the landmark of 40,00050,000 years ago still retains its major significance. This is that time, since which we can definitely speak about the humans of modern cultural type, in particular, about the presence of developed languages and distinctly human culture (Bar-Yosef and Vandermeersch 1993: 94). And though there are suggestions that developed languages appeared well before 4050 thousand years ago, these suggestions remain rather hypothetical. Most researchers suppose that the dependence on language appeared not earlier than 40,000 years ago (see Holden 1998: 1455), whereas, as Richard Klein maintains, everybody would accept that 40,000 years ago language is everywhere (see Holden 1998: 1455). Klein, a paleoanthropologist at Stanford University, has offered a theory which could explain such a gap between the origin of anatomically modern Homo sapiens and much later emergence of language and cultural artifacts: the modern mind is the result of a rapid genetic change. He puts the date of change at around 50,000 years ago, pointing out that the rise of cultural artifacts comes after that date, as does the spread of modern humans from Africa (see Zimmer 2003: 41ff.). So the period 50,00040,000 years ago was the time the beginning of social evolution in the narrow sense (see below).
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Of course, during this second phase of anthropogenesis the role of social forces in the general balance of driving forces was much larger than it was during the first phase. However, we believe that in general, during the whole process of anthropogenesis the driving forces were primarily biological, and only to a rather small degree were they social. Of course, it was a very long process and one cannot point out a definite moment when a crucial change took place (as most likely in a literal sense there was not such a radical turn). Nevertheless, we believe that after reaching the above-mentioned landmark of 40,00050,000 years ago the social component of the evolutionary driving forces became dominant.12 We also believe that for the same reasons it is not possible to speak about humankind as a set of societies before this time. Thus, the notions serving the basis for our periodization formations of historical process and production principles cannot be applied to the periods prior to 40,00050,000 years ago. Thus, our periodization starts with the most important production revolution for the humankind; what is more, people themselves are, undoubtedly, part of the productive forces.13 3.2. The first formations of historical process. The Hunter-Gatherer production principle Due to the paucity of information on the first formation it appears reasonable to connect the phases of the hunter-gatherer production principle with the qualitative landmarks of human adaptation to nature and its acquisition. Indeed, during this period community size, tools, economic forms, lifestyles that is, virtually everything depended almost exclusively on the natural environment. If we correlate phases with major changes in environment, it appears possible to connect them with an absolute chronology on the panhuman scale. This appears especially justified, as according to the proposed theory some part of the natural environment (within a theoretical model) should be included in the produc12
13
Yet in some certain important points the biological adaptation and anthropological transformation lasted for quite a long time even after this threshold. Yet in certain significant respects the biological adaptation and anthropological transformation continued for quite a long time after this threshold as (see, e.g., Alexeev 1984: 345346; 1986: 137145; Yaryghin et al. 1999, bk 2: 165). Or using the title of Paul Mellars and Chris Stringer's book such a radical turn can be called The Human Revolution (see Mellars and Stringer 1989).
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tive forces, and the more they are included, the weaker is their technological component (see Grinin 2000, 2003a, 2006c, 2009b). The first phase may be connected with the Upper Paleolithic Revolution (about it see Mellars and Stringer 1989; Marks 1993; BarYosef 2002; Shea 2007) and the formation of social productive forces (however primitive they were at that time). Already for this period more than a hundred types of tools are known (Boriskovskij 1980: 180). The second phase (approximately and very conventionally, 30,000 23,000 [20,000] BP) led to the final overcoming of what may be called the residue contradiction of anthropogenesis: between biological and social regulators of human activities. This phase is connected with the wide diffusion of people, the settlement in new places, including peopling of Siberia (Doluhanov 1979: 108) and, possibly, the New World (Zubov 1963: 50; Sergeeva 1983), though the datings here are very scattered (Mochanov 1977: 254; Sergeeva 1983; Berezkin 2007a, 2007b). The third phase lasted till 18,000 16,000 BP. This is the period of the maximum spread of glaciers (referred to as the glacial maximum).14 And though this was not the first glaciation, this time humans had a sufficient level of productive forces and sociality so that some groups managed to survive and even flourish under those severe conditions. Large changes took place with respect to variety and quantity of tools (Chubarov 1991: 94). This is precisely the time when there occurred a fast change of types of stone tools; for example, in France (Grigoriev 1969: 213), in the Levant (18,000 BP) microliths appeared (Doluhanov 1979: 93). During this phase, as well as the subsequent fourth phase c. 17,00014,000 (18,00015,000) BP the level of adaptation to the changing natural environment significantly increased. In some places that avoided glaciation, intensive gathering appeared (Hall 1986: 201; Harlan 1986: 200). The fifth phase 14,00011,000 (15,00012,000) BP, that is the end of the Paleolithic and the beginning of the Mesolithic (Fainberg 1986: 130) may be connected with the end of glaciation and climate warming (Yasamanov 1985: 202204; Koronovskij, Yakushova 1991: 404406). As a result of this warming and consequent change in the landscape the number of large mammals decreased. That is why the transition to indi14
During the last glacial epoch, Wrm III. The glacial maximum was observed about 20,000 17,000 BP when temperatures dropped by 5 degrees (Velichko 1989: 1315).
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vidual hunting was observed (Markov 1979: 51; Childe 1949: 40). Technical means (bows, spear-throwers, traps, nets, harpoons, new types of axes etc.) were developed for the support of autonomous reproduction of smaller groups and even individual families (Markov 1979: 51; Prido 1979: 69; Avdusin 1989: 47). Fishing in rivers and lakes was developed and acquired a major importance (Matjushin 1972). The sixth phase (c. 12,00010,000 BP) was also connected with continuing climatic warming, environmental changes culminating in the transition to the Holocene (see, e.g., Hotinskij 1989: 39, 43; Wymer 1982 [and archaeologically to the Neolithic in connection with considerable progress in stone industries]). This period evidenced a large number of important innovations that, in general, opened the way to the new, craft-agrarian, production principle (see, e.g., Mellaart 1975). The point of peculiar interest are the harvest-gathering peoples who were a potentially more progressive development of the craft-agrarian branch. Such gathering can be very productive (see, e.g., Antonov 1982: 129; Shnirel'man 1989: 295296; Lips 1956; Lamberg-Karlovsky, Sabloff 1979). Forestalling, we would like to say a few words in order to explain the quantitative proportions we have set between the periods of huntergatherer production principle which are presented below (see Tables 14). We have empirically determined certain correlations between the duration of the stages (phases) recurring within each production principle. But to what extent are these proportions relevant to hunter-gatherer production principle, if for the identification of the beginning of its periods we involve some exogenous factors of nature and climate changes? Indeed, since the climate changes could have occurred at some other moment these proportions are random to some extent. However, in general they are not random at all and are endogenously reasonable, because, first, each described successive cyclic change requires more or less definite period of time. This perfectly explains why the durations of the given processes-stages correlate between each other in certain proportions. Second, though in respect of society the climate changes can be considered as external (and therefore random) factors, however the diversity of macroevolutional lines significantly neutralizes such randomness. The idea logically following from the Rule of the necessary diversity is that the wider is the diversity, the higher is the probability of
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required randomness appearance at the right moment and at the right place. The same way a person staking on more than one event at once, secures himself from accidents, and so, figuratively speaking, evolution with greater variability can accomplish a breakthrough if not in one place then in another. That is why, although the proportions in the correlation of hunter-gatherer production principle stages can slightly shift, nevertheless, they will remain practically the same since the unpreparedness to qualitative changes terminates excessive suitable cases, and in the case of delay of such a shift and the appearance of society's high preparedness (overmaturity) to the changes necessary for the qualitative breakthrough even less suitable situations can be made use of. In particular, let us repeat that along with periods of maximal cooling in some places (which was on the whole random in respect of social macroevolution at certain time), there were highly specialized gatherers in other places, that was just non-random for social evolution. Consequently, the most important breakthroughs could have followed the same pattern already from 18,000 years ago, what probably would have slightly accelerated the beginning of Agrarian revolution, but, most likely, would have delayed its transition to the second phase. 3.3. The second formation of historical process. The Craft-Agrarian production principle Whatever plants were cultivated, the independent invention of agriculture always took place in special natural environments (see, e.g., [Deopik 1977: 15] with respect to South-East Asia). Correspondingly, the development of cereal production could only take place in certain natural and climate environments (Gulyaev 1972: 5051; Shnirel'man 1989: 273; Mellaart 1982: 128; Harris and Hillman 1989; Masson 1967: 12; Lamberg-Karlovsky, Sabloff 1979). It is supposed that the cultivation of cereals started somewhere in the Near East: in the hills of Palestine (Mellaart 1975, 1982), in the Upper Euphrates area (Alexeev 1984: 418; Hall 1986: 202), or Egypt (Harlan 1986: 200). The beginning of the agricultural revolution is dated within the interval 12,000 to 9,000 BP, though in some cases the traces of the first cultivated plants or domesticated animals' bones are even of a more ancient age of 14 15 thousand years ago. Thus, in a rather conventional way it appears possible to maintain that the first phase of the craft-agrarian production
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principle continued approximately within the interval from 10,500 to 7,500 BP (the 9th6th millennia BCE). This period ends with the formation of the West Asian agricultural region, and on the whole one may speak about the formation of the World-System during this period, also including its first cities (about cities see Lamberg-Karlovsky, Sabloff 1979; Masson 1989). The second phase can be conventionally dated to 80005000 BP (the 6th mid-late 4th millennia BCE), that is up to the formation of a unified state in Egypt and the development of a sophisticated irrigation economy in this country. It includes the formation of new agricultural centers, diffusion of domesticated animals from West Asia to other regions. The husbandry of sheep, goats and the first draught animals is developed. The active interchange of achievements (domesticates and their varieties, technologies, etc.) is observed. During this period (starting from the 5th millennium BCE) the first copper artifacts and tools appeared in Egypt and Mesopotamia (and a bit later in Syria) (Tylecote 1976: 9). According to Childe the so-called urban revolution took place at that time (Childe 1952: ch. 7; see also Lamberg-Karlovsky, Sabloff 1979; Masson 1989; Oppenheim 1968; see also Adams 1981; Pollock 2001: 45; Bernbeck, Pollock 2005: 17). During the third phase, 50003500 (53003700) BP, i.e. 3000 1500 BCE the agriculture emerges; animal husbandry, crafts and trade are differentiated into separate branches of economy. Though, according to our theory, crafts did not determine the development of agricultural revolution, it appears necessary to note that, according to Chubarov's data at the end of the second phase and the beginning of the third a very wide diffusion of major innovations (wheel, plough, pottery wheel, harness [yoke], bronze metallurgy, etc.) is observed (Chubarov 1991; see also about plough McNeill 1963: 2425; Kramer 1965; on bronze metallurgy Tylecote 1976: 9). This was the period when the first states, and later empires, appeared in the Near East. Urbanization also went on reaching new regions. This period ends with a major economic, agrotechnical, and craft upsurge in Egypt at the beginning of the New Kingdom (Vinogradov 2000b). The fourth phase (35002200 [37002500] BP, or 1500200 BCE) is the period when systems of intensive (including non-irrigation plough) agricultures formed in many parts of the world. We observe an unprecedented
32
flourishing of crafts, cities, trade, formation of new civilizations and other processes that indicate that the new production principle began to approach its maturity. This phase lasts till the formation of new gigantic world states from Rome in the West till China in the East, which later led to major changes in productive forces and other social spheres. The fifth phase (the late 3rd century BCE early 9th century CE) is the period of the most complete development of the productive forces of the craft-agrarian economy, the period of flourishing and disintegration of the ancient civilizations and formation of civilizations of a new type (Arab, European etc.). The sixth phase (from the 9th century till the first third of the 15th century). At its beginning one can see important changes in the production and other spheres in the Arab-Islamic world and China; in particular, in the second half of the 1st century BC the wide international trade network from the East African Coast to South-East Asia and China developed in the Indian Ocean basin (Bentley 1996). Then we observe the beginning of urban and economic growth in Europe, which finally creates first centers of industry and preconditions for industrial revolution. 3.4. The third formation of historical process. The Industrial production principle The first phase of the Industrial revolution (and, respectively, the first phase of the industrial production principle) may be dated to the period lasting from the second third of the 15th century to the late 16th century.15 This phase includes those types of activities that were both more open to innovation and capable of accumulating more surplus (trade [Mantu 1937: 6162; Bernal 1965] and colonial activities [Baks 1986], which had become more and more interwoven since the 16th century) came to the forefront. Besides, at that time, primitive industries (but still industries) developed in certain fields. It is during that period when according to Wallerstein (1974, 1987) the capitalist world-economy was formed.
15
The point of view that, besides the 18th century industrial revolution, there was also an earlier industrial revolution (or even industrial revolutions) is widely accepted in Western science (Bernal 1965; Braudel 1973, 1982, 1985; Hill 1947; Johnson 1955, etc.), but until now within Russia it has quite a few advocates. Still it appears that in the last two decades the idea of marking out Early Modern Period (the end of the 15th 18th centuries) has attracted a number of supporters. However, these scholars do not associatet Early Modern Period with earlier industrial revolution.
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From the late 16th century to the first third of the 18th century there lasted the second phase (adolescence) of the new production principle, a period of growth and development of new sectors that had become dominant in some countries (the Netherlands and England). The third phase of the industrial production principle began in the second third of the 18th century in England. It meant the beginning of the second phase of the industrial revolution that led to the development of the machine-based industries and the transition to steam energy. Supplanting handwork with machines took place in cotton textile production that developed in England (Mantu 1937: 184). Watt's steam engine started to be used in the 1760s and 1770s. A new powerful industry machine production had developed. The industrial breakthrough was more or less finalized in England in the 1830s. The successes of industrialization were evident in a number of countries by that time and it was also accompanied by significant demographic transformations (Armengaud 1976; Minghinton 1976: 8589). The fourth phase (from the 1830s to the late 19th century) is the period of the victory of machine production and its powerful diffusion. The fifth phase took place in the late 19th century the early 20th century up to the world economic crisis of the late 1920s1930s. During that period there occurred huge changes. The chemical industries experienced vigorous development, a breakthrough was observed in steel production, the extensive use of electricity (together with oil) gradually began to replace coal. Electrical engines changed both the factories and everyday life. Development of the internal combustion engines led to the wide diffusion of automobiles. The sixth phase continued till the mid-20th century. A vigorous intensification of production and the introduction of scientific methods of its organization took place during this period. There was an unprecedented development of standardization and the enlargement of production units. Signs of the forthcoming information-scientific revolution became more and more evident. 3.5. The fourth formation of historical process. The Information-Scientific production principle The production revolution that began in the 1940s and 1950s and continues up to the present is sometimes called the scientific-technical revolution (e.g., Benson and Lloyd 1983). However, it would be more appropriate to call it the information-scientific revolution, as it is con-
34
nected with the transition to scientific methods of production and circulation management. Especially important changes took place in information technologies. In addition, this production revolution had a few other directions: in energy technologies, in synthetic materials production, automation, space exploration, and agriculture. However, its main results are still forthcoming. The information-scientific production principle (and the fourth formation in general) is only at its beginning; only its first phase has been finished and the second phase has just started. Hence, all the calculations of the forthcoming phases' lengths are highly hypothetical. These calculations are presented in Tables 1 and 2 (see below). The first phase of the information-scientific production principle took place between the 1950s and mid-1990s, when a vigorous development of information technologies and the start of real economic globalization were observed. The second phase began in the mid-1990s in conjunction with the development and wide diffusion of user-friendly computers, communication technologies, cell phones and so on. It has been going on up to the present. The third phase may begin approximately in the 2030s2040s. It will mean the beginning of the second phase of the informationscientific revolution that in our view may become a control system revolution, that is, the vast expansion of opportunities to purposefully influence and direct various natural and production processes (see Grinin 2000, 2003a, 2006a). Judging by the recent scientific, biotechnological and medical inventions (in particular, within nanotechnologies), the second phase of this revolution may start with changing human biological nature. There is a great number of various suppositions concerning changes of that kind, they are dealt with by intellectuals in different fields starting from philosophers to fantasists (see e.g., Fukuyama 2002; Sterling 2005). For the expected lengths of the fourth, fifth, and sixth phases of the information-scientific production principle see Table 1. In general, it may end by the end of this century, or by the beginning of the next one. There would be even no future shock that Toffler discovered for public in 1970 (Toffler 1970). This implies an immense acceleration of development that can be hardly compatible with the biopsychic human nature. Indeed, in view of the growing life expectancies all the immense
35
changes (the 2040s to 2090s) will happen within the span of one generation that will appear in the 2010s. The significance of these changes will be no smaller (what is more, it is likely to be greater) than the significance of the ones that took place between 1830 and 1950 that included gigantic technological transformations, the transition from agricultural to industrial society, social catastrophes and world wars. However, these metamorphoses took place within 120 years, whereas the expected period of the forthcoming transformation is twice as short. And if they occur within a lifespan of one generation, it is not clear whether human physical and psychic abilities will be sufficient to stand this; what will be the cost of such a fast adaptation? Thus, we confront the following question: how could the gap between the development of productive forces and other spheres of life be compensated?16 4. MATHEMATICAL INTERPRETATION OF HISTORICAL PROCESS With regard to social disciplines, a question continually arises: are mathematical methods suitable for analyzing historical and social processes? Obviously, we should not absolutize differences between fields of knowledge, but the division of sciences into two opposite types, made by W. Windelband and H. Rickert, is still valid. As is known, they singled out sciences involving nomothetic methods, i.e., looking for general laws and generalizing phenomena, and those applying idiographic methods, i.e., describing individual and unique events and objects. Rickert attributed history to the second type. In his opinion, history always aims at picturing an isolated and more or less wide course of development in all its uniqueness and individuality (Rickert 1911: 219).
16
Besides one should take into account the point that precisely this generation will have the controlling stake of votes during elections (taking into account the fertility decline that is likely to continue throughout this century), and it is not clear if this generation will be able to react adequately to the rapidly changing situation. On the acceleration of historical time and the necessity of stabilization see Grinin 1998, 2006a; see also Dyakonov 1999: 348; Kapitza 2004, 2004b, 2006; Korotayev, Malkov, and Khaltourina 2006a, 2006b. Yet, there also exist tendencies to slowing down this development. S. Tsirel (2008) pays attention to one of them. He points out that ordinary time (i.e. everyday, common tempos and rhythm within the limits of usual human existence) starts to hamper historical changes, because it is hard for people to break themselves of the habit of what they got accustomed to in childhood and youth, they deliberately or unconsciously resist changes in various ways. Actually one may completely agree that this sound conservatism is able to prevent acceleration. However, will such a tendency of hampering be powerful enough? There is much doubt about it.
36
However, since the number of objects and problems investigated and solved by precise methods is growing rapidly, we may assume that, with time, historical knowledge will also be analyzed by some branches of mathematics. Thus, the problem remains debatable. Nevertheless, rational attempts to use mathematical methods in theoretical or applied trends of the humanities are on the whole positive. Yet, they dry up the soul of history to some extent, but at the same time, they promote self-discipline and self-testing of thoughts, ideas, and concepts of many specialists in the humanities, who, unfortunately, often do not bother to find any methods of testing their conclusions. In addition, this could somewhat reduce the polysemy of the scientific language of the humanities. R. Carnap in his Philosophical Foundations of Physics (Carnap 1966) wrote that, even in physics, the use of terms from ordinary language (as the notion of law) for an accurate and nonambiguous expression of ideas complicates proper understanding. However, physicists, as well as other representatives of natural sciences, long ago agreed on fundamentals (such as units of measurement and symbols). As for the humanities, which analyze social phenomena, the same objects sometimes have up to ten meanings and hundreds of definitions. Perhaps the very necessity to formalize the humanities will lead at last to certain conventions and the ordering of terminology. Nevertheless, even today the use of mathematics may help in searching for a common field of research. Can we after all construct any mathematical models for such a complex subject of inquiry as the historical process? The answer to this question is obvious: yes, it is quite possible when examining countable objects. However when we speak about some global general theories, like macroperiodization of the world historical process, any figures, cycles, diagrams and coefficients, of course, cannot prove too much by themselves. Especially, if the respective analysis includes ancient periods for which all the figures are likely to be too much approximate and unreliable. Thus, for general theories covering immense time spans and space, the main proves are a good empirical basis, logics, internal consistency and productivity of theoretical constructions; that is, a theory's ability to explain the facts better than other theories do. On the other hand, any theory is better when it is supported by more arguments. Mathematical proofs can be rather convincing (when they are relevant, of course).
37
This is especially relevant with respect to those aspects that are more liable to mathematical analysis, for example, those connected with demography. In this chapter we have chosen such an aspect that is liable to mathematical analysis and quite suitable for it. This is the temporal aspect of history. Its suitability for mathematical analysis is connected with the following: though it is quite possible to speak about the tendency of historical time toward acceleration (and this is the subject of the present chapter), the astronomic time remains the same. Thus, within this study we have a sort of common denominator that helps to understand how the numerator changes. Hence, we believe that for the analysis of periodization of history the application of mathematical methods is not only possible, but it is also rather productive. Now we can start our mathematical analysis of the proposed periodization. Mathematical methods are quite widely used in historical research, but, unfortunately, mathematical studies of historical periodization are very few indeed.17 However, it is worth mentioning that there have been published several issues of the almanac with a speaking title History and Mathematics (Grinin, de Munck, and Korotayev 2006; Turchin, Grinin, de Munck, and Korotayev 2006; Grinin, Herrmann, Kortayev, and Tausch 2010). In the meantime the discovery of mathematical regularities within an existing periodization may serve as a confirmation of its productivity and as a basis for tentative forecasts. Time as a parameter of historical development is quite suitable for mathematical analysis, for example, economic and demographic historians study actively temporal cycles of various lengths (about Juglar and Kondratieff cycles see Grinin, Korotayev 2010a; Grinin, Korotayev, Malkov 2010a). Cycles used as a basis for this periodization are not dif17
It appears reasonable to mention here the works by Chuchin-Rusov (2002) and Kapitza (2004b, 2006). Some ideas about the detection of mathematical regularities were expressed by Igor Dyakonov. In particular, he wrote the following: There is no doubt that the historical process shows symptoms of exponential acceleration. From the emergence of Homo Sapiens to the end of Phase I, no less than 30,000 years passed; Phase II lasted about 7,000 years; Phase III about 2,000, Phase IV 1,500, Phase V about 1,000, Phase VI about 300 years, Phase VII just over 100 years; the duration of Phase VIII cannot yet be ascertained. If we draw up a graph, these Phases show a curve of negative exponential development (Dyakonov 1999: 348). However, Dyakonov did not publish the graph itself. Snooks suggests a diagram called The Great Steps of Human Progress (Snooks 1996: 403; 1998: 208; 2002: 53), which in some sense can be considered as a sort of historical periodization, but this is rather an illustrative scheme for teaching purposes without any explicit mathematical apparatus behind it.
38
ferent in any principal way from the other temporal cycles with regard to the possibility of being subject to mathematical analysis. Table 1 (Chronology of Production Principle Phases) presents dates for all the phases of all the production principles. However, it should be taken into account that in order to make chronology tractable all the dates are approximated even more than the ones used in the text above. Table 2 (Production Principles and Their Phase Lengths) presents the absolute lengths of the phases in thousands of years.
Table 1. Chronology of production principle phases (figures before brackets correspond to absolute datings (BP); figures in brackets correspond to years BCE. Bold figures indicate phase lengths (in thousands of years)
Production principle 1 phase
st
2 phase 30 000 22 000 (28 000 20 000 BCE) 8 7300 5000 (5300 3000 BCE) 2.3 1600 1730 0.13 2000 2040 (1995 2030) 0.035 0.04
nd
3 phase 22 000 17 000 (20 000 15 000 BCE) 5 5000 3500 (3000 1500 BCE) 1.5 1730 1830 0.1 2040 2070 (2030 2055) 0.025 0.03
rd
4 phase 17 000 14 000 (15 000 12 000 BCE) 3 35000 2200 (1500 200 BCE) 1.3 1830 1890 0.06 2070 2090 (2055 2070) 0.015 0.02
th
5 phase 14 000 11 500 (12 000 9500 BCE) 2.5 2200 1200 (200 BCE 800 CE) 1.0 1890 1929 0.04 2090 2105 (2070 2080) 0.01 0.015
th
6 phase 11 500 10 000 (9500 8000 BCE) 1.5 800 1430 CE 0.6
th
1. Hunter- 40 000 Gatherer 30 000 (38 000 28 000 BCE) 10 2. Craft10 000 Agrarian 7300 (8000 5300 BCE) 2.7 3. Indus- 1430 trial 1600 0.17 4. Informa- 1955 tion2000 Scientific (1955 1995)* 0.04 0.045
1929 1955 0.025 2105 2115 (2080 2090) 0.01
Overall for production principle 40 000 10 000 (38 000 8000 BCE) 30 10 000 570 (8000 BCE 1430 CE) 9.4 1430 1955 0.525 1955 2115 (2090) [forecast] 0.135 0.160
Note: In this line figures in brackets indicate the shorter estimates of phases of the Information-Scientific production principle (the fourth formation). Starting from the second column of this row we give our estimates of the expected lengths of the information-scientific production principle phases.
39
Table 2. Production principles and their phase lengths (in thousands of years)
Production principle 1. HunterGatherer 2. Craft-Agrarian 3. Industrial 4. InformationScientific 1st phase 2nd phase 10 2.7 0.17 0.04 0.045 8 2.3 0.13 0.035 0.04* 3 phase 5 1.5 0.1
rd
Overall 4 for pro5th phase 6th phase phase duction principle 3 2.5 1.5 30
th
1.3 0.06
1.0 0.04 0.01 0.015
0.6 0.025 0.01
9.4 0.525 0.135 0.160
0.025 0.015 0.03 0.02
* This line indicates our estimates of the expected lengths of the informationscientific production principle phases.
Table 3 (Ratio of Each Phase [and Phase Combination] Length to the Total Length of Respective Production Principle [%%]) presents results of our calculations of the ratio of each phase's length to the length of the respective production principle using a rather simple methodology.18 Table 4 (Comparison of Phase Length Ratios for Each Production Principle [%%]) employs an analogous methodology to compare lengths of phases (and combinations of phases) within one production principle. For example, for the hunter-gatherer production principle the ratio of the first phase length (10,000 years) to the second (8,000 years) equals 125 %; whereas the ratio of the second phase to the third (5,000 years) is 160 %. In the meantime the ratio of the sum of the first and the second phases' lengths to the sum of the third and the fourth (3,000 years) phases equals 225 %. Tables 3 and 4 also present the average rates for all the production principles.
18
The absolute length of a phase (or a sum of the lengths of two or three phases) is divided by the full length of the respective production principle. For example, if the length of the huntergatherer production principle is 30,000 years, the length of its first phase is 10,000, the one of the second is 8,000, the duration of the third is 5,000, then the ratio of the first phase length to the total production principle length will be 33,3 %; the ratio of the sum of the first and the second phases' lengths to the total production principle length will be 60 %; and the ratio of the sum of the first, the second, and the third phases' lengths to the total production principle length will be 76,7 %.
40
Table 3. Ratio of each phase (and phase combination) length to the total length of respective production principle (%%)
Production principle 1. HunterGatherer 2. CraftAgrarian 3. Industrial 4. InformationScientific Mean 1 33.3 28.7 32.4 2 26.7 24.5 24.8 3 16.7 16.0 19 4 10 13.8 11.4 5 8.3 10.6 7.6 6 5 6.4 4.8 12 60 53.2 57.1 34 26.7 29.8 30.5 56 13.3 17 12.4 13 76.7 69.1 76.2 46 23.3 30.9 23.8
28.1 25 18.8 12.5 9.4 6.3 53.1 31.3 15.6 71.9 28.1 (29.6)* (25.9) (18.5) (11.1) (7.4) (7.4) (55.6) (29.6) (14.8) (74.1) (25.9) 30.6** 25.3 17.6 11.9 9 5.6 55.9 29.6 14.6 73.5 26.5
* In this line figures in brackets indicate the shorter estimates of phases of the information-scientific production principle (the fourth formation). ** The calculation of mean took into account only one version of the information-scientific production principle evolution (that is figures before brackets). Table 4. mparison of phase length ratios for each production principle (%%)
Production principle 1. HunterGatherer 2. CraftAgrarian 3. Industrial 4. InformationScientific Mean* 1:2 125 117.4 2:3 160 153.3 3:4 166.7 115.4 4:5 120 130 5:6 166.7 166.7 160 150 (100) 160.9 (1+2): (3+4) 225 178.6 187.5 170 (187.5 190.3 (3+4): (5+6) 200 175 246.2 200 (200) 205.3 (1+2+3): (4+5+6) 328.6 224.1 320 255.5 (285.7) 282.1
130.8 130 166.7 150 112.5 133.3 150 133.3 (114.3) (140) (166.7) (150) 121.4 144.2 149.7 133.3
* The calculation of mean took into account only one version of the information-scientific production principle evolution (that is figures before brackets).
Thus, the proposed periodization is based on the idea of recurrent developmental cycles (each of them includes six phases); however, each subsequent cycle is shorter than the previous one due to the acceleration of historical development. No doubt that these are recurrent cycles, because within each cycle in some respect development follows the same pattern: every phase within every cycle plays a functionally similar role;
41
what is more, the proportions of the lengths of the phases and their combinations remain approximately the same (see Tables 3 and 4). All this is convincingly supported by the above mentioned calculations, according to which with the change of production principles stable proportions of the lengths of phases and their combinations remain intact. In general, our mathematical analysis represented in diagrams and tables indicates the following points: a) evolution of each production principle in time has recurrent features, as is seen in Diagrams 14; b) there are stable mathematical proportions between lengths of phases and phase combinations within each production principle (Tables 3 and 4); c) the cycle analysis clearly indicates that the development speed increases sharply just as a result of production revolutions (see Diagram 5); d) if we calibrate the Y-axis of the diagram19, the curve of historical process acquires a hyperbolic (Diagram 6) rather than exponential shape (as in Diagrams 14), which indicates that we are dealing here with a blow-up regime (Kapitza, Kurdjumov, and Malinetskij 1997).
Diagram 1. Hunter-Gatherer production principle
10000 (8000 B CE)
Phase VI Phase V
14000 11500
Phase IV
17000
Phase III Phase II

30000 22000 (20000 BCE)
Phase I
40000 (3800 0 BCE) 4200 4000 3800 3600 3400 3200 3000 2800 2600 2400 2200 2000 1800 1600 1400 1200 1000 8000 6000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (20000) (14000) (12000) (8000) (28000) (4000) (38000)
years BP (BCE .)
19
Within the calibrated scale the changes from one principle of production to another are considered as changes by an order of magnitude, whereas changes within a principle of production are regarded as changes by units within the respective order of magnitude. Such a calibration appears highly justified, as it does not appear reasonable to lay off the same value at the same scale both for the transition from one principle of production to another (for example, for the Agrarian Revolution), and for a change within one principle of production (e.g., for the development of specialized intensive gathering). Indeed, for example, the former shift increased the carrying capacity of the Earth by 12 orders of magnitude, whereas the letter led to the increase of carrying capacity by 23 times at best.
42
Leonid Grinin. Macrohistory and Globalization Diagram 2. Craft-Agrarian production principle
1430 CE
Phase VI
800 CE
Phase V
200 BCE
Phase IV
150 0 B CE (35 00 B P)
Phase III Phase II

5300 BCE
3 000 BCE
Phase I
8000 BCE (100 00 B P)
9 000
80 00
700 0
6 000
500 0
4000
3000
2000
1000
1000
2 000
BCE
CE
Diagram 3. Industrial production principle
1955 Phase VI
Phase V
1929
Phase IV 1830
1890
Phase III
1730 Phase II 1600
Phase I 1430 CE
CE . .
1400 1430
1460
1490 1520 1550
1580 1610 1640
1670
1700 1730 1760
1790
1820 1850 1880
1910
1940 1970 2000
Chapter 1. Production Revolutions and Periodization of History Diagram 4. Information-Scientific production principle
g p
2090 2115
43
Phase VI
2080 2105
Phase V
2055
2070 2090
Phase IV
2030
2070
Phase III
1995
2040
Phase II
1955 1955
2000
Phase I
1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 2120 2130
Note: the broken line indicates the forecast version for the expected development of the information-scientific production principle corresponding to dates in brackets in the line of Information-Scientific Production Principle in Table 1. Diagram 5. Evolution of historical process in time
Formation IV (information-scientific production principle)
2115 2105 2090 2070 2040 2005 2000 1955 1929 1890 1830 1730 1600 800 1430
Formation III (industrial production principle)
Formation II (craft-agrarian production principle) Formation I (hunter-gatherer production principle)

38000 BCE (40000 BP) 28000
1500 5300 8000 10500 12000 3000
200
15000 20000
BCE
0 CE
44
Leonid Grinin. Macrohistory and Globalization Diagram 6. Hyperbolic model of historical process dynamics
2000 1800 1600 1400 1200 1000
2000 CE
1955 CE
800 600 400 200 0 -50000 -200 -400 -40000 -30000 - 20000 -10000 0
38 000 BCE
8 000 1430 CE BCE
BCE
CE
The analysis of stable proportions of production principle cycles makes it possible to propose some tentative forecasts (in particular, with respect to the lengths of the remaining phases of the fourth production principle). And the last comment. The historical process curve (see Diagram 6) might look a bit embarrassing, as it goes to infinity within a finite period of time. In this respect Dyakonov (1999: 348) notes the following:
As applied to history, the notion [of infinity] seems to make no sense: the succession of Phases, their development ever more rapid, cannot end in changes taking place every year, month, week, day, hour or second. To avoid a catastrophic outcome let us hope that wise Homo Sapiens will find a way then we have to anticipate intervention from as yet unknown forces.
However, it should be taken into account that the diagram depicts the development of just one variable of the historical process the technological one, whereas the high correlation between general development and technological development is observed within certain limits. Outside these limits various deviations (both with respect to the development vectors and its speed) are possible. First of all, it is quite evident that the general development of the system does not catch up with
45
the technological one; secondly, the growing gap implies that the price for progress will grow too. In other words, uncontrolled scientifictechnological and economic changes lead to the growth of various deformations, crisis phenomena in various spheres of life, which slows down the overall movement and in many respects changes its direction. Actually, if the system persists, the overall speed of its development cannot exceed the speed of the least dynamic (most conservative) element (for example, ethnic, or religious-ideological consciousness, or morals) whose change needs the change of generations. The growth of the system gaps in connection with changing economic, information, and technological realities can lead to its breakdown and its replacement with another system. And the price paid for such a rapid transformation of such an immensely complex system as modern humankind may be very high indeed.
Chapter 2 The Role of an Individual in History: A Reconsideration
When thinking over historical events, the question always arises as to the role of historical personalities/agents and to what extent and in what manner they influence the course of history and the choice of one or another evolutionary alternative. The interest in the problem of the role of an individual depends much on the characteristics of an epoch: in quiet times it decreases, and in the violent and turbulent ones it increases. Thus, in the first half of the 20th century the problem of the role of an individual was more relevant (see Hook 1955: 3) than it was in the second half. The current period yet in a different way than it was during the warlike and revolutionary 1920s, 1930s, and 1940s is also crucial. Contrary to the prediction of the early 1990s about the end of history (see Fukuyama 1992) recent events prove the opposite. History, it seems, has come not to the end but rather to the beginning of new colossal changes. Humankind has found itself on the threshold of a new landmark; in such epochs the influence of historical agents, which in the modern world include not only politicians and ideologists, but also businessmen and outstanding personalities, on the future historical development may be especially significant. The very fact that all history rests upon antitheses, contrasts, struggles and wars, explains the decisive influence of certain men in definite occasions justly emphasizes Antonio Labriola (1986 [1896]: 232). But the question as to what are these definite occasions, in what cases they occur and in what cases they do not, and consequently when the role of an individual (and of what kind of an individual) is great and when it is small, requires a special analysis and procedures, with the account of a great number of factors including the character of the epoch and society and so on.
Chapter 2. The Role of an Individual in History: A Reconsideration 47
The second section of the chapter will be devoted to the analysis of these procedures and circumstances in the author's interpretation; and in the first section we will concentrate on the way the thinkers of the past and present have been solving these matters. Section 1 1. VIEWS ON THE ROLE OF AN INDIVIDUAL IN HISTORY UP TO THE 18th CENTURY Antiquity. Most Ancient Greeks and Romans had a fatalistic point of view on the future, as they believed that people's life was predetermined (see, e.g., Herodotus, The Histories, I, 107ff.; Livius, The History of Rome, 1: 34). At the same time historiography was mostly humanistic, so the belief in fate combined there with the idea that much depends on the individuals conscious agency (see Collingwood 1994 [1928]). In particularly this is proved by politicians' and military commanders' biographies composed by such ancient authors as, e.g., Thucydides and Plutarch. The Greeks and Romans failed to develop a coherent philosophy of history, and their ideas often reduced historical development to perpetual cycles. In the ancient philosophical and historical thought the problem of the role of an individual was paid no serious consideration, besides, the fluctuation of the former between fatalism and belief in human power1 in any case did not enable the antique authors to solve it. Middle Ages. In a different way and to a certain extent more logically (although incorrectly) the problem of the role of an individual was solved in the medieval theology of history. According to this viewpoint, the historical process was unambiguously considered as a realization of not human but divine goals. According to the ideas of Augustine and of the vast majority of Christian thinkers (including those of the Reformation period in the 16th century) history is realized following the initially provided divine plan. But since God acts through the selected people then to understand their role means to find out the hints of God's intention (see Collingwood 1994). That is why the interest in the role of individual in history in certain terms took on special significance.
1
See, e.g., Tacitus, The Annals, VI, 22.
48
Augustine (e.g., in De libero arbitrio) and other medieval philosophers failed to solve the problem of free will consistently. Here originates the further divergence in the understanding of historical laws and the role of an individual.2 Notwithstanding the providentialism, the biographical genre was rather widespread in medieval historiography. By the example of early Byzantium historian Procopius of Caesarea (between 490 and 507 after 562) one can see to what extent the estimation of an individual's role in history depends on the historian himself, his status and worldview. If in his official works The Wars of Justinian, The Buildings of Justinian Procopius praises the emperor, his war and policy, then in his Secret History he subjects Justinian and his surroundings to criticism and strong moral condemnation, depicts his rule as tyranny, and considers his policy's results as harmful and fatal for the state. The greatest Arab scholar Ibn Khaldn (13321406) in his famous The Muqaddimah: An Introduction to History the first volume of his extensive historical studies Kitab al-Ìbar followed rather deterministic viewpoint when considering historical process as the recurrence of political-dynastic cycles. According to his interpretation, the role of the ruler's personality is rather insignificant because the historical process is driven by the law of change of dynasties and of the phases of state's life. Perhaps, to a greater extent the role of an individual is considered in Chinese historiography where the dynasties' decline is associated with wrong policy, and the philosophical political treatises point out when the policy turns out to be successful and when it does not. Nevertheless, in Chinese tradition we find the prevailence of moral didactic conceptions aimed at showing that the break with Confucian morality leads to the loss of the Mandate of Heaven (Baum 2004: 49). During the Renaissance the humanistic aspect of history came to the fore. Though the role of Providence was still recognized as the leading one in history, the outstanding people's activity was also considered the most important driving force in history. And so the problem of
2
In the Reformation period in the 16th century the question of free will made a sharp come-back. According to Calvin's viewpoint clearly expressed in his main work Institutes of the Christian Religion (Institutio Christianae religionis), human destinies are predetermined by God, that is why there are the saved and the damned.
the role of an individual, though not as a matter of pure theory, occupied a noticeable place in humanists' debates. Great Men's biographies and deeds were of much interest. One should make a special notice of Machiavelli's conception that was developed, primarily, in his famous work The Prince (e.g., Machiavelli 2004 [1515]), where he argues that the success of the ruler's policy and if to reconstruct Machiavelli's ideas of the historical process on the whole depends on the reasonability of the sovereign's policy, on his ability to use the appropriate means, including the most immoral ones.3 It is significant for our theme that Machiavelli put a question of the correlation between the politician's aim and the result of his activity, and moreover he was among the first to point at the fact that the critical role in history could be performed not only by heroes but also by immoral agents. In the period from the 16th to the 17th centuries the belief in new science grew, so history started to be considered a sphere where one could find out some laws; and that was a great step forward. However, in the 17th century the problem of the role of an individual was among the unimportant ones. The rationalists had no well-defined view on it, but taking into account their mechanical idea of society as just a mere sum of individuals (see, e.g., Barg 1987: 308), they recognized the great role of outstanding legislators and political figures, their ability to reform society and change the course of history. Indirectly it is also evident from the theories of social contract rather elaborated in Hobbes' work (15881679) Leviathan, or the Matter, Form, and Power of a Commonwealth, Ecclesiastical and Civil (see Hobbes 1982 [1651]) and John Locke's (16321704) Two Treatises of Government (see Locke 1988 [1688]). In fact such ideas implied that the first unknown figures (personalities) joining such a contract set the direction for history.4
3
In this period Italy suffered from fragmentation. So it seemed to Machiavelli that any immoral sovereign at the head of united Italy was better than a large number of permanently rivaling and feuding Italian states incapable to repel external aggression of France and other states (later Hobbes also believed that violation of human rights by the state was better than the internal disturbances). The fact that the subject of the role of an individual was interesting for thinkers of the 17th century but was not conceptualized by them is also marked by the famous Blaise Pascal's aphorism (16231662) Cleopatra's nose: had it been shorter, the whole aspect of the world would have been altered (Pascal 2002: 32).
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2. THE DEVELOPMENT OF VIEWS ON THE ROLE OF AN INDIVIDUAL FROM THE 18th TO EARLY 20th CENTURY In the Age of the Enlightenment philosophy of history appeared. One of its fundamental concepts was the existence of natural social laws based on eternal and common human nature. The problem of this very nature was solved in different ways. However, the opinion prevailed that society could be reorganized on reasonable grounds according to these laws (for more detail see Grinin 2011e). Hence the role of an individual in history was recognized to be rather great. In particular it was considered that an outstanding ruler could change history dramatically just having in mind such an idea and having rather strong will and sufficient means to accomplish this. For example, Voltaire in his History of the Russian Empire under Peter the Great portrayed Peter I as a demiurge spreading culture in an absolutely barbaric country.5 The Enlighteners did not realize that an individual could be understood adequately only within the environment where his or her appearance was uniquely possible and where his or her qualities could be shown up to a full. Otherwise one inevitably comes to the conclusion that the course of history depends too much on the accidental appearance of genii or outstanding deceivers.6 But still the Enlighteners' contribution to the growing interest in the question of the role of an individual was great. It is just since the Age of the Enlightenment it has become one of the most important theoretical problems. The emergence of developed conceptions of the role of an individual. More or less detailed conceptions and theoretic statements on the issue of the role of an individual appeared only in the 19th century. However, throughout this whole century the common frameworks for discussion on this problem were strictly limited. In George Plekhanov's words, the collision of opinions on this point often assumed the form of an antin5
He is a barbarian that creates people, he wrote to the Emperor Friedrich II about Peter (see Mezin 2003: Ch. 3). On Voltaire's works dedicated to Peter I see Grinin 2011e: Lection 8, Footnote 18. Peter is represented in a different way, for example, by Russian historian S. M. Solovyov: the people rose and was ready to start on a journey, i.e. for changes, they needed a leader, and he appeared (Solovyov 1989: 451). 6 The Enlighteners often portrayed outstanding people, especially religious figures, on the ground of the struggle with the Roman Catholic Church grotesquely as deceivers and tricksters who succeeded to influence the world by arts. (For example, d'Holbach [1899] characterized Muhammad as a voluptuous, ambitious and cunning Arab; moreover, he seriously explained the actions of Great Men that had influenced history by the peculiarities of their physiology.)
omy, whose first part was general laws and the second part the individuals' activities. From the point of view of the second part of the antinomy, history was simply a chain of accidents; from the point of view of the first part, it seemed that even the specific features of historical events were determined by the operation of general causes (Plekhanov 1956 [1898]). Only in the late 19th century they succeeded in some though still relative way to expand these frames. 2.1. The view on the individual as an instrument of historical law In the first decades of the 19th century when the Romanticism predominated, the interpretation of the role of an individual changed sharply. The approaches that placed a person in respective historical environment substituted the Enlighteners' ideas that almost the main reasons of many historical turnings and breakthroughs were connected with the role of a wise legislator creating a new political system out of nothing, or with a prophet of a new religion. And if the Enlighteners tried to explain the state of society by the laws issued by rulers, then the Romanticists on the contrary deduced governmental laws from society's character, and explained any changes in society's state by historical circumstances (see Kosminsky 1963: 273). On the whole it is not surprising that the Romanticists and similar schools (the German Historical School of Law etc.) were not much interested in historical figures' role, as they paid major attention to national spirit (Ger. Volksgeist) in different epochs and in its various manifestations. Of course, there is some truth in such an approach (if to discard some mysticism connected with ontologization of national spirit), but it obviously underestimates the individuals' creative role.7 Somewhat more profound theoretical approach to the subject belonged to the Romanticists of the French liberal historical school of the Restoration period (especially to Guizot). So in the course of their whole creative work they sought for the way to reconcile different views on the role of an individual in history, although with the emphasis on the supremacy of objective processes.8 In particular, they believed
7
With respect to the approaches to the role of an individual in history Ranke (17951886) constituted a definite exception among German historians. For example, according to Guizot an individual's role is one of the driving (although not the main) forces of history; and the leading one is Providence, i.e. virtually objective processes (see,
52
that great historical figures were able only to intensify or slow down the realization of the historical and social inevitability. In fact, this approach together with other ideas was later borrowed and developed by the Marxist school (and also by some other schools). Providentialism and determinism. In respect of the role of an individual Georg Wilhelm Friedrich Hegel (17701831) expressed views to a considerable degree similar to those of the Romanticists but in a more systematic way.9 Proceeding from his providentialist theory, he asserted that what is real is reasonable, i.e. it serves the realization of the necessary and reasonable historical process. Hegel's great merit with respect to the philosophy of history consists in representing the world history (Universal History according to Hegel) for the first time as a process, and moreover a logical one (for more detail, see Grinin 2010b, 2011e). According to some scientists he is a founder of the theory of historical environment (see Rappoport 1899: 39), also important for the problem of the role of an individual. Regularity, according to Hegel, was certainly expressed in the absolute way, so the WorldHistorical persons' mission was to be the agents of the World Spirit (Hegel 1935 [1837]). Of course, he meant only the figures that got positive evaluation in history. One of the main Hegel's ideas is that a great individual cannot create historical reality himself but can only disclose the inevitable future development where others can foresee nothing. The great personalities' concern is to understand the necessary immediate step in their world development, to make it their goal and to devote effort to its fulfillment. And then to get tragically out off the picture often at young age. However, for example, the appearance of Genghis Khan and the following destructions and demise of a number of states (although together with some positive outcomes in future as a result of the Mongol Empires formation) was it necessary and primarily reasonable? Or the appearance of Adolf Hitler and his launching of World War II? In short, this approach contains many ideas discordant to the actual historical reality.
e.g., Reizov 1956). Spiking of French scholars it makes sense to mention philosopher Cousin (17921867) who maintained that each great epoch can be presented as a Great Man's biography because each epoch fulfils the only idea (cf. with Carlyle's ideas). So not without reason Cousin was criticized for eclecticism because in this approach one could clearly see an attempt (quite unsuccessful) to combine the Enlighteners' and Romanticists' ideas. However, the Romanticists focused mainly on national histories, and Hegel introduced a theory of world historical process and respectively he was concerned with the world-historical personalities.
An important advance was the attempt to see the processes and laws underlying the canvas of historical events. However, for a long period of time there appeared a tendency to understate the role of an individual, asserting that resulting from society's natural development in case if a leader was needed one individual could always substitute another. Perhaps, even stronger than in Hegel's works the ideas of providentialism are expressed by Leo Tolstoy in his famous philosophical digressions in the third volume of War and Peace. According to Tolstoy, the significance of great individuals is imaginary, as a matter of fact they are only history's slaves, which is realized by the decree of Providence (Tolstoy 2010: Bk. IX, ch. 1). To the deterministic theories one can add the geographical school represented by Carl Ritter (17791859), the positivism of Auguste Comte (17981857), evolutionism represented by Herbert Spencer (1820 1903)10 and the Marxism (see below). Determinism did not become extinct even in the 20th century. Among its followers were, for example, the historian Edward Cheney (see Nagel 1966: 347). Andr Maurois, who came to the conclusion that nations cannot escape what is predestined (1957), was also tending to determinism. 2.2. Heroic, scientific, deterministic, middle and other views Glorifying of heroes and kings. English philosopher Thomas Carlyle (17951881) was one of those who returned to the idea of outstanding individuals and heroes in history. One of his most famous works which had great influence on the contemporaries and descendants was just called On Heroes, Hero-worship, and the Heroic in History (Carlyle 1993 [1841]). According to Carlyle the history of the world is but the biography of great men. So Carlyle focuses on these or those individuals and their role, preaches lofty aims and senses, presents a range of brilliant biographies. Such a heroic view undoubtedly drew attention to the role of Great Men, but it had too evident drawbacks (in addition to non-systemic de10
Among the three it was Spencer who though non-systematically studied the problem of the individual's role and violently criticized Carlyle's ideas. Spencer's general approach consisted in the idea that Great Men were merely products of their social environment resulted from a long chain of complex influence. Prior to such an individual can modify a society, the latter should create him (see Spencer 1896: 34).
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scription): only heroes were under consideration, a society was strictly divided into the leaders and masses, the causes of revolution were reduced to social feelings etc. Among the supporters of the heroic approach one can consider for example an American philosopher Emerson (18031882) (Emerson 2001 [1860]). In Sydney Hook's judgment, American scholar Frederick Adams Woods (18731939) was, perhaps, the most active advocate for the heroic interpretation of history after Carlyle. Unlike Carlyle and his other followers, Woods in his work The Influence of Monarchs: Steps in a New Science of History (Woods 1913) tried to provide social-historical grounds of his approach having investigated the activity of 386 rulers in Western Europe from the 12th century till the French revolution in the late 18th century. Search for opportunities of including an individual in the process and the epoch. Thus, in the 19th century there is a search of possibility to combine the recognition of some historical figures' greatness with the processes of historical development, at that the analyses of conformity between personality and environment became one of the most important in the problem of the role of an individual. In particular, German historian Karl Lamprecht (18561915), the author of twelve-volume History of Germany, comes to the conclusion that the general character of the epoch is an empirically given necessity for a Great Man. But there is no doubt that it is not that simple to set the bounds of such necessity. Lamprecht himself gives, in his opinion, an indisputable illustration asking whether Bismarck could bring Germany back to subsistence economy. It seems that the answer is evident. And the bounds of the necessity are found. But very soon (during World War I) it turns out that in the very same Germany everything began to be distributed by cards. Who could imagine that? And twenty years later in Russia and Germany the planned subsistence economy appeared where money lost its former role. And what is worse, slavery was restored. And if one had questioned in the times of Lamprecht whether it could be possible to restore slavery in Germany, it would have been very difficult to imagine that the answer could be positive. Thus, a completely just question on the boundaries of individual's possibilities does not allow giving a simple answer.
In the last decades of the 19th century and in the early 20th century in the controversies about the problem of the role of an individual one could observe an increasing application of arguments drawn from natural sciences and anthropology. William James (18421910), famous American philosopher, was one of those who in the focus of the problem of the role of an individual put the question about the surroundings in the broad sense and conformity of the individual with the environment. In his lecture Great Men and Their Environment (James 2005 [1880]) James developed his quite an interesting conception. He argues with Spencerians, who attached the most importance in changes to the evolution and interaction between society and environment, thus greatly understating the role of an individual. He believed that the main reason making society change from generation to generation is connected with the accumulation of individuals' influence, of their example, initiative and decisions. James chooses quite an original approach. He draws analogy with Darwin's theory about the influence of the environment on natural selection. A philosopher, according to James, must accept geniuses as a given entity the same way as a biologist accepts as an entity Darwin's spontaneous variations (i.e., spontaneous mutations according to modern genetics. L. G.). The role of an individual will depend on the degree of its conformity with the social environment, epoch, moment etc. James introduces a notion of receptivities of the moment. The societies' mutations from generation to generation are determined (directly or indirectly) mainly by the acts or examples of individuals whose genius (talent, potentialities) was so adapted to the receptivities of the moment (i.e., they appeared to be in tune with the characteristics of the period), or whose accidental position of authority was so critical that they became ferments, initiators of movements, setters of precedent or fashion, centers of corruption, or destroyers of other persons, whose gifts, had they had free play, would have led society in another direction (James 2005: 174). This position in my opinion was of considerable value: an important aspect of conformity of an individual to his role was captured; the typology of individual's roles was outlined although geniuses were still ranked the first; not only direct but also indirect influence of historic figures was shown; the variability of society development was indicated. But such an approach becomes an inside-out-determinism: all
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other driving forces find themselves beyond the role of an individual, it also becomes obscure why outstanding individuals abound in some epochs and are hardly present in others (see also Hook's critique of James [Hook 1955: 1619]). Marxism. The strong point of Marxism was in the ability to formulate quite a solid and persuasive theory which explained the historical process by means of material factors. Although Marxism completely broke off with providentialism and theology, it still inherited from Hegel's objective idealistic theory the belief that historical laws are invariant, i.e. they must be realized by any circumstances (the maximum possible variation: some time earlier or later, easier or with more difficulty, with more or less completeness). A range of propositions regarding the role of an individual in classical Marxist approach were formulated by Engels. But they were more systemically stated in Plekhanov's work To the Question of the Role of the Individual in History (1956 [1898]). According to Marxism an individual can attach some originality to the historical events or as Plekhanov states, an individual can only leave his particular imprint on the inevitable course of events, can accelerate or slow down the realization of the historical law, but cannot by any circumstances change the programmed course of history. And if there had not existed a particular individual it would have been substituted by another one, who would have performed the same historic role (see Engels 1934 [1890]; Plekhanov 1956). This approach was in fact based on the ideas of the inevitability of law realization (acting against all odds, with iron necessity). But such laws have never existed and will never do in history, because in the World System the societies play different functional roles, which often depend on the politicians' abilities. If a mediocre ruler delays adequate reforms, his state may get into dependence as it happened with China in the 19th century. At the same time, the well-performed reforms can turn a state into a new centre of power (thus Japan at the same period managed to reorganize and started its own invasions). Besides, Marxists did not take into account that an individual not only acts in certain conditions, but if having an opportunity creates those conditions to the extent and according to his own comprehension and peculiarities. For instance, at the time of Muhammad in the early
7th century Arabian tribes and chiefdoms felt the need in a new religion (ideology) and there appeared prophets and ideologists of various kinds among them (see, e.g., Korotayev, Klimenko, and Proussakov 2007). But what kind would be this new religion in its real implementation depended to a large extent on a particular individual. And above all, the Arabs for sure could have found some other religion but would it have become a world one without Muhammad? Finally, many events including socialist revolution in Russia (this one in particular and not revolution in Russia in general) should be recognized as a result that might not have been realized without a coincidence of events and the outstanding role of Lenin (and of Trotsky to a certain extent). Trotsky in his two-volume History of the Russian Revolution (1980 [1932]) also touches upon the problem of the role of an individual. But with the exception of a few ideas worthy of attention there was nothing original in this aspect compared to other Marxists' works. Among Marxist scholars, whose some ideas definitely differ from the above-mentioned orthodox views, one should mention Labriola (18431904), his Essays on the Materialistic Conception of History (1986 [1896]) have been already quoted, and also Antonio Gramsci (18911937) and Karl Kautsky (1854 1938) who will be referred later. The attempts to overcome the dichotomy and find different solutions. Gradually philosophers became unsatisfied with both strictly deterministic and fatalistic theories which left no creative historical role for individuals as well as voluntaristic theories stating that individuals can change the historical process any way they like. That is why researchers move away from drastic decisions. Evaluating the predominant trends in philosophy of history philosopher Charles Rappoport in the end of the 19th century wrote (1899: 4358) that the problem of an individual in addition to the two above-mentioned issues also allows the third possible solution of the question about the personalities' historical importance, which is a combination, or reconciliation, of the subjective and objective points of view. A historical figure is both a driver and a product of historical development ... This solution in its general form seems the closest to scientific truth (Rappoport 1899: 47).11
11
Rappoport (1899: 47) attributes Henri Th. Buckle's approach in History of Civilization in England (2001 [18571861]) to the middle viewpoint, which seems quite insufficient yet. On
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On the whole, this solution was right though it was difficult to keep to this middle viewpoint. Thus in Rappoport's opinion this third possible solution should be supplemented by other theoretical ideas which he develops (through the consideration of seven rather interesting points). But, after all, such ideas bring his view closer to the first viewpoint. Similar to the middle viewpoint was an approach of the famous Russian sociologist Nikolay Kareyev expounded in his comprehensive Essence of the Historical Process and the Individual's Role in History (Kareyev 1890). The search for some golden mean allowed a more objective consideration of the problem of the role of an individual in history in its various aspects etc. However, such a middle viewpoint did not explain many problems, in particular, when and why an individual can have a great and decisive influence on events and when he cannot. An individual and the masses. In the last third of the 19th and in the early 20th centuries the idea of a lone individual capable to perform (due to the strength of his character and talent) impossible things, including the change of the course of history, was very popular especially among revolutionary-minded young people. This put the problem of relationship of the hero and the masses (crowd) in the focus of attention. A substantial contribution to the development of this problem was made by Nikolay Mikhaylovsky. In his articles Heroes and Crowd (1882) and some other (see Mikhaylovsky 1998) he outlines a new theory and shows that under the notion of an individual one should not necessarily mean an outstanding individual, but any individual in general who by chance finds himself within certain circumstances in the lead or just ahead of the crowd. The point of Mikhaylovsky's ideas is that regardless of personal qualities an individual in certain moments is capable to sharply reinforce the crowd (the audience, group) by his emotional or other activity and moods, and thus the whole action acquires a special power. In short, the role of an individual depends on the extent its psychological influence is reinforced by mass perception.12
the contrary, Hook (1955: 67), in my opinion more rightfully, refers Buckle to the determinists. Buckle believed that in the general progress the individual's actions were of minor influence and called kings, statesmen and generals the puppets without historical meaning. Yet Mikhaylovsky in respect of historical personalities does not develop this idea thoroughly. His article presents a rather psychological aspect somewhat similar to Tarde's theory of imitation stated in the latter's work The Laws of Imitation (Tarde 1962 [1890]), taking into account that Mikhaylovsky's works had been published 8 years earlier.
12
If one interprets Mikhaylovsky's ideas in a certain direction then it is possible to say that the role of an individual depends on the force it heads or directs, because due to it the individual's strength increases many times.13 Such interpretation allows one of the most important aspects of the individual's role problem i.e. the relation between an individual and the masses to get a more adequate solution. Somewhat similar conclusions (but essentially supplemented through his Marxist class position and connected with more or less organized mass but not a crowd) were drawn by Karl Kautsky (1931 [1929]: 696). In the second part of the chapter we will examine this problem. 3. MODERN APPROACHES TO THE PROBLEM OF THE ROLE OF AN INDIVIDUAL So there is no doubt that a number of factors and reasons determine the significance of individuals, and their influence on the society can vary greatly under different circumstances. And in the early 20th century this idea obtained a more profound insight. But the problem of the role of an individual appears in the new light of its complexity in every historic epoch. The appearance of new individuals able to change the world, always required the philosophers to reconsider their views. Thus the figures of Lenin, Trotsky, Stalin, Mussolini and Hitler who overthrew the established ideas about state, society, violence and power of a historic personality, required a new view on the problem (see, e.g., Hook 1955: 3). So in the beginning of the 1940s the problem of the role of an individual appeared to be quite popular and urgent. Unfortunately, such an interest has never been expressed so intensively further on. One of the reasons of the weakening popularity of the problem was the growth of interest to long-term tendencies and processes (see, e.g., on the shift of such interest starting from the Annales School, Carr 1996, 2004), in which the role of an individual seems to be lost (but this is far from always being true). Sydney Hook. One should particularly mention Sydney Hook's book that was a noticeable step forward in the solution of the problem of
13
In fact, here appears something similar to the mathematical effect when one places nulls to the right of the number. If an individual is taken as a unit and people in the crowd are conditionally considered to be nulls, so when one out of these nulls turns into an individual-unit and takes the lead, there may come out a great number.
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Great Man influence on historical development and which is by far the most profound work on the issue in question. Hook convincingly and at times rather figuratively states a number of important propositions which to a greater extent allow avoiding extremes. According to the subtitle of his book A Study in Limitation and Possibility he studies some limitations and possibilities of Heroes' influence. In particular, in Chapter 6 he notes that, on the one hand, individual's activity in fact is limited by the environment circumstances and the society's character, and on the other hand, when there appear alternatives in the society's development the role of an individual increases dramatically up to the point when it becomes an independent force (Hook 1955: 116). At the same time he points out that in the situation of historical alternatives the choice of an alternative may greatly depend on the individual's qualities. Hook does not develop any classification of such alternatives and does not connect their existence to the society's state (stable unstable), but a number of given examples are nevertheless concerned with the most dramatic moments (revolutions, crises). However, he does not take into account that the individual's greatest influence can be revealed not so much in the period of old regime's collapse, but in the formation period of a new one (according to our model it is the fourth phase see below). Besides, he does not make clear the situation when alternatives appear either as the result of a crisis or as the result of Great Man's plan or intention without manifested crisis. However, these are very different situations. Hook hardly speaks about the latter. Meanwhile, examples similar to the proceedings of Peter the Great in Russia require special attention. Peter started dramatic reforms in the absence of crises menacing his power. Moreover, it was just his reforms and wars that provoked the crisis situation in the country which led to riots and plots against him.14 From this example it follows that, there are quite rare but occasionally emerging historical situations when by a coincidence of some conditions an outstanding person can choose the path himself and thus create an alternative way of development.
14
Though the old army the Streltsy in the 17th century often used to rebel and Peter's sister Sofia, cloistered in the convent, would intrigue against him, but still it was just Peter's innovations brought in with insulting cruelty and even with some pranks in respect of the old nobility, on the one hand, and the tsar's long-term absence (when he left the capital for study and experience in foreign countries) on the other, that increased the rebellious spirit dramatically.
The conditions are as follows: a) an appearance of an outstanding individual with the necessary set of qualities and virtues; b) concentration of great power in his hands; c) state and social order in the society which allows the ruler to substantially change the interrelations in it; d) existence of an external challenge from other countries; e) a possibility to borrow advanced knowledge and technologies (this condition is necessary only for modernizing countries, which was true for Russia in the late 17th early 18th century under Peter the Great). In Chapters 9 and 10 Hook shows an important difference among historic personalities according to their influence on the historical process (eventful man and event-making man). He posed Lenin as an eventmaking man, who in certain important respects had changed the development direction not only of Russia but of the whole world in the 20th century. I suppose that Hook has chosen the most convincing example to present an event-making man. However Hook does not clearly distinguish the important difference in the individual's influence on the whole humankind and only on separate societies. Hook quite unambiguously and rightfully dethrones the image of Hero in History or Great Man imposed by the tradition as a figure of moral and intellectual virtues. And still he fails to completely diverge from it. In this respect Kautsky's viewpoint is more preferable as he indicates that a great role in history can be played not only by individuals of exceptional virtues, but by almost anybody who has a big power (for detail see below). Hook attaches great importance to accidents and contingencies in history in their connection with the role of an individual; at the same time he is deeply opposed to the attempts to present history as waves of emergencies following one upon another (as in particular Fisher made attempts to do in his History of Europe [1935, I: vii]; see also Hook 1955: 142). Hook's work has many merits but it would benefit considerably if the author gave an integral and brief presentation of his views. This would be rather reasonable because the theoretical part of his concepttion is rather non-uniform. Some points (e.g., Hero and Democracy) are examined very extensively, but still there are important subjects that are insufficiently or even scarcely elaborated (e.g., why in certain epochs great men abound and in other periods they are few; what determines
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the scale of individual's influence, i.e. under what conditions an individual could change not only the development of his own nation but of the world as a whole). After the publication of Hook's book the study of the problem was not dismissed, but there were quite few original conceptions, and it is better to say that the variations of the existing theories continued to develop with the application of new scientific methods and data. There was a lot of criticism of determinism (see, e.g., von Mises 1985 [1957]), sometimes quite witty and profound like in Aron's works (1948, 1961, 1965) (see also below). Traditionally Marxist authors as well as some active critics of Marxism trying to develop on its basis an alternative theory15 paid more attention to this problem and also such authors of the 1920s and 1930s as Trotsky, Kautsky, Gramsci and later few Soviet authors made some valuable amendments to this question. Perhaps, to the highest degree (though in a form absolutely discordant with traditions of historiography) the problem is analyzed in so-called counterfactual or alternative history (see below). Among quite a few attempts to develop a theory of the role of individual, I would like to mention an article by a famous polish philosopher Leszek Nowak Class and Individual in the Historical Process. Nowak attempts to analyze the role of individual through the prism of a new theory of classes within the framework of created by him nonMarxist historical materialism. It is valuable that he tries to analyze the role of individual in a wide context of the historical process, develops models of a person's impact depending on the political regime and societal class structure. In general Nowak thinks (however groundless) that the role of individual, even of an outstanding one, is not that large. At the same time, rather interesting and correct, although not quite new in principle, is his idea that an individual himself is unable to significantly influence the course of the historical problem unless this individual finds himself at the node of some other factors-parameters of the historical process (Nowak 2009: 82). It is worth noticing Arthur Danto's approach. He recognized the importance of the individual in history. However he (following Kautsky and some
15
Among the latter one can point, for example, Leszek Nowak (see below).
European and American sociologists) recognized that the individual has to accumulate strength of masses and corporations. In this respect Danto extended his definition to include social individuals, which he defined as individuals we may provisionally characterize as containing individual human beings amongst their parts. As examples of social individuals one may set social classes, national groups, religious organizations, and even large-scale events, large-scale social movements, etc. (see Danto 1966: 266). During the last decades one can trace the following main trends in the problem research: 1. Consideration of the problem of an individual's role as a part of general theory of driving forces and laws of history and other investigations. Among the authors who quite actively analyze the problem of historical laws one should mention such philosophers as Dray (1963), Danto (1966), Hempel (1963), Mandelbaum (1963), Nagel (1961), Popper (1966),16 Stern (1964), Walsh (1992).17 In the course of their studies they to a certain extent (but on the whole quite briefly and partially) touched upon the question of the role of an individual in history, but the discussion did not go beyond determinism and antideterminism frames. In the 20th century it became absolutely clear that social systems can have various qualitative states which determine many of its characteristics. Certain interesting remarks on the differences in the intensity of an individual's influence for various states of society's stability (stable and crucially unstable) can be found in the works by Gramsci (1971 [1929 1935]), Labriola (1986 [1896]), Nehru (2004 [1934]), Gurevich (1969) and others. As has been shown above, although Hook did not connect the change of the individual's influence upon a society with the state of the latter, he, nevertheless, considered alternatives and choice to be of the greatest importance, which quite often, but not always, corresponds to the unstable society's state.
16 17
E.g., in the Afterword. Ch. 25. Has history any meaning? They held some discussions on the laws of history in the late 1950s and early 1960s. In the framework of this discussion some ideas about the role of an individual were expressed (in particular, concerning the motives for historical personalities' actions and the correlation between motives and results of those actions). Some of the most interesting articles (of course, not surprisingly) were published as a volume edited by Sidney Hook (e.g., Dray 1963; Hempel 1963; Mandelbaum 1963).
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The examination of the role of an individual in various situations, the idea that the historical role of an individual may vary from the most obscure to the most colossal depending on various conditions and circumstances, and also on the peculiarities of historical place and time and personal qualities of an individual will be considered in detail below. The role of outstanding people is widely known in the process of state formation, the creation of religions and civilizations; the role of individuals is widely recognized with respect to spiritual culture, science, discoveries. In this connection it is necessary to mention Arnold J. Toynbee's theory of the creative minority (Toynbee 19341961). One can also say that some neoevolutionists sometimes have interesting ideas about the role of individuals in the formation of chiefdom and state (e.g., Claessen 2002; Carneiro 2002; Miller 1976; Grinin 2004a, 2011a, 2011b). The question of the role of certain individuals in the process of state formation and evolution is exceptionally important and interesting, and it vividly illustrates the importance of the theoretical development of the problem of the individual's role. Unfortunately, there is no possibility to dwell on this aspect within the framework of the present chapter. But it is worth mentioning that at the origin of almost any early state or large political formation like early state analogue (see Chapter 3; see also Grinin 2004a, 2007h, 2011b) one could always find one or another outstanding personality.18 2. The involvement of methods and theories of interdisciplinary trends. In the 1950s and 1960s one could finally observe the development of a system approach, which potentially gave an opportunity to take a new
18
It is especially evident in the process of quite rare occasions of state formations in nomadic societies, as they have fewer objective conditions for this than settled civilized farmers. Even big polities were formed by nomads only a few times in history and the Mongol Empire should be regarded as an exception (Barfield 1991: 48). That is why the formation of Genghis Khan's Empire and moreover its military success cannot be considered apart from Genghis Khan's personality. Meanwhile, Genghis before proclaiming himself a chief Khan avoided death in a miraculous way three times, and moreover once he was pursued by 300 horsemen (Khara-Davan 1996: 105). Had he died and a giant empire would not have emerged. On the other hand, it is clear that energy and outstanding qualities are not sufficient for a success and especially for the institutionalization of the situation of state formation. Thus the examples of Ariovistus (the 1st century BCE) and Maroboduus (the second half of the 1st century BCE the first half of the 1st century CE) of Germanic peoples who organized quite powerful in political and military aspects polities (see for detail Grinin 2004a: 97) show that sometimes such leaders due to their qualities and abilities to benefit a situation are able to create big political formations. But if there are not any deep reasons for state existence such unions will collapse.
glance at the role of an individual (see, e.g., Bertalanffy 1951, 1962, 1968; Mesarovi 1964; see also Grinin and Korotayev 2009a: 1618). But complexity-studies appeared to be of more importance here. Though specialists in complexity-studies paid little attention to the problem of individual's role (though here one should mention Borodkin, e.g., 2002), nevertheless, due to the fact that complexity-studies in some aspects significantly developed and broadened the understanding of the systems' behavior, it also gave some opportunities for extending the comprehension of the problem of the role of an individual in history. In simple terms, complexity-studies define two main states of a system (including that of a society): order and chaos. In the state of order society does not allow a significant transformation, if it develops then only in a certain direction. In spite of negative associations, chaos often gives a possibility for a system to pass onto another state, which can imply both higher and lower levels. Since the system/society is in a very unstable position, when main connecting ties/institutions are weakened or destroyed, then there appears a special state a bifurcation. At this point of social bifurcation (revolutions, wars, reorganization etc.) a society may turn into one or another direction under the influence of some generally insignificant reasons. It is important that the direction and the level of transition depend to a large degree on the individuals heading the movement.19 3. Quite actively, especially in the last decades, there has been developing so-called counterfactual history which examines hypothetic alternatives within unreal scenarios. For example, under what circumstances could Hitler and Germany have won World War II (Alexander 2000); what would have happened if Churchill had died in 1931 (Murray 2000) or Napoleon had won the Waterloo (Trevelyan 1972 [1932]; Carr 2000) etc. Thus, in the focus of this investigation trend there often stands a figure of a prominent historical personality and the important question is discussed: what would have happened if some individual had not been alive (or vice versa if he or she continued living). Though at first sight such researches seem to be inappropriate for histo19
In connection with the above-said even Prigogine and Stengers' incidental idea that with the existence of different historical personalities the same social and historical mechanisms could produce a different history (see Prigogine and Stengers 2005: 50) seems interesting from a methodological viewpoint.
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rians, nevertheless, they allow playing various alternative scenarios, which, firstly, make it clear that historical events are not predetermined and, secondly, clarify the reasons why this or that tendency (represented by one or another individual) has won. It also gives an opportunity for wide generalization. First works in this sphere were written already in the 19th century, e.g., Geoffroy-Chateau's book (1836) that focused on Napoleon passing on a Russian attack and instead going on to conquer the world.20 Sidney Hook attached great importance to the research of such potential alternatives, which he considered to have a great depth of meaning and even devoted a whole chapter called If in History (Hook 1955: ch. VII), where he discussed a range of such if, in particular, what opportunities would another US president (not Hoover, but Roosevelt for example) have had before the crisis in 1929. The problem of if in History was paid tribute by such a prominent historian as Toynbee. Recently William R. Thompson has presented an interesting paper on the subject (2010). Section 2 The second part of the chapter presents the author's approach to the problem of the role of individual in history, in which the ideas generated in the process of the problem analysis are synthesized to the maximum and the solutions, procedures and notions are suggested helping to make the analysis of the role of individual more operational and also to show in which particular periods, how and why the role of individual increases and decreases (see also Grinin 2007d, 2007e, 2008b, 2010d). 1. GENERAL APPROACHES 1.1. Dialectic difficulties of the problem and the general scheme of the approach to its solution As we see, within Plekhanov's antinomy, the problem of the role of an individual seems unsolvable, because both determinist and non20
It is worth mentioning that Napoleon is ever since the most favorite personality in countrafactual history (see, e.g., Trevelyan 1972 [1932]; Carr 2000). Among popular personalities are also Hitler and Stalin (see Alexander 2000; Montefiore 2004).
determinist heroic-contingent approaches are greatly erroneous but still have some just points. From the determinist viewpoint, i.e. if we take for granted that an ahistorical force (God, fate, implacable laws, etc.) exists in reality, it would be logical to consider individuals merely tools of history, who only help to realize the already existing potencies or, moreover, an initially prescribed program. However, as we have seen, on the whole the determinists' arguments do not withstand criticism. Too many things and phenomena are personified in history and that is why quite often the role of the individual turns to be exceptionally significant. The role of individuals and incidents in historical events is the first and immediate element; and those who deny this role must prove that they are right Raymond Aron added reasonably (Aron 1948, 1965; 1993: 181). However, it is evident that the role of the individual is determined by a great number of various factors, including social structure and particular situation; it is worth mentioning that some periods (sometimes, quite lengthy) give few outstanding personalities, while in others (sometimes very short but violent) they abound; and it is absurd to ignore that sometimes highly capable people lose, while nonentities produce a colossal influence on their contemporaries. It is evident that a figure's significance depends not only on his or her personal properties but also on the situation in which he or she acts; and therefore, Carlyle's statement that the history of the world is but the biography of great men do not clarify the situation. Hegel stated not without reason that heroes only appear to draw the impulse of their life from themselves; and whose deeds have produced a condition of things and a complex of historical relations which appear to be only their interest, and their work (Hegel 1935 [1837]: 29). On the other hand, however, it is just the leaders' activity (and sometimes even that of some ordinary people) that determines the outcome of confrontations and the fate of different tendencies at crucial periods. However, even an average approach that a personality is both a driver and a product of historical development (Rappoport 1899: 47) does not make it possible to find a satisfactory or, moreover, a profound solution to this problem (see also Hook 1955: 19). In our opinion, the way for its solution consists in switching from the abstract level to concrete methods and conclusions. This work was initiated in the late 19th century by Plekhanov, James, Kareyev, Labriola, etc. But it would usually stop at the first or second stage of those procedures. The main thing is that the aim of such methods development was
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not set. Let us illustrate this with the example of Plekhanov's idea. He writes that the role of the individual and the limits of his or her activity are determined by the society's organization and that the character of an individual is a factor in social development only where, when, and to the extent that social relations permit it to be such (Plekhanov 1956: 322). There is a grain of truth here. Still what are the limits to the individual's possibilities in case the social relations allow him or her to become a factor of such development? If the society's character permits freedom of arbitrariness (a wide-spread case in history) then Plekhanov's statement does not work. In such case the development may quite often become much more dependent on the wishes and personal properties of a ruler or dictator who will concentrate the society's forces in the course he or she considers important. As it has been mentioned above, Hook made an important step to clarify some aspect of the problem. However, he failed to present his concept as a whole. There are many methodological as well as ontological aspects which are necessary to discuss in complex. At the first stage of analysis we suppose that it would be right from the methodological point of view to present the issue of the personality's role as a particular (although a very specific) case of the problem of driving forces of historical development. Within the framework of the theory of driving forces (see Grinin 2007e; Grinin and Korotayev 2009a) the individual is one of the most important ones. But a personality acts together with other driving forces and, depending on their values, increases or decreases its own significance (and, vise versa, the significance of a personality increases or weakens other factors). At the subsequent stages we will try to analyze and systemize reasons and conditions which increase or reduce the personality's significance including the peculiarities of historical time and concrete moment. The next step of the analysis is to formulate the general principle although rather expandable and imprecise but still outlining a range of search of solutions. Depending on different conditions and circumstances and with regard to characteristics of the society under study, time and individual features of a personality, the historical role of the latter may vary from negligible to the greatest. This idea helps find a tangency point for different opinions and reduce them to a com-
mon denominator. But the specified general principle should be expanded and made concrete in theory with the adherence of the required rules of correspondence and procedures. 1.2. On the typology of roles in history. Who can be considered an outstanding personality? First of all, it is necessary to define which role is actually implicated. As we have seen the role of an individual has long been reduced only to its progressive (or negative) effect. However, this is clearly insufficient. Apparently, it would be advisable to outline the typology of roles. In our opinion, it is as follows. 1. By the time of impact: either at the moment of the action or later but during the actor's lifetime; or after his or her death, even many years later. 2. (Close to point 1) Direct and indirect. For example, with respect to the October Revolution, Lenin played a direct role, while Marx an indirect one. 3. Presence or absence of an individual. For example, the fact that Tsar Feodor Ivanovich (15841598) had no heir led to the disappearance of Moscow tsars' dynasty (the Rurik Dynasty), to Boris Godunov being elected the tsar, to the emergence of impostors for the Tsardom, False Dimitriy I in 1604, and the Time of Troubles. On the other hand, in 1613, the just very presence of the elected Tsar Mikhail Romanov, although inactive at first, radically changed the political situation. 4. (Close to point 3) Active or passive. For example, Alfred Dreyfus, a Jewish artillery officer charged of treason and convicted in France in 1894, played himself a passive role but Dreyfus affair became a political scandal that split France in the 1890s and the early 1900s. 5. Planned or unplanned. This point is important as many impacts had not been planned or even imagined but just these very impacts often became the most important. 6. The presence or absence of choice. Sometimes, the main point is to do something, because it is clear what should be done but there is no figure to accomplish this. For example, in 16101611, the Russians knew that it was necessary to force the Poles out of Moscow, but only Kozma Minin and Dmitri Pozharskii managed to accomplish this. Joan of Arc played the similar role. In other cases, the main point is to determine the way of development.
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7. By forms of activity, because what is favorable for some spheres is unfavorable for others. 8. Progress or reaction. All other conditions being equal, still one can say that it is easier to play a negative role than a positive one: no special abilities are required to hinder, prevent, or bring something to a crisis; while to create something new, they are almost always necessary. So the notion of Great Man used to be applied to latter cases, but among individuals playing negative roles there are many, borrowing Hooks' term, eventful men. 9. The degree of novelty. 10. Interchangeability of persons. Of course, such figures as Caesar or Napoleon were unreplaceable, but did, e.g., Prussian Generalfeldmarschall von Blcher, Napoleon's victor, belong to that category? 11. By the character of actions: individual or within the framework of an organization, state. 12. Other. Of course, we have mentioned but a few types of roles. Besides, a real figure can perform not one but several roles at a time. On the basis of the presented list it is clear that the level of intelligence, talent or personal qualities (including moral ones) of historical personalities has a huge amplitude, i.e. one must not speak only about people of genius or talent which was typical of the past time authors. If only the result of historical actors' activity/inactivity is taken into account, irrespective of their individual features and goals, we may agree with Kautsky that outstanding figures do not necessarily mean geniuses. Both mediocrities and those below the average level, as well as children and idiots, may become historical figures if they have great power (Kautsky 1931: 687). Thus unfortunately far not always the role of individual is proportional to the individual's intellectual and moral qualities. Our approach concerning who can be considered an historical figure may be generalized as follows: owing to his or her personal features, or to a chance, or to his or her social standing, or to the peculiarity of the epoch, an individual by the very fact of his or her existence, by his or her ideas or actions (or inaction) directly or indirectly, during his or her lifetime or after his or her death may have such an influence upon his own or another society which can be recognized significant as they left a noticeable mark (positive, negative or unambiguous) in history and in the society's further development.
Further, we should define the criterion of distinguishing between ordinary and outstanding individuals. As we have seen, in response to the dramatic opposition of an creative personality and inert mass, the sociologists of the late 19th early 20th centuries, for example, Mikhaylovsky (1998), Kareyev (1890, 1914), Kautsky (1931: 696), and others turned towards blurring the boundaries separating outstanding individuals and the masses. In particular, it has often been noted that history is made by all individuals rather than by concrete outstanding personalities (Kautsky 1931: 696). But on the whole such an approach in the framework of the problem under study does not account for fundamental differences in the degree and intensity of the individual's impact on the course of events. Indeed, formally speaking, history is made by all individuals. But is it reasonable to speak about outstanding individuals if to equate them to the most ordinary ones? In fact, however, it would be an understatement to say that the role of the man in the street is small. His/her impact is either suppressed by other impacts or included in aggregate force (as a rule, without his permission or even contrary to his will). In case his/her action becomes important in some way, he is no longer an ordinary person. Thus, we believe there is a certain critical point in the individual's impact on society, beyond which this impact becomes noticeable. Of course, the definition of this point implies a number of difficulties, as in any dialectic process. 1.3. Some factors changing the scale of historical personalities' influence 1. In cases requiring only one person (e.g., a monarch, crown prince, commander-in-chief) or where this person defines the canons (a creator or reformer of an orthodox religion, such as Muhammad, Luter, Calvin) the role of the individual is much more important than in cases that imply alternatives (in science, culture, inventions, etc.), let alone the spheres where very many people are employed. Thus, there are always outstanding personalities in any business. But only few of them can be estimated as having such a significant role at the national and moreover, international scale that without them the economic development would have gone in a different way or they could not be somehow substituted by other businessmen although this would happen later or be worse. 2. As compared to monarchy, the democratic regime, on the one hand, gives opportunities to a greater number of people to show their
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worth, but on the other hand, it decreases the dependence of development on a personality on a benefactor and protects from exceeding adverse effect. However, great reformers in the times of democracy will be less common than under monarchy (on this subject see Hook 1955: ch. XI). 3. There are situations when one feels the lack of personalities and their timely appearance equals to a dramatic increase of the tendency. But it can be the other way round an intense competition among outstanding individuals and then it becomes of little importance who would be the one to perform the action and whether it would be done a bit better or worse, a bit earlier or later.21 The general conclusion is as follows: the fewer alternatives and real opportunities a society has to choose or substitute an individual (a less real competition for leadership) and the more responsible position an individual occupies, the more important is his or her role and the more dependent on the personal qualities a society is especially at the given critical circumstances. 1.4. An individual and the masses Mikhaylovsky and Kautsky (see above) correctly captured the social effect: the individual's power increases enormously when he is followed by the masses and even more when these masses are organized and united. But the dialectics of the relationship between an individual and the masses is substantially more complicated and one can observe a great variety of situations: starting with the one when the masses represent indifferent population easily manipulated by the authorities up to the situation when the leader acts as an exponent of the masses' spirit and cannot move a step from their will (for example, that kind was the king's dependence on the gentry in Poland in the 18th century). It is often the case that the possible emergence and the potential of the movement to come are directly connected with its leader's energy and luck. But much more often the state apparatus, elites and parties literally
21
For example, the priority of an inventor or scientist is often defined not in years or months but already in days and hours. The famous story of the rivalry between Alexander Bell and Elisha Grey in the priority of the telephone invention could serve as an example here. Bell's application for patent and Grey's patent caveat were issued the same day on February 14, 1876 but with the interval in several hours. But sometimes a short time period is extremely important as it becomes of utmost significance who is the first to do something. Thus, had Germany and not the USA been the first to create atomic bomb that would have had serious consequences.
launch leaders. This is characteristic of a monarchy with a correct procedure of succession (The King is dead. Long live the King!) and of developed democracy; in short, this is typical of developed stable regimes. Naturally, in case when the masses are inactive and an individual can guide them, the role of the latter increases dramatically. And then the direction of the common forces greatly depends just on the leader's features.22 On the other hand, the power and even the number of adherents are quite often proportional to the leader's ability to take the right steps and to understand and manage the situation. Comparing the role of the masses and individuals we can observe that on the formers' side there are quantity, scale, emotions, and the lack of personal responsibility. On the latter's side consciousness, aim, will, and plan. That is why one can admit that at other equal conditions the role of an individual will be greater when both the masses' and leaders' advantages join into a power. That is why the splits weaken so much the organizations' and movements' strength and the existence of rival leaders may bring it to nothing. Let us point out the role of leaders and individuals in the situation of clash of different political, military or social forces. As Gramsci noted In reality one can scientifically foresee only the struggle, but not the concrete moments of the struggle, which cannot but be the results of opposing forces in continuous movement, which are never reducible to fixed quantities since within them quantity is continually becoming quality (Gramsci 1971: 438). Hence, the leader's conformity with his role at a critical moment (battle, elections, etc.) is of decisive importance since as Labriola points out, it is just the complicated interlacing of antithetical conditions that causes the fact that at crucial moment the definite individuals, genius, heroic, fortunate, or mischievous, are called to say the decisive word (Labriola 1986). 2. FACTOR AND PHASE ANALYSIS 2.1. The factor of situation In the present chapter we aim at presenting a compound complex of factors related to the role of the individual in a conceptual system. For this purpose we indicate the influence of all typical causes in this context by the common notion of the factor of situation whose introduction suf22
As Theodore Mills notes there are situations, when a group of leaders can force their nation to a definite course of action (Mills 1967).
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ficiently increases the operationality of the analyses of individual's role. Here the word situation emphasizes that the intensity of the individual's role is not a constant but a variable determined by a combination of objective circumstances and personal features in particular historical place and time. In a different moment the value of this variable would be different. The situation factor includes: a) features of the environment where the individual acts (traditions, social system characteristics, goals of society, etc.); b) the state of society at a definite moment (stable, unstable, progressing, declining, etc.); c) characteristic features of surrounding societies; d) characteristic features of the historical time and general characteristics of a given period in the historical process (including the degree of social integration, development rates, etc.); e) the closeness of society to the World System's center or countercenter and the main path of the historical process, which increases or decreases the possibility to influence many societies and the historical process as a whole; f) the degree to which the moment is favorable for respective actions; g) personal properties of the individual in question and comprehension of the task; h) whether the historical moment, the task, the moment and the situation in question need just some definite personal properties; i) the presence of sufficient social (political, military and etc.) forces for problem solving; j) the presence of competitive persons; k) others. The above mentioned factors have been enumerated in a random manner as their importance may vary in different cases. If, for example, the individual's influence on the whole mankind is considered then items c, d, e are especially important; if we examine causes of a reform failure the items a, b, g, h, i, j are of greater importance. In general, the more factors favor an individual, the higher his or her role may be. 2.2. Some constituents of the factor of situation The frameworks of the present chapter only allow a brief discussion of some aspects of certain constituents, thus we will dwell in detail only
on the item b devoted to the phases of society's state and the fluctuations of the role of the individual at the change of these states. 2.2.1. Social order (item a). The modern model of the state differs much from the previous one, because it includes built-in regulators, which make it possible to reveal imminent problems and solve them before they result in social explosions. Such mechanisms limit the role of the individual in terms of his or her uncontrollable impact on society (see below). Different polities may have their pluses and minuses but on the whole one can point out that the more correct the separation of powers is carried out, the more secured the society is against the possibility of shattering its stability by the leaders or subverters. Thus, the system of checks and balances in the society's political organization and the presence of a system of built-in regulators and social policy decrease the excessive impact of personalities. 2.2.2. Now and before (item d). The role of an individual is directly connected with the forces which the society possesses at the moment and entrusts the individual. At the same time all the factors are interrelated and so the individuals' activity is inseparably linked with other driving forces and is in certain accordance with them. And just when a disproportion occurs, the role of an individual increases sharply and dangerously which, in particular, involves getting various technical gadgets. In ancient and medieval societies of monarchic-despotic type rulers had great possibilities of influencing a society especially if there was no mechanism of despotism restriction. But the point is that such great technical possibilities were absent at that time.23 No matter how great was Genghis Khan's or Batu Khan's aspiration to destroy a vast part of the mankind, their possibilities at any scenario were smaller than those of a modern maniac if he would get an access to a nuclear button. As early as a century ago nobody could affect the nature the way an ordinary specialist can do (on a giant tanker or at a nuclear power plant etc.).24
23
24
Leo Tolstoy called Nikol s II a Genghis Khan with cannons and telegraph. Fortunately the great writer could not even imagine what genghis khans with concentration camps as well as tanks and poison-gas and atomic bombs would come a short time later. In the 20th century it became evident that (ceteris paribus) the role of individual may increase to huge values if in one place there combine two tendencies: a personalization of power and rulers' permissiveness, on the one hand, and technical power of modernity plus the possibility through its use to influence the rest of the world, on the other hand. That was the case with the USSR, Germany, and Japan (see also Hook 1955). Differences in the individual's impact between the past and the present in some cases is expressed in the fact that today politicians know much more about different paths and patterns of development which often make the choice of this or that direction in some respects more de-
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2.2.3. The scale of a society or of the whole humankind (item e). In the former case the result is almost insignificant with respect to the world historical process, whereas for a society it can be of great importance. For example, a leader's failure may have fatal consequences (society may fall out of the race, become dependent, lose the tempo etc.). It is quite another matter when there emerges something brand-new not only for a society, but also for the worldwide process as a result of individual's activity (for example, a prophet of a new world religion, political revolution etc.). Here the stakes are much higher. For example, Christianity could have become so widespread exactly in multiethnic and quite tightly united Roman Empire. On the whole one can say that the role of an individual increases depending on the scene scale and the number of escape ways that evolution has. That is why globalization substantially increases the individual's role as long as the number of alternatives decreases and the speed of development increases. On the other hand, the less united the mankind is, the less is an individual's influence on it (this is particularly true in respect of the ancient periods of history). 2.2.4. The role of a favorable moment (point f). Since history is not programmed and at every moment one of potential scenarios among many is realized, in certain situations the chances of weak tendencies and on the whole the choice increase. Will there be actors capable of taking a chance and who they will be? Philosophers of the past used to say that if there was no one person then there should be another. As a matter of fact that would be the case if the situation could wait for a long time. But the matter is whether there will be a proper individual in the most favorable moment. Once you miss the chance and later even a much more talented individual would fail to do anything. The general level overgrows a certain stage and then the society has to catch up with others using not its own but others' models. And since the speed of history increases societies have far less time for experiments than before when history could be changed with civilizations emerging and being destroyed (see also Hook 1955: 149150). 2.2.5. Compliance with time and situation and the ability to realize a historical chance (points f, g). Indisputably, if there are no conditions, an individual is unable to create them out of nothing (that is why the most talented individuals vegetate in obscurity in dark eppendent on the personality (thus Mustafa Kemal Atatrk chose for Turkey the path of secular Europeanized state and the present Muslim leaders often choose Islamization).
ochs). The great epochs, transitional periods or those of change give different possibilities for an individual. But History does not always give total-lot chances for an actor. They are often uncertain, indistinct, disputable and really low. And it is far from always that even total-lot chance is used. That is why the way these possibilities will be realized ably or unskillfully is to a great extent the matter of the personality itself. And depending on whether the chance is realized or lost the course of events can change dramatically. With the account of the above said while giving an evaluation of an individual's significance (which also extends the idea of the limits of the individual's role in history in general) one can try to answer the question if anybody else could have done the same under existing conditions. Quite often we can answer in negative. What this person has done (significant or criminal, good or bad) has managed to concentrate nation's forces or to use any tiny chance, revealed unprecedented cruelty etc. is too much to bear for almost any person. Is not this also the reason of the charisma of Alexander the Great, Caesar, Napoleon and others?25 On the other hand, it is totally wrong to believe that great epochs give birth to great individuals right on cue. (Do not we experience the lack of outstanding politicians nowadays?) The tragedy of many epochs was the discrepancy between the leader and the tasks set by the time. And on the contrary, the appearance of a person who managed to take the occasion to lead the society away from the right path became the society's damnation. Thus, the existence of an individual more or less appropriate to social goals is a mere coincidence, not so frequent but more or less probable. 2.3. Society's state phases Although not all aspects and constituents of the factor of situation are taken into consideration, and moreover, in a complex, but still some scholars distinguish such an important aspect as state. In general two main states are singled out: 1) stability and endurance; 2) instability, i.e.,
25
The episode described by Plutarch vividly shows the difference between a man of genius and an outstanding individual. Alexander the Great asked for advice of retinue whether to accept the conditions of the Persians. Darius III long before the decisive Battle of Gaugamela was ready to make peace on some profitable for Alexander conditions. He was ceding the lands to the west of the Euphrates and promised a great indemnity. Permenion said: If I were Alexander I would accept the terms. I, too, by Zeus, exclaimed Alexander if I were Parmenion! and then he wrote an ultimate letter to the Persian king (Plutarch, Alexander, XXIX).
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chaos, revolutions, crises, and so on. Note that the second state opens much better opportunities for individuals' critical actions (see Labriola 1986; Nehru 2004; Gurevich 1969; Prigogine and Stengers 2005). Unfortunately it is mostly expressed in the form of accompanying and at times indistinct remarks without systematization and more or less detailed analysis. We have defined this statement as follows: the less stable society is, the more destroyed are the old structures, the higher is the individual's impact. In other words, the role of the individual is inversely proportional to the stability of society. However we suppose it is more efficient to single out not two, but four phases: two polar (firm stability and total chaos) and two transitive ones from stability to chaos and from chaos to a new form of stability. This helps to proceed to modeling. Besides, it is necessary to develop a typology of society states.26
THE ROLE OF AN INDIVIDUAL RISES
THE ROLE OF AN INDIVIDUAL INCREASES DRAMATICALLY
Fig. 2. Correlation between impact of individual on society and stability level of society
26
In particular, stability and, even more so, instability have many variants, each having its own characteristic features. For example, stagnation differs from stability under conditions of economic (territorial) growth: stability may be observed even under slow degradation or decline. Even in stable societies, much depends on the extent to which the social regime is oriented toward a definite political figure as we saw above in the example of Peter the Great. Variants of social crises are also diverse: reforms differ from revolutions, peaceful revolutions differ from civil wars, and so on. One should also consider the difference between modern and archaic states (see above).
2.4. Modeling of change of the role of an individual in various phases of society states To analyze the role of the individual, it is very important to present changes in society as a succession of its states (phases). Our model of this process takes into account four phases: 1) stable society of the monarchy/dictatorial type; 2) social pre-revolutionary crisis; 3) revolution; 4) the formation of a new regime (see Fig. 2).27 In the first phase in the course of a relatively quiet epoch the role of an individual is although significant but at the same time not so great (though in absolute monarchies everything concerning a sovereign may be of great importance and also in any state many aspects are dependent on a concrete person in power). But overall, such calm minor epochs are far less subject to the situation when a concrete individual becomes the creator of the epoch, either good or bad. In this case, the state of neighboring and other societies, which may undermine stability through military intervention, is more important. Natural calamities and outbreaks may produce similar impacts. Eventually, the regime will begin to decline. The contradictions sharpen inside it, particularly heated up by borrowings in technology and machinery, advanced relationships and laws in certain spheres. There emerges a movement for reconstruction. It is a great piece of luck if there appears a person who is able to lead society to peaceful development. The second phase starts when the system is tending to decline. The country is on the threshold of social-political explosion. Whether it will be set off or not depends on many factors, including the individuals' strength on one side and the other. Delays in solving problems that are dangerous for the authorities can result in a crisis and the desire to change the situation through violence. Many individuals of messianic type appear, ready to undertake the society reorganization in various ways from a reform to a revolution. There emerge several alternative pathways of development which are not only supported by various social-political forces, but also are represented by personalities. And these individuals' peculiarities and luck determine to a greater or lesser extent where the society may turn to.
27
This is only one of the possible models; there are others, for example, stability crisis reform, stability crisis revolution counterrevolution, stagnation without crises reform development (or decline), development reform development, and others.
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Together with that on the scene there appear some concepts and schemes of country and world reorganization, of injustice elimination, and so on. Alternative possibilities (trends and directions) of society development do not only acquire here a more clear class and group expression, but also find their apologists, leaders, and precursors, etc. The monarch's responsibility, in case he drives society to explosion, is measured to a greater extent by the damage caused by the revolution or, on the contrary, by the positive effect it produced on the future state's destiny.28 In such an epoch, vivid personalities are more characteristic of destructive forces. However, these are often narrow-minded, uncompromising and sometimes fanatic people. But talented persons may also appear among conservatives, who are concerned with the imbalance. Pyotr Stolypin in Russia and Jacques Turgot in France exemplify this (although exactly the individuals of this kind are often not wanted and therefore their efforts often do not succeed). It is a piece of luck if such a leader manages to blow off steam and change the country by peaceful means. However, this is rarely the case. Crises are crises just because narrow-minded and stubborn people bring the situation to a deadlock. The third phase starts when the regime does die under revolutionary pressure. When society starts to solve long-standing global problems accumulated by the old regime, it never has a ready clear solution. This is impossible for many reasons because every class, group and party has its own solution to the problem and the struggle of parties, individuals and ideas only reinforces such a variety of alternatives. Some tendencies surely have more, some have fewer probabilities to be revealed, but this correlation may be sharply changed by the influence of various reasons.29 During such critical periods, leaders sometimes play the role of weights that can turn the historical scales.30 No doubt that an exceptionally strong will of power of Lenin, Trotsky and others played a remarkable role
28
Everybody is responsible for revolution and mostly are responsible the reactionary forces of the old regime. Revolution always tells that the people in power have not fulfilled their function (Berdyaev 1990: 258). 29 That is why not only a more powerful social force wins, but the very power of this force depends on who is in charge of it. It is quite similar to the results of the battle where a successful commander with comparatively small troops suddenly defeats the bigger ones. 30 As long as the particular interests of the different social groups are in such a state of tension, that all the parties in the struggle reciprocally paralyze each other, then to make the political gearing move, there is need of the individual consciousness of a definite individual (Labriola 1986: 183). See also Hook 1955, especially ch. X devoted to Lenin.
in getting and holding the power by the Bolsheviks. Should Lenin have not managed to come back to Russia from Switzerland and there would be no doubt that the destiny of Russia would have been more prosperous. Consequently at certain moments individuals' power, their personal qualities, compliance with their role etc. have great, often crucial significance. This volitional factor, which is often irrational and subject to incidental impacts, may be favorable but at the same time very dangerous; hence, it is much better to have stoppers within society to restrict such impacts. Such explosions give many opportunities for various evolutionary variants of development. The only problem is that the trial-and-error method in history requires millions sacrifices of those who had bad luck. After the maximum destruction of the old system, when the ties binding the society are broken and the firm constructions are destroyed, society becomes amorphous and, consequently, very vulnerable to force impacts. During such periods, the role of individuals may be uncontrolled and unpredictable and serve as the forming factor for an immature society. This is also connected with the fact that in the process of hard struggle for getting and holding power under the influence of numerous needs and personal ambitions there are sometimes created such social forms that nobody has planned or could ever plan. It is important that these per se accidental phenomena become such an entity that can quite often define the future organization of a renewed society. As a result, having acquired some influence the leaders transform society into a previously unimaginable system and invent a perfectly new social construction (although limited by geographical and other conditions that nobody can ignore). At such crucial epochs the role of an individual is huge but this role and especially its further influence appears to be nothing of the kind this individual has supposed (and sometimes entirely different). The fourth phase starts (sometimes quite quickly) when the creation of a new system and regime begins. After a political force has come to power, the winners may begin struggling against each other. Such a struggle is connected with both personal relations among the leaders and the choice of the future path of development. The role of the individual in this respect is also extraordinarily high: a new society has not obtained its final form yet. So a new system may associate its expectations with this particular person, prophet, leader, and so on. After considerable changes in social regimes, society noticeably polarizes. A popular person, such as the leader of a revolt or the head of the win-
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ners' party, becomes a sort of a banner. To consolidate power, he or she has to liquidate all remaining political competitors and prevent competition on the part of his or her followers. What kind of person the leader is and the basis of his authority within the movement affects many aspects. The death of this person extremely sharpens the struggle in the winners' camp. This continuing struggle (whose duration is determined by many factors) is directly connected with characteristic features of the winning individual and finally shapes the society in question. It is clear that these transitional epochs often end with personal dictatorship which merges the leader's aspirations and the embodiment of various achievements in his personality as well as the society's weakness etc.31 Thus, the character of a new system depends much on the leaders' merits, on the peripetias of the struggle and on other, sometimes casual things. This is the reason why as a result of changes a society appears completely different from what has been planned. Gradually, the hypothetical system under review matures, forms, becomes increasingly stronger, and develops its own laws. After this maturation, laws begin to determine leaders. Philosophers of the past expressed this idea aphoristically: When societies come into being, leaders create institutions. Later, the institutions produce leaders. As long as the regime is strong enough or, moreover, if it develops at least in part, it is very difficult and often impossible to change it. If society again enters the phase of stability without having acquired regulators of crisis-free development, the cycle may repeat in its basic features or favorable changes will occur at some stage. *** As a conclusion it is necessary to repeat once again that the problem of the role of an individual in history for every generation is always relevant and is solved in a new way. That is why in our opinion it is unfair to refer it as having no current importance. There is a serious necessity to get back to the analysis of the problem of the role of an individual in history with regard to new achievements in historical science and new scientific means.
31
All revolutions end with extreme conservatism. It is inevitable. It is a law (Berdyaev 1990: 29).
Chapter 3 The Evolution of Statehood
1. THE BEGINNING OF POLITOGENESIS We start this chapter with the analysis of macroevolutionary processes that took place during the very prolonged late archaic and early civilization periods. During that period there was outlined the separation of political sphere from society including the beginning of specialization in the field of political management which in fact can be considered as the origin of politogenesis. However, the process of such separation was long-lasting and incomplete; it was finished only during the period of more or less formed statehood. Thus, the politogenesis is much older than the statehood. We define politogenesis as a process of formation of a distinct political aspect within the social system that leads to the emergence of partially and relatively autonomous political subsystem, a process of the formation of special power forms of societal organization; this is connected with the concentration of power and political activities (both internal and external) under the control of certain groups and strata. Nevertheless, it should not be supposed that politics emerges only with politogenesis. Politics is much older. Politics as a realm of relations concerning the distribution of power (Smelser 1988) seems to have appeared around the age of the Upper Paleolithic Revolution. Actually, certain elements of quasipolitical relationships may be already found among the non-human primates (see, e.g., Dol'nik 2007 on complex and dynamic hierarchical relationships among the baboons; see also, e.g., Butovskaya, Korotayev, and Kazankov 2000). However, among nomadic hunter-gatherers the power systems remained mostly very little differentiated and weakly integrated; on the other hand, the level of their differentiation and integration more or less correlated with their demographic indicators.
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The power was mostly based on the age and gender stratification, as well as on the leader's personal qualities and authority, his ability to secure for his community a more or less acceptable life (this was also frequently observed among the early agriculturalists, especially among the semi-nomadic ones [see, e.g., Lvi-Strauss 1955]). However, even among the ethnographically described nomadic huntergatherers the important differences in complexity of their socio-political organization were observed. While the majority of the ethnographically described non-specialized nomadic hunter-gatherers were acephalous and egalitarian, some of them (first of all, most of the Australian aboriginal communities) were non-egalitarian (Woodburn 1972, 1979, 1980, 1982, 1988a, 1988b). They demonstrated a sufficiently different type of socio-political organization with a much more structured political leadership concentrated in the hands of hierarchically organized elder males, with a pronounced inequality between males and females, as well as between elder males and younger males. Among specialized (higher) hunter-gatherers and fishermen of Siberia, the Far East, Kamchatka, Alaska, the Aleut Isles, North-West and South-West America one could find rather highly structured forms of hierarchical sociopolitical organization that were sometimes even more pronounced than among many early agriculturalists (see, e.g., Townsend 1985; Averkieva 1978; Dauns 1978; Freihen 1961). However, such an evolution was to a certain extent a dead-end as it could have only occurred in especially favourable environments and failed to diffuse to other cultures existing in other environments. The Agrarian Revolution (or, to be more exact, its first phase connected with the transition to primitive agriculture and animal husbandry [Grinin 2003a, 2006e, 2007b, 2007i, 2007k; Grinin and Korotayev 2009a]) opened a period of deep sociodemographic changes. As regards the subject of the present chapter, it is important to note that the increase in the population and population density (as well as settlement/community sizes) tended to lead to the increase in the significance of political, i.e. power, relations both within societies and in intersocietal interaction, including military interaction). Thus already at this macroevolutionary level it appears possible to speak about protopolitogenesis. However, in order that such societies (exemplified in the ethnographic record by most of the traditional sociopolitical systems of New
Chapter 3. The Evolution of Statehood
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Guinea) could evolve toward more complex organizational forms, they had (to use Burdeau's [1966] metaphoric expression) to cure the power from the impersonality paralysis of primitive stupor, to develop an institution of chief or its (sometimes democratic) analogues. Hence, the formation of the first polities reaching complexity level of chiefdoms and their analogues was one of the most important macroevolutionary shifts. Alternative social evolution, uneven rates of change and development of various social subsystems, various combinations of internal and external factors all led to a greater variety of pre-state societal forms and relation types. Among them are: more or less centralized polities headed by a chief appeared, as well as self-governed cities, poleis, temple and large rural communities; decentralized chiefless tribes; various complex acephalous sociopolitical systems, etc. Population size of medium-complexity systems can vary greatly from several hundreds to dozens of thousands. However, for more or less centralized or compact entities like simple chiefdoms, small temple-civil communities etc. the variation is smaller, from hundreds to thousands. On the whole we rely on Earle's estimates of a chiefdom population within centralized regional structure being in the range of thousands (Earle 1987, 1997, 2011; Johnson and Earle 2000; see also Carneiro, e.g., 1981). However, some chiefdoms with population of thousand or less are known as well, such as typical simple Trobriand chiefdoms (Johnson and Earle 2000: 267279); chiefdoms in some Polynesian islands (Sahlins 1972a [1958]: 8587, 188190) or Cherokee chiefdoms (Service 1975: 140 144 [for more detail concerning the forms and size of pre-state polities see Grinin, Korotayev 2011]). We tend to speak about the politogenesis proper starting from the level of medium-complexity societies. However, within most of such social systems the need in systematic professional administration was very weak, or absent, whereas the functions of central power may be performed by various alternative subsystems. It was not infrequent when even irrigation works were conducted independently by village communities without any interference on the part of chiefdom leaders or any other supracommunal rulers (see, e.g., Claessen 2004: 79; see also Leach 1970). The emergence of chiefdoms usually involved a transition to a higher level of not only political but also general social complexity. And this
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puts the given evolutionary type of medium complexity polities in a special position. In some respects, the emergence of chiefdoms can well be regarded as the leading line of politogenesis. However, this can only be done with very serious qualifications. The point is that no political systems developed in isolation, every political system experienced certain transformations under the influence from outside. What is important is that many primary, secondary, and tertiary early states emerged on the basis of various polis, civil, temple, civil-temple, trade-craft (and so on) communities, just a fraction of which can be regarded as chiefdoms. Chiefs acted as the leading force of the state formation only in some cases, whereas in the other cases these were some other agents (priests, aristocracy, oligarchic groups, democratic leaders, and so on). As regards the social systems in the medium complexity range, we must note that the urban/communal type of politogenesis was even more ancient than politogenesis through the emergence of chiefdoms (see Korotayev et al. 2000; Grinin 2009a, 2009b, 2011a; Grinin and Korotayev 2009a: Ch. 6; 2011; Korotayev and Grinin 2006). Basing on the aforesaid we believe it makes sense to subdivide all the diversity of the medium complexity polities (in view of a special role played by chiefdoms in the political evolution) into two major types: (1) chiefdoms/chiefdom-like polities and (2) chiefdom analogues. Chiefdom-like polities can be defined as hierarchically organized and relatively centralized medium complexity polities possessing the following characteristics: a) population in the range of several hundred to several thousand; b) political autonomy; c) they are led by a recognized and stable chief/leader or group of leaders who wield power in the framework of certain traditions and procedures; who are able to exercise real control over certain important social relationships and resource flows; who have influential support groups organized around them. Chiefdom analogues, that can be defined as polities or territorially organized corporations that have sizes and functions, which are similar to those of chiefdom-like polities, but that lack any of their other characteristics, such as high levels of hierarchy and centralization, presence of formal leader, organized system of resource control,
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political independence,1 and so on (for more detail see Grinin, Korotayev 2011). Such a subdivision of mid-complexity polities into chiefdoms and their analogues emphasizes that chiefdoms are not the only type of midcomplexity polities (yet, in the meantime it indicates their special evolutionarily position); demonstrates the diversity of evolutionary alternatives to the chiefdoms; allows classification of mid-complexity polities that do not fit the chiefdom definition even if there are doubts regarding the exact type of polities to which they belong. The formation of the first archaic states and their analogues (i.e. stateless polities comparable with archaic states see below) became another extremely important shift. So during the analyzed late archaic and early civilization periods two major shifts took place, i.e.: a) the formation of more or less institutionalized political subsystem, starting from the complexity level of chiefdoms and their analogues; b) the formation of archaic states and their analogues with further institutionalization of the political subsystem.2 We have denoted this whole epoch as the epoch of the initial (or primary) politogenesis (Grinin 2009h; Grinin and Korotayev 2009c). We define it as initial because the politogenesis had not stopped with the state formation, but continued further with the evolution from the early state to the developed one, and even from the developed state to the mature one (see Grinin 2008a, 2010a; Grinin and Korotayev 2006; 2009a: see ch. 5). Respectively, the epoch of primary politogenesis may be subdivided into two epochs: 1) the one starting with the formation of chiefdoms and their analogues, which we denote as the period of middle-complex societies or the pre-state period (Grinin, Korotayev 2011); 2) the one covering the formation and development of the early states and their analogues, which we denote as the period of complex societies or early state period (Grinin 2011a).
1 2
This is relevant for such chiefdom analogues as corporations etc. (see below). Such major macroevolutionary shifts that open a new direction of development to numerous social systems are denoted by us as social aromorphoses (for more detail see Grinin, Korotayev 2009a, 2009b, 2009c, 2011).
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So the state formation process proper is regarded as a constituent part of the general politogenetic process. 2. ABOUT THE VIEWS ON THE ORIGIN OF STATE The question about the origin of the state has been highly debated for more than two centuries (for detail see Grinin 2010a, 2011c). Production (Wittfogel 1957), trade (Webb 1975), and military (arneiro 1970, 1978, 1981, 1987, 2002, 2003) theories are sufficiently popular at present. Elman R. Service's theory of mutual profit (Service 1975) also has its adherents. Service is of the opinion that, owing to the complication of economic and other functions of power, the rulers and the subjects were increasingly interested in mutual services and, hence, gained profit from strengthening power. F. Engels's theory that views the state as a special apparatus of violence to defend the interests of economically dominant classes and suppress exploited classes (Engels 2010 [1884]) is still advocated by many Russian scientists. A number of foreign social scientists also share these ideas (the so-called conflict theory of the origin of the state), although in a significantly modified form. For example, in the opinion of Morton H. Fried (1967), the state originated as a result of a long process of social stratification and the elevated struggle for control and resource distribution. However, all the above theories are open to criticism. The majority of scholars justly tend toward the idea that a combination of different factors (production needs, conflicts between social strata, wars, and many others) was typically present in this highly complicated process. Probably the most reasonable remains Claessen's theory which takes into account several most important factors in their interaction. According to Claessen, to make evolution of early state possible a complex interplay of a number of factors is needed, varying from population growth, the production of a surplus and an ideology which explains and justifies the increasing division of power. Moreover, some incentive seems necessary to trigger the developments (Claessen 2010).3 According to Claessen such triggers include different events (e.g., when
3
In other works Claessen spoke about necessary condition in some different order: societal format, covering the number of people in relation to the means of production and the area of land available, domination and control of the economy, ideology (see Claessen, van de Velde, and Smith 1985; Claessen and van de Velde 1987; Claessen 2000a, 2000b, 2002, 2004); and some trigger event, due to which the process starts up (Claessen 2000b: 155; 2002, 2010).
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vital resources control in hands of certain groups makes them masters of the situation; enlargement of the settlements due to threat of attack), but to our mind, here he underestimates somewhat the role of the military factor.4 Great difficulties with the analysis of the causes of the emergence of the state appear due to the fact that many researchers implicitly tend to the unilinear evolutionary schemes whereas the evolution should be considered as a multilinear one (for detail see Grinin 2011b, 2011c; Grinin, Korotayev 2009c, 2011; Bondarenko, Grinin, Korotayev 2004, 2011). The transition to a new level of complexity is inevitably realized in the bundle of models and forms. They can, on the one hand, be considered within a horizontal dimension as equal versions of the same complexity level, and on the other hand, can be analyzed within the evolutionary vertical dimension. So theoretically, one may detect main and collateral development lines of social evolution (see in detail Grinin 2003a, 2004b, 2011b, 2011c). But it took the new organizational principles a rather long time and a few generations of polity types to prove their advantage because possessing an evolutionary potential does not mean to have advantages in a concrete historical situation. Quite often it was just the other way round. Over entire epochs the evolutionary models coexisted and competed with each other (yet being mutually complementary), whereas in particular ecological and social niches some collateral pathways, models, and versions could well have turned out to be more competitive and adequate. We proceed from the assumption that complex chiefdoms, early states, and different other societal types (large confederations, large self-governed civil and temple communities etc.) which will be discussed below, should be considered as standing at the same evolutionary stage, which could be defined as a complex societies or early-state stage. The transition to it by definition cannot be fulfilled but in a very extensive variety of forms, developmental trends and combinations. The answer to the question about the factors that caused the rise of the state depends on what stages of statehood are singled out. In particu4
In particular, he maintains, that war is considered here as being a derivative of problems in the factors mentioned, rather than a necessary or sufficient factor (Claessen 2010). We think that the war factor is in evidence in virtually every state formation in one form or another; its role can be different (from determinant to essential), but it is never minor (for detail see Grinin 2011b: 78 79; 2011c; Grinin, Korotayev 2009a, 2009c).
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lar, many authors deny the existence of a specific stage of early (primitive, archaic) states. In our opinion, such formations can be treated as states; we should bear in mind, however, that they could not have all the characteristics of developed forms and partially preserved pre- or nonstate institutions. That was why many of them failed to transfer to a higher stage of development. In examining the causes and ways of the rise of the state, political anthropologists often miss the following important point: pre-state polities, when uniting (or annexing other polities), could directly transfer to early state organization. However, pre-state sociopolitical systems often developed, gave rise to nobility, property inequality, and slavery, but failed to become states because they lacked certain political institutions (strong central power, a professional apparatus of control, etc.). We term such non-state societies, comparable with states with regard to their complexity and functions performed, as early state analogues (for details, see Grinin 2003c, 2007a, 2007b, 2007g, 2007i, 2009h, 2011b, 2011c). Large Gallic polities prior to the conquest of Gaul by Caesar (the 1st century BC), large nomadic systems (such as the Xiongnu polity in the 2nd century BC or the Scythian kingdom up to the late 5th century BC), and complex chiefdoms on the Hawaiian Islands prior to their discovery by J. Cook in the late 18th century can be attributed to such formations. Some of the early state analogues never became states (e.g., Xiongnu), while others turned into sufficiently developed large, rather than small or medium-sized, states (e.g., the Scythians). Two main models of transitiong to the state may be justly singled out. According to the first one, states were forming vertically, so to speak, i.e., from non-state societies directly to states. For example, in Ancient Greece, people often had to migrate from villages to one large settlement to protect themselves from military actions or pirates; such migrations are called synoecism (Gluskina 1983). Sometimes, large states were formed vertically at once, as was the case with the Zulus who rapidly created a sufficiently large state under the rule of Emperor Shaka in the south of Africa in the early 19th century from a diversity of small individual chiefdoms (Ritter 1990). The second way is horizontal. At first, pre-state societies transfer to a new stage of development (exceptionally in the form of early state analogues) and then transform into states.
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Early state
Early state analogues
Early state
Pre-state polities
Pre-state polities
Vertical model
Horizontal model
Fig. 3. Two models of transition to the early state
However, the inner maturity of society, sufficient surplus production, social stratification, and so on are not enough to form a state. Special circumstances are necessary because transition to the state system is usually associated with sharp changes in social and political life under any model. In our opinion, this transition is facilitated by serious shifts from the habitual situation, such as the cessation of isolation, the emergence of a real threat to society or a part of the population, a sharp rise in trade, internal conflicts, and so on. All this can stimulate substantial changes in management and the political structure (for details, see Grinin 2003c, 2007a, 2007b, 2007g, 2007i, 2009h, 2011a, 2011b, 2011c; Grinin, Korotayev 2009b, 2009c). In addition, we believe that wars, conquests, borrowing more effective weapons, and the threat of being conquered are, no doubt, of paramount importance among the factors that cause sharp changes in life conditions. For example, importing firearms was an important factor in the formation of certain states, for example, on Madagascar in the 17th century or on the Hawaiian Islands in the late 18th and early 19th centuries (the fact that the islands ceased to be isolated also played an important role here). 3. ON THE TYPOLOGY OF THE EARLY STATES As process of politogenesis should not be reduced only to the state formation so the early states themselves cannot be reduced only to a single type, namely, the bureaucratic one. The diversity of political evolution
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is expressed, in particular, in the variety of early states proper among which the bureaucratic states represent just only a type. Thus, it is rightful to speak about many types of early states (see also Grinin 2001 2006, 2004a, 2004c, 2007h, 2011b). For the definition of the early state see below. For example, Old Russia and Norway (as well as Lithuania in the 13th th 14 centuries and some other early states) provide examples of the druzhina type where power of the ruler was measured primarily by the number of his armed followers (Gurevich 1980: 131). The druzhina (prince's armed forces or retinue) was formed of the prince's closest supporters who helped him to rule the army and the princedom (Gurevich 1970: 173; Shmurlo 2000: 107). As concerns Sparta, e.g., Finley indicated it as a model military state. But according to him, the paradox is that Sparta's greatest military success destroyed the model (Finley 1983: 40). However, besides Sparta many other ancient states were military but with different peculiarities. That is why in my opinion it is more correct to regard Sparta as a military slave-holding and communal state. We can also speak about military-trading states, particularly in regard to the nomadic ones (like the Khazar [Pletnyova 1986, 1987: 206207; Shmurlo 2000: 38; Khazanov 2008] and Turk [Gumilev 1993: 42] Khaganats). A number of medieval European states, Moscow Russia in the 15th the early 16th centuries, the early Ottoman Empire as well as its predecessor in Asia Minor in the 11th 13th centuries, the Seljuquid state were nothing but militaryservant (military-feudal) states (Gordlevsky 1941: 69; Petrosyan 1990: 91; Stroyeva 1978: 511), etc. One can also speak about imperial nonbureaucratic states like the Aztec state (Johnson and Earle 2000: 306); predatory states (like ancient Assyria). The polis and civitas (although sharing many features) each represents a specific type of the early state. Probably it can explain why their evolutionary potentials turned out to be different. The Roman Republic, though not without crises, transformed into a more developed type of state. But the same transformation turned out to be impossible for a small democratic polis though a certain evolution took place there in the 3rd 2nd centuries BCE (see Sizov 1992: 7273). Yet, the early democratic states are not at all peculiar for the European Antiquity only. They were present in different parts of the world. In particular, in Northern India in ancient times (the 6th 3rd centuries BCE) a number of republics existed; they possessed different types of gov-
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ernment but still the population or aristocratic council elected the governors there. Furthermore, the republics struggled with monarchies and more than once won impressive victories. Among great countries the Buddhist sources mentioned also some republic states (Bongard-Levin 1979; Bongard-Levin and Ilyin 1969: 9194; Mishra P. and Mishra J. 2002). 4. ON THE NECESSITY OF CHANGE IN THE CONCEPT OF EVOLUTIONARY STAGES OF STATEHOOD Unfortunately, little attention is paid in political anthropology to the subject of the evolutionary succession of statehood stages (Grinin 2008e, 2011b). The model developed by Claessen and Skalnk, who singled out the two main stage types of statehood, the early state and the mature state (Claessen 1978), has been the most popular over the last two to three decades. The concept of the early state introduced by Henri J. M. Claessen and Peter Skalnk appears to have been the last among the great epoch-making political-anthropological theories of the 60s and 70s of the last century (e.g., Sahlins [1960, 1963, 1968], Service [1962, 1975], Fried [1967, 1975]), which did more than just giving a new consideration of socio-political evolution, its stages and models. One may even say that these theories succeeded in filling the evolutionary gap between the pre-state forms and the state, which had formed by that moment in the academic consciousness due to the fact that the accumulated ethnographic and archaeological data could hardly fit the prior schemes. However, it seems that in comparison with other stage theories from the above-mentioned list the theory of the early state has a number of important advantages, especially concerning the view on social evolution in general and the evolution of statehood in particular. No wonder that Joyce Marcus and Gary Feinman (1998: 6) mention Claessen and Skalnk among such scholars who do not believe in inevitability; they know that not every autonomous village society gave rise to a chiefdom, nor did every group of chiefdoms give rise to a state (see also Grinin 2007i). In the theory of the early state it was fundamentally new and important from a methodological point of view to define the early state as a separate stage of evolution essentially different from the following stage, the one of the full-grown or mature state. To reach the early state
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level is one thing, to develop into a full-blown, or mature state is quite another (Claessen and Skalnk 1978b: 22). At the same time they (as well as a number of other authors) indicated quite soundly that not all early states were able to become and actually became mature ones (see, e.g., Claessen and Skalnk 1978a; Claessen and van de Velde 1987; Shifferd 1987). Thus there was formed exactly an evolutionary sequence of statehood in the form of a two-stage scheme: the early state the mature state. And that explained a lot in the mechanisms and directions of the political evolution. However, the former of these two stages of the evolution of statehood (the early state) has been studied rather thoroughly, whereas the latter (the mature state) has not become the subject of a similarly close examination. Unfortunately, the analysis of the mature state has been little advanced in those several contributions to the subsequent volumes of the Early State project (further referred to as Project) where the subject was touched upon. Below we will present our own approach to the distinction of the stages of the evolution of statehood which to our mind develops and supplements Claessen Skalnk's ideas on the subject. However, this has made it necessary to suggest new formulations of the main characteristics of each stage of the evolution of the state. The fact is when we try to apply the scheme early state mature state to the political development of the humankind it becomes evident that this scheme is in no way complete. Firstly, if, according to the prevalent views, the first mature states appeared in ancient times (Egypt), or in the late 1st millennium BCE (China),5 how could we classify the European states of the 18th and 19th centuries, let alone the contemporary states? Would they be also mature, or supermature? Secondly, it is also obvious that the European 19th century states also differed in the most profound way from the complex politically centralized monarchies of the Antiquity and Middle Ages (which themselves are qualitatively more complex than the early state) according to a number of other characteristics (in particular, with respect to the administration level and culture, in the degree of development of the law, and the relationships between the state and society).
5
For example, in the Early State (Claessen and Skalnk 1978d) contributions dealing with Egypt and China (Janssen 1978: 213; Pokora 1978: 198199), the period of the early state corresponds to the Ancient Kingdom (up to 2150 BCE), whereas for China it is regarded as the period preceding the formation of the Qin Empire (up to 221 BCE).
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Finally, it would be at least strange to assume that modernization in general and the industrial revolution of the 18th 19th centuries in particular did not cause significant changes in state organization. Meanwhile, the above-mentioned theory does not assume the possibility of these changes at all. So the sequence of two stages of the evolution of statehood must be re-examined and changed. Hence we think that it would be more correct to distinguish not two but three stages of statehood, namely after the stage called by Claessen and Skalnk the mature state there must be inserted one more stage which would denote the type of industrial states (not only European but all the industrial states). However, here comes the problem of the name of this third stage. It would be better to introduce a new term for it. But which term? Supermature would sound awkward. So we came to the conclusion to keep the term mature state only for the industrial states and to define as developed states those preindustrial bureaucratic centralized states that Claessen, Skalnk and others call the mature ones (see Grinin 2006d, 2006g, 2007a, 2008a, 2011b; Grinin and Korotayev 2006, 2009a). Hence, we are dealing not with the two main stages of statehood development (the early states and the mature states), but with the following sequence of three stages: early states; developed states; mature states. This has made it necessary to develop anew the statehood evolution theory and to suggest new formulations of the main characteristics of each of the stages of this evolutionary process. For each stage we can identify three phases: the primitive, typical, and transitional states of each respective type.6 In the framework of this chapter the basic characteristics of statehood stages are identified on the basis of the middle phase of each stage (thus, respectively for typical early, typical developed, and typical mature states). The point is that at the first phase (the one of the primitive state of the respective type) the polity retains many
6
In general, these names are given to the respective phases in accordance with the tradition of Claessen and Skalnk (1978b: 2223; 1978c: 640; Claessen 1978: 589) who identified the inchoate, typical, and transitional stages of the early state. However, there are certain problems when we deal with a regression from a developed to a primitive phase of certain types of statehood. For example, to denote the 18th century developed state in Egypt (after it had regressed from the typical developed statehood found there, e.g., in the 16th or 11th centuries) as inchoate appears to be clearly misleading (see, e.g., Grinin 2006e). Hence, the term primitive seems to be more appropriate here.
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elements of the previous state type, whereas in the third phase (the transitional phase) many of its institutions become overripe and the first characteristics of a higher stage of the statehood development appear. Further we will briefly study the main differences between three evolutionary types of state and then examine every type in detail. With such a composition of the chapter the repetitions are inevitable but since the readers are suggested a new theory such iterations are quite justified. 5. MAIN DIFFERENCES OF THE EARLY, DEVELOPED, AND MATURE STATES Early states are insufficiently centralized states. They politically organize societies with underdeveloped administrative-political and with no clear-cut social and class structures. Early states differ greatly from each other in many characteristics in particular with respect to the degree of their centralization, as well as the level of development of their administrative, taxation, judicial systems and so on. However, if we try to understand what differentiates early states from the developed and mature ones, we find that early states are always incomplete states (both organizationally and socially). This incompleteness is also relevant with respect to relationships between the state and the society. Let us see what is meant. There were numerous versions of early states, but within each of them some important elements of statehood were either absent, or significantly underdeveloped. In most cases this incompleteness was expressed in the most direct way, as most of the early states simply did not have the minimal necessary level of centralization or/and some significant statehood attributes, or did not develop them to a sufficient degree. Early states often lacked a complete set or a satisfactorily developed set of power attributes that later became universal, such as a professional administrative apparatus, a system of regular taxation, administrative territorial division, written law, and sufficient centralization. Organizational and administrative institutions of early states were quite specific. For example, militia or feudal levy instead of regular army, landowners who performed the functions of both administrators and landlords instead of professional state officials and judges, a conglomerate of individual areas with their individual forms of power instead of a clear divi-
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sion into provinces, incomes from the king's domain instead of taxation, and so on. It is very important to understand, that professional apparatus, taxation system, and territorial division are optional for early states; they become obligatory only for the next evolutionary type, the developed state. But this incompleteness of early states is also relevant with respect to the relations between the state and the society. However, in some early states (such as, e.g., the state of the Incas or the Early Kingdom in Egypt) a contrary disproportion is observed. Though the administrative apparatus and bureaucracy were rather powerful there, they were imposed upon societies that were underdeveloped socially and/or ethnically. Hence, in such cases it was the society that looked underdeveloped in comparison with the state. Developed states are fully formed centralized states of the Late Antiquity, the Middle Ages, and the Early Modern period. They politically organize societies with distinct estate-class stratification. The developed state is a state that has been formed and is inevitably completed. So that is why the attributes of statehood that could be absent within the political system of the early state such as a professional apparatus of administration, control and suppression, a system of regular taxation, an administrative territorial division, and written law are necessarily present within that of the developed one.7 The developed state was an outcome of a long historical development and selection, as a result of which those states turn out to be more successful whose institutes are organically linked with the social structures of respective societies that are both grounded on the respective social order and support it. The developed state affects social processes in a much more purposeful and active way. It is not only closely connected with the peculiarities of the social and corporate structure of the society, but also constructs them in political and judicial institutions. In this respect it can be regarded as an estate-corporate state.
7
Naturally, the notion of developed state is rather conventional. It can only be regarded as developed in comparison with the less complex (early) state, whereas it appears underdeveloped when compared with the more complex (mature) statehood. Thus, the Russian state in the age of Ivan the Terrible appears rather developed when compared with the Muscovy Princedom of Ivan Kalita and his successors. However, it does not stand any comparison even with the empire of Peter the Great. However, Peter I's state looks rather primitive in comparison with, say, the Russian Empire in the late 19th century.
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Mature states are the states of the industrial epoch. It is a result of modernization, development of capitalism and the industrial (as well as demographic) revolution; hence, it has a qualitatively different production basis and social structure. Thus, according to this point of view, in the Antiquity and Middle Ages there were no mature states, but only early and developed ones. Mature states politically organize societies, where estates have disappeared, the industrial classes (bourgeois and employees or the analogous groups of the socialist nomenklatura and employees) have formed, nations have developed and nation-state formed, and representative democracy or one-party state have proliferated.8 The mature state greatly differs from its precursors. Organizationally and legally, it significantly surpasses the developed state: it has qualitatively more developed and specialized institutions of management and an apparatus of suppression and control. The state apparatus and army become autonomous to a certain degree and play an increasingly clear role of an abstract mechanism of serving society. There are also a clear-cut mechanism and a written procedure for the legitimate transfer of power (absent in many developed states).9 As a rule, constitutions and systems of power division are created, and the role of law, especially civil law, increases. On the whole (except for some totalitarian and authoritarian states), the systems of law and legal proceedings reach quite a high level in mature states. The most important function of this type of state is ensuring not only social order but also the everyday legal order. 6. EARLY STATE First of all, let me introduce my definition. The early state is a category used to designate a special form of political organization of a relatively large and complex agrarian society (or a group of societies/territories) that determines its external policy and partly its social order; it is a power organization (a) that possesses supremacy and sovereignty (or, at least, autonomy); b) that is able to coerce the ruled to fulfil its demands; to alter important relationships and to introduce new norms,
8 9
On totalitarian mature states see Grinin 2007a: 274, 279280. This was also related both to the rules of the succession to throne whose absence often caused violent struggle for the throne among the heirs in the developed states, as well as the election rules to the representative institutions.
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as well as to redistribute resources; c) that is based (entirely or mostly) on such principles that are different from the kinship ones. Once again we point out, this definition does not mention professional administrative and control apparatus, regular taxation and artificial territorial division as necessary traits of the early state because in the early states those traits are almost never observed in their entirety. The state as a form of political organization of the society reflects the social construction of the latter. Our analysis of the traits typical for the early state indicates that this state should be regarded as incomplete. This incompleteness implies that there are certain restrictions within the system of relationships between the state and society that block the further development of the early state. These restrictions mean that such a relationship between the state and society is retrospectively (from the point of view of the evolutionary potential of the respective system) inadequate in comparison with what we observe within more developed systems. Thus, it is in no way strange (what is more, it is perfectly normal) that most early states never evolved into developed states (see, e.g., Claessen, van de Velde 1987; 1991; Skalnk 1996; Shifferd 1987; Tymowski 1987; Kochakova 1995), whereas those that did it, usually only achieved this through painful crises and cataclysms that caused a deep reconstruction of the entire system. The restrictions manifest themselves in different ways. Sometimes the political form of the early state turned out to be insufficiently tightly connected with the society. In such cases it did not matter (for a state superstructure) what it controlled. Take, for example, Central Asia where interstate borders did not get stabilized for centuries, they changed constantly in connection with purely military circumstances and a new conqueror's luck (this is also rather typical for West Asia and North Africa). As another example, one can take Medieval Europe during the 11th 13th centuries, where huge areas were transferred from one ruler to another, and from one polity to another as a result of rulers' marriages/divorces, deaths and inheritance cases.10
10
Suffice to mention just one example. In the 12th century the French King Louis VII obtained the largest (within France) Duchy of Aquitaine and the County of Poitou through a dynastic marriage to Eleanor of Aquitaine. However, he lost them rather soon as a result of his divorce with Eleanor. A few months later she married Henry Plantagenet (Count of Anjou who also controlled within France the Duchy of Normandy, as well as the Counties of Touraine and Maine). Consequently, Aquitaine fell under Henry's control. The further development of events was even more interesting.
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Europe at this time is an example of a political system with a weak administrative structure. However, we also find such cases of incongruence between the state and society when the political system of a state possesses a developed administrative apparatus that is able to control and regulate different territories. This could be observed in Mesopotamia where states frequently changed their borders, grew and shrank in a rather fast way, which was accompanied by a fast dynastic change. However, the principles of statehood remained the same as the bureaucracy easily imposed itself over any territorial configurations. However, in some early states the above mentioned limitations expressed themselves in the fact that the links between the state and society were too tight, that is, some state form was appropriate only for a given society. As a result such states were incapable of performing qualitative transformations. A good example is provided here by the organization of the Greek poleis that failed to transform themselves even when their independence was threatened. A paradox of Greek history is that its main tendency was the continuous and generally unsuccessful aspiration to overcome the polis: it was continuous because of the incongruence of sometime established polis principles with the subsequent social progress, whereas it was unsuccessful because the attempts to overcome the polis were undertaken on the very basis of the polis (Frolov 1979: 6). We have identified the two main types of incongruence between the political and structures of the ancient and medieval states. The first and the most wide-spread incongruence is when the administrative structure of the state is underdeveloped. As was mentioned above, early states did not possess the complete set of important features of the developed state, or had not developed all (or some) of them up to a sufficient degree. In fact, some of these features could be rather developed, whereas the rest were underdeveloped (and some could just be absent). First of all, this is relevant for such statehood attributes as: (1) a professional administration/control/oppression apparatus; (2) taxation; (3) administrative (i.e. made specially for the purpose of governing) territorial division; and (4) the presence of written law
Since the conquest of England by William, the Duke of Normandy, the kinship networks of the English and French nobility got intertwined very tightly, which led to Henry's becoming the King of England. Consequently, all the above mentioned French territories (stretching from the English Channel to the Pyrenees and exceeding the size of the royal domain of the King of France) fell under the control of the King of England (who still remained formally a vassal of the King of France) (see, e.g., Kirillova 1980: 216217; Kolesnitsky 1980: 194; Lyublinskaya 1972: 97).
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and written administrative documentation (orders, directives, reports, archives, etc.). Frequently early states had a rather weak apparatus of administration and oppression. Sometimes this weakness was combined with a primitive character of social stratification, as, for example, could be observed in the European barbarian kingdoms of the early Middle Ages. On the other hand, estate-class stratification could be expressed in a rather distinct way, whereas the administrative apparatus was weak and non-bureaucratic, as could be found in Athens, Rome and other states where professional administrators were either absent all together (and magistrates occupied their positions in turn or by drawing lots), or they did not receive salaries and were elected for short periods of time (see, e.g., Osborne 1985: 9; Finley 1977: 75; Shtaerman 1989; Grinin 2004c, 2004e, 2008f, 2010a). It was not always the case (especially in the Ancient period) that early states had regular armies, whereas rulers relied on levies as their main military force. Also, police systems were seldom found in these early states.11 In some early states we find tribute, gifts, temporary loans rather than true regular taxation, etc. Frequently taxes were irregular; for example, often they were only collected during wars. In some cases they could be absent all together, as the government could have other sources of revenue, such as monopolies on some types of trade (including foreign trade), or some types of economic activities (e.g., extraction of salt and other minerals), special lands and territories whose revenues were used to support the ruler (thus, in medieval Europe revenues of the royal domain were frequently the main source of the state finance); tribute and contributions paid by subjugated areas; compulsory payments of allies (as, e.g., within the Athenian arche) and so on. In the early Roman Republic a very important source of public financing consisted of revenues from the public lands that were rented out, whereas taxes were only collected in extraordinary circumstances (see, e.g., Petrushevsky 2003 [1917]: 86).12
11
It is not surprising that with respect to the early states the data on the presence of police forces are extremely scarce. For example, among two dozen early states surveyed by Claessen (Claessen 1978: 560) he only managed to find some evidence of the presence of police systems in four cases. 12 A rather telling statement is made by Trouwborst (1987: 136) who notes that the states of the African Great Lakes region did not create a full-fledged taxation system and adds that if they had created it, this could have been the end of the early state.
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In some early states we find natural rather than administrative territorial divisions, or such divisions as based on clans, tribes, or local communities (see, e.g., Korotayev 1995, 1996; Grinin 2006g, 2007a).13 Such incomplete early states were often just imposed over societies and restricted themselves to military and redistribution tasks, collection of tribute and duties without penetrating deeply into social life.14 Ancient Russia was such a state for a rather long period of time as well as many states created by nomads, many early states of Tropical Africa and so on. It was not rare when a young state nourished a vigorous layer of new nobility that stopped taking into account the interests of the very state that had created it and began to shape social processes of their own. A clear example is provided here by the titled nobility of medieval Europe that transformed service fiefs into private property, enslaved peasants, stripped the kings of their tax-payers and soldiers, and finally transformed kingdoms into nominal entities. Similar processes could be observed during certain periods in many other countries` history starting from rather ancient epochs (e.g., in China of the Chou period: Vasilyev 1993: 187189; see also Kryukov 1974: 1415; Kril 2001). The process described above is the representative of the typical early state phase and turned out to be a period of feudal decentraliztion. That is why the following statement makes sense: Political decentralization of the early feudal epoch is not a symptom of the state's weakness, but a natural condition (within the observed circumstances): this was a hierarchicized alliance of vassals and seniors based on a system of personal links that were the prevalent form of social relations in this society (Gurevich 1970: 60). In small (and to some extent in medium-size) states the administrative apparatus was usually underdeveloped and insufficiently separated from the population due to their sizes. Indeed, within such a scale many problems can be solved in a rather effective way by means that are different from state orders and controls (they could be solved, e.g., by private persons, through the direct expression of the population's will, or through the activities of clans, professional organizations and social groups). Here the growth of statehood was connected first of all with
13 14
Many examples of this can be found in Tropical Africa (see, e.g., Kubbel' 1988: 132, etc.). Not surprising the social stratification in the early states quite often is not sufficiently pronounced (see, e.g., Maretina 1987; see also Kubbel' 1973: 232; Tomanovskaya 1973: 280).
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the necessity to wage successful wars, and sometimes to organize foreign trade. An important role could be played by the state in the settlement of social conflicts, as this was observed in Athens, some other Greek poleis, and to some extent in early Rome (with respect to the conflict between plebeians and patricians). As a result of such conditions, some features of statehood were strengthened and others lagged behind. The particulars depended on the peculiarities of concrete polities. Spartan, Athenian, Phoenician (as well as Roman and Carthaginian [naturally until the respective polities remained small]) ways are just some versions of such development. On the other hand, large early states of the imperial type that originated as a result of conquests were bound to disintegrate or to get radically reduced in size. Empires rarely remained powerful for more than 100 consecutive years (see, e.g., Taagapera 1968, 1978a, 1978b, 1979). Numerous rises and falls of Assyria in the 13th 7th centuries BCE can serve here as a clear example (see, e.g., Sadayev 1979). However, even when an early state was militarily strong enough to keep its provinces under control for long periods of time, still it usually turned out to be insufficiently developed to integrate effectively its constituent parts. There was usually a pronounced imbalance between the statehood of the center and its periphery (see, e.g., Thapar 1981: 411). As a rule a typical early empire was a multipolity, that is, a political system consisting of a state in its center and various non-state polities at its periphery (see, e.g., Korotayev et al. 2000: 2324; Grinin, Korotayev 2006: 7980; 2009a). And such states as republics of Rome, or Carthage or Mauryan Empire in India in the 4th century BCE, and moreover Charlesmagne's Empire, Grand Duchy of Lithuania of the 14th century and many other large states were not tightly integrated systems, but rather conglomerates of territorial polities (for more detail see Grinin 2007a: 134135). They possessed systems of special links between the center and every people, every region, every territory, whereas some peoples/communities had more rights, some others had fewer rights, some were almost equal to the center, and some had an extremely low status. The second kind of incompleteness of the early state was opposite to the first and by far less frequent one. We are referring to those states that possessed a developed bureaucratic administrative apparatus
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while, at the same time, had an underdeveloped social structure. Such states lacked sufficiently distinct forms of social stratification (that is, they did not have clearly expressed classes or estates, and lacked sufficiently mature land property relations). What is more, an overdeveloped administrative apparatus could block the formation of a sufficiently developed and stable social system. Examples of the similar situation are: Egypt of the Ancient Kingdom; the Inca Empire; Sumer of the Third Dynasty of Ur (the 21st century BCE); and the subsequent state of Hammurabi.15 Thus, one may say that in such states bureaucracy (notwithstanding all its organizational importance) was an external superstructure over society. In other early states, military nobility with its retinues was imposed over society. However, these elites possessed different methods for exploiting and influencing the society (see Grinin 2007a for more detail). If in the former case of incompleteness the early state's weak governments sometimes failed to sufficiently mobilize country's resources as they dealt with self-willed nobility and local governors; in the latter case, the state suppressed the society by trying to restructure it entirely to meet the needs of the state. It took upon itself the functions of resource redistribution and production organizer/controller. Such a state's hypertrophy developed under conditions of a subsistence economy (as was observed, e.g., in the Inca Empire). However, an obsession with registration and control could also be found in societies with commodity-market relations if state duties in kind were also prevalent there; for example, the collection, transportation, storage, and redistribution of duties kind are much more arduous and cumbersome than the accumulation of money. However, the overdevelopment of the bureaucratic administrative apparatus within the state of the Third Dynasty of Ur and the kingdom of Hammurabi sharply distinguished them from the rest of archaic states. Hence, though, on the one hand, these states could be considered early states, on the other, they could also be regarded as developed state analogues (we have taken both these points into account in Table 5).
15
See on the Inca Empire: Berezkin 1991; Zubritskiy 1966, 1975; Inca Garsilaso 1974; Kuzmischev 1974; Mason 1957; Schaedel 1978; on Ancient Egypt: Perepyolkin 1988, 2001; Vinogradov 2000a; Zablotska 1989; Brested, Turayev 2003; Zhak 1992; on Mesopotamia: Dyakonov 1983: 370; Zablotska 1989; Kozyreva 2000: 83; Oppenheim 1990: 66, 67.
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7. DEVELOPED STATE First of all, it is necessary to note that the developed state is more organic for society; to be more exact, the state becomes its natural political form, though the fitting process could proceed painfully and turbulently. The road to the developed state was lengthy and complicated as the developed state was the result of numerous transformations, upheavals, splits and reintegrations; within these processes there was a natural selection leading to more effective types of interaction between the state and social/ethnic structures. Significant progress in state political, administrative and legal arrangements as well as ideology was needed so that the developed state could appear. On the other hand, a certain level of ethnic, social, economic, and cultural development was necessary as a result of which society becomes sufficiently consolidated socially and ethnically. It is rather essential that the developed state is not only tightly connected with the society's social and corporative structure and formalizes them in political institutions, but that it also influences them much more purposefully and actively. The developed state is centralized and complete, i.e. many features that could be absent in the early states, are necessarily present in the developed states. Such a state is formed as a result of a long period of development of administration techniques, expansion and professionalization of administrative structures, and the coordination of the state agencies to perform their various designated tasks. Hence, the developed state is a category that denotes a natural form of political organization of a civilized society (or a group of such societies) that is characterized by a centralized organization of power, administration, coercion and order maintenance in the form of a system of special institutions, positions (titles), organs, laws (norms) and that possesses (a) sovereignty; (b) supremacy, legitimacy and reality of power within a certain territory and a certain circle of people; and (c) has the capability to change relations and norms. We have formulated here the minimum characteristics of the developed state that distinguish it from the early state: a) The developed state has more statehood attributes which in addition are more elaborated. The developed state possesses all the statehood features mentioned below in a rather clear and systematic form: a special professional administration/coercion apparatus sepa-
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rated from the population; regular taxation; and an artificial territorial division. Also it always has a written law and a special culture of written documentation, registration, and control.16 Such a state cannot rely on levies and has a regular professional standing army. Archaic duties and revenues (tribute, gifts, labour-rents, revenues from state-sponsored plundering and contributions) disappear, or play subordinate roles. Taxation becomes more regular and ordered. b) The developed state is an estate-corporative state. The social structure of the developed state becomes represented by large social groups and not by numerous tiny social layers or socio-territorial units (like autonomous cities or temples with special privileges) which are found in early states. Large ethnic groups develop instead of conglomerates of tribes and small peoples. As a result, society becomes socially quite consolidated. The estate consolidation is connected with a decline in the isolation of areas and territories, with economic unification of the society, and with more intensive contacts within the elites representing different parts of a country. With respect to states one cannot help but notice that the activities of a developed state are directed toward the legal shaping of estates, at making the society more stable, at ordering social mobility. On the other hand, both the state structure and its policies reflect the peculiarities of its social (and ethnic) arrangement; the state actively influences the social structure of society and acts as an intermediary between various estates/corporations. We can frequently observe a process of more distinct shaping of the system of titles and officials' ranks (in the latter case it is especially relevant when the ruling class is identical with the officials' corporation (what is denoted as state-class by Cheshkov [1967: 243245]). c) The developed state is always a centralized state; generally, it is much more durable and stable than the early state. The developed state cannot be a political conglomerate, as was frequently the case with respect to early states. This is not just a set of territories that disintegrate as soon as the central power weakens. Of course, disintegration can be experienced by the developed states rather regularly (especially, during the transition from primitive to typical developed statehood17). However,
16
Note that it was not infrequent when in the early states (even when the writing was available) not all the state acts were written. Many (and sometimes most) acts remained oral. For example, according to Jacques Le Goff (1992: 45), this was the case in the Charlemagne's empire. 17 They were also regularly observed at the end of political-demographic cycles because the preindustrial socio-demographic cycles usually ended with a political-demographic collapse, after
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if the development of such a state continues, it is always connected with a new and tighter form of centralization within more or less the same territory. This is accounted for by the fact that the developed state is formed within a definite, historically prepared (both materially and culturally) territory with a common culture, ideology, and writing, and is supported by the development of communications, trade, a certain unification of money types, measures, law, and so on.18 Hence, the higher is the level of statehood development, the more stable it is with respect to the destabilizing influence of various crises, and the faster is its transition to the recovery growth phase.19 d) The developed state is characterized by a more developed economic base. In particular, unlike the early state, the developed state cannot be formed without cereal production (let alone the fact that it cannot develop on the basis of animal husbandry), whereas some early states (first of all in Tropical Africa) were formed on the basis of such agriculture domesticates as yams, bananas, manioc, peanuts etc. (see, e.g., Bondarenko 1995: 103). The developed state cannot fail to possess an internal market, it cannot be based on subsistence economy, unlike some early states (e.g., the Inca Empire, or Egypt of the Old Kingdom period). At least some development of market relations is necessary. There should be not only some craft specialization, but also some regional specialization, that is an integrated economic organism should start its formation within the state.20 e) Many early states existed in the form of barbarian societies, whereas the developed state can only be based on a civilized society.
which a new cycle normally began (see, e.g., Turchin 2003; Nefedov 2004; Turchin and Korotayev 2006; Korotayev, Malkov, and Khaltourina 2006a; Grinin 2007j). Considering the problem of a larger degree of centralization and integration of the developed states in comparison with the early ones it may be useful to take into account the classification of empires developed by Romila Thapar (1981: 411413) who divides empires into two types depending on the nature of relationship between the metropolitan (centre) and peripheral areas (respectively integrated to a larger or smaller degree among themselves). 19 However, the transition to the mature statehood (or the transition from a primitive mature state to a typical mature one) was quite frequently connected with profound social upheavals, social and political revolutions, as this was observed in England, France, Germany, Russia and other countries, whereas sometimes such crises resulted in temporary state breakdowns, as this happened, for example, in China in the first half of the 20th century (see about such processes in Egypt in the 1620th centuries Grinin 2006e, 2007l; Grinin, Korotayev 2009d, 2009e). 20 On the formation of such a market, for example, in Russia, China, Japan, and England see respectively Preobrazhensky 1967: 2528; Chromov 1988: 148152; Simonovskaya, Lapina 1987: 119; Galperin 1958: 27; Kuznetsov et al. 1988: 115; Vinokurov 1993: 48; Lavrovsky, Barg 1958: 72.
18
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That is why such states only develop in the areas of rather advanced civilizations (and frequently on the basis of leading ethnic groups). f) The developed state conforms significantly better than the early state to the definition of the state as an organization of coercion functioning in order to keep the lower classes under the domination of the higher classes and to secure the exploitation of the former by the latter. In the developed state the social role of the state changes. In developed states the coercion serves the interests of upper strata (classes) in a more effective way, which makes it possible for them to exploit the lower strata and to keep them under a tight control,21 whereas in many early states exploitation was not very pronounced (see, e.g., Trouwborst 1987: 131; Service 1975). As the state itself takes the function of maintaining social order, it reduces the possibilities of the upper strata to solve themselves the problems of coercive support of their position. This may be realized for example, through the prohibition for them to have their own armed forces to build castles and fortresses, to apply certain coercive measures to those dependant on them. Such prohibitions and regulations increase the importance of law-courts and state administration. This (in addition to other factors) contributes to the more pronounced role of the state coercion with respect to various social groups in the developed state, as compared with the early one. g) The presence of a new type of state ideology and/or religion. Political ideology in the broad sense of this term develops instead of primitive ideas of royal power (based on notions of mythical ancestors, the concept of reciprocity and genealogical distance from the sovereign [Claessen and Skalnk 1978a: 633], royal supernatural abilities and so on). Confucianism in China provides a telling example here (Vasilyev 1983; Lapina 1982). However, such an ideology usually had certain religious forms (e.g., the 16th century Russian treatment of Moscow as the Third Rome see Paips 1993: 306307). As a result, in many developed states (as was observed in China and other East Asian countries according to Martynov [1982: 67]) the state became sacred by itself. In areas with church-type organization of major confessions this demanded
21
In fact, Claessen and Skalnk emphasized this point noting that the mature [i.e. the developed one in our terms] state becomes an instrument in the hands of the social class of the owners of land and other means of production (Claessen and Skalnk 1978a: 634). However, this emphasis on the private ownership of the means of production underestimates the fact that in most complex agrarian societies the private landownership played a subordinate role and that was not so important in comparison with a person's position within the state hierarchy.
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an alliance between the state and the official church (with respect to some European states see, e.g., Le Roy Ladurie 2004: 8). It is quite natural that different states entered the developed state phase in different ages. Hence, it makes sense to outline a chronology of concrete states entering this phase (a more comprehensive [but less detailed] chronology can be found in Table 5). However, the indicated dates refer to the beginning of the transition to developed statehood, with the main transformations taking place later, sometimes much later.22 As is known, the first states emerged in the 4th early 3rd millennia BCE (see, e.g., Vinogradov 2000a: 150151; Dyakonov 2000: 4556; Baines and Yoffee 1998: 199; Wright 1977: 386; 1998), though the dates differ depending on various historical and archaeological reconstructions; of course, they also depend on the definition of the state used by different scholars. During the subsequent more than millennium and a half, the main trend in political evolution was the transformation and integration of pre-state formations and polities into early states or early state analogues; some of analogues transformed into early state; small early states and their analogues into larger ones. In such a complex political landscape rather complex interstate, to be more precise interpolitical connections, were established. Then, in the late 3rd millennium the World System political complexity increased even more. This is connected with the beginning of the transition to large and more organized states, as well as to states of a new evolutionary type. In the late 3rd millennium BCE, formations close to the developed state first appeared i.e. the analogues of developed states: the Third Dynasty of Ur Sumer and Middle Kingdom Egypt but turned out to be transient (see below and Table 5). The first developed state (New Kingdom of Egypt) rose in the 16th century BCE.23
22
23
In Table 5 for the sake of formalization we had to connect such transformation to certain dates, which, of course, oversimplifies the situation, as it is quite clear that such serious transformation could not take place within a single year (no matter how important it was), but usually occurred within the time span of decades. In addition to this, some of the dates are disputed; yet we did not find it appropriate to discuss various hypotheses on concrete dates within the present context (for more detail see Grinin 2007a). Egypt possessed a few features that made it possible for the developed state to appear there earlier than in other countries (though partial analogues of the developed state appeared in Mesopotamia already in the late 3rd millennium BCE). Firstly, this is the position of the Egyptian mainland as a narrow strip along one navigable river, the Nile. Secondly, this is a very high level of its ethnic and cultural homogeneity. Thirdly, this is a rather long period of absence of any significant external threat (and in this respect Egypt was very different from Mesopotamia). Fourthly, this is the presence of a strong ideology of royal power. Fifthly, this is the weakness of
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In this period we observe major changes in the Egyptian economy as it becomes more intensive and productive, among other things through the use of a new type of plough, hydraulic devices, and the execution of large-scale irrigation projects. There is a considerable progress in crafts, proliferation of bronze tools, development of private property and trade (Vinogradov 2000b: 370372; Perepyolkin 2001: 259280). In fact, it was just at this time when the evidence on market transactions and commodity exchange appeared and become numerous, when silver began to supplant grain in the function of money, though incompletely (see, e.g., Monte 1989: 167168). Considerable changes also took place in socio-political life (Vinogradov 2000b: 370372; Perepyolkin 2001: 259280). Centralization increased and the monarch's autonomy decreased radically. A large military empire was created, which was accompanied by the formation of new layers of state administrators (in particular, military and civil administrators of a new type) and a redistribution of material resources in their favor. The working population became freer compared to the king's servants of the Middle Kingdom Age, though many things regarding agrarian relations during this period remain unclear, including information about peasants' rights with respect to the land they tilled and how they were connected to the land itself (Stuchevsky 1966; 1982: 118). Within the New Kingdom we see quite a clear formation of corporate structure and a higher separation (including the hereditary character of the occupations) of various social strata: priests, warriors, craftsmen of different specializations, which became even more pronounced in subsequent epochs. This brought the structure of Egyptian society closer to the structure of estate societies and, as we have mentioned, the presence of large all-state estates is a very important feature of the developed states. China reached this stage as a result of its first unification in the late rd 3 century BCE under Qin Shi Huang.24 Changes that had taken place in the country were enormous, as Qin Shi Huang's reforms had changed the administrative system and territorial division of the country. These reforms unified legislation, the writing system, and the system of meastrade and money circulation, which strengthened the redistributive role of the state for a rather long period of time; however, later this point hindered significantly the further development. However, in a few Chinese states of the Zhango period (especially within the Qin state itself [that became the unification core]), as a result of the legist reforms (with respect to Qin these are the Shang Yang reforms of the 350s BCE), we can observe a sort of transition to polities that can be already regarded as developed state analogues (see Table 5).
24
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ures and weights; the money system was reformed, the Great Wall was completed, and so on. These reforms also led to enormous social transformations (Kryukov, Perelomov et al. 1983: 1721; Perelomov 1962). The Roman state reached this level by the late 1st century BC, with the formation of the emperor's power. However, it is only by the late 3rd century that the Roman Empire distinctively demonstrates all the features of the developed state. In this case those distinctive features are manifested in a hierarchical system of estates, hereditary ascription of people to their professions and statuses, a huge elaborated policebureaucratic apparatus, 'theocratic' power of the Emperor, the state religion that was obligatory for all the subjects and that sanctioned the official ideology (Shtaerman 1968: 659; see also Petrushevsky 2003). Byzantium was a developed state from the very beginning, because the Roman tradition was not interrupted there. Thus, it is not strange that in comparison with contemporary Barbarian kingdoms, Byzantium stood apart from the point of view of its regular and unified legislation and legal systems. According to some estimates, by the 6th century the population of the Byzantine Empire reached 5065 million (Udal'tsova 1988: 15, 34). As it was said above, sometimes it appears possible to speak about the beginning of the initial phase of the developed state only retrospectively, taking into consideration the further evolution of the respective state. Such changes are described by Lukonin (1987: 141, 137) with respect to Iran in the following way: The early Sassanid monarchy in its essence was not very much different from the Parthian one, however, the changing circumstances helped to gradually centralize the state. The polis is replaced with the royal city, the system of semi-independent kingdoms is substituted with the unified state administrative system, the religious tolerance of the Parthian kings and multiplicity of religions are replaced with the unified state religion Zoroastrianism... The Sassanid period is characterized by a constantly growing tendency towards centralization. However, by the middle of the 3rd century CE, Iran can already be regarded as a developed state with the consolidation of the Sassanid dynasty. Already since the reign of the first Sassanid king, Ardashir I (227241), major transformations took place in this country (they were caused both by purposeful governmental actions and spontaneous social processes); these transformations included the abolishment of the vassal kings and their replacement with governors, the strengthening of cen-
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tralization, adoption of a new religion, formation of new estates, reform of the territorial division, change of ethnic characteristics of the population, linguistic and cultural consolidation of the country (Lukonin 1987; Novoseltsev 1995: 24, 31; see also Fry 1972; Kolesnikov 1987). Note for example, that the Shahinshah appointed the heads of the four estates, which comprised the nation, at the level of the whole state (Kolesnikov 1987: 185). It may be suggested that Japan entered the developed state phase by the early 15th century, when Shguns of the Ashikaga dynasty managed to strengthen their control over centralized power and, as a result, they came close to being in the position of absolute rulers of the country, though the period of their real power was not long (Tolstoguzov 1995: 561; Kuznetsov et al. 1988: 89).25 Centralization attempts were undertaken in Japan already since the 12th century, which among other things manifested themselves in the formation of the very institution of shogunate (1192 CE). However, it was only in the 15th century when one could detect contours of the socio-political system that reached its maturity two centuries later, during the Tokugawa shogunate: a deified Emperor who did not actually rule; concentration of real power by the Shgun; his reliance on the military servant estate of the samurai; concentration of regional power by the local rulers (daimy) who, however, were controlled by the Shgun in a variety of ways. Naturally, the overall system was based on resources extracted from the tax-paying estates of peasants, craftsmen, and merchants. The samurai estate had already been formed to a sufficient degree by the 14th century when it was finally separated from the peasantry, whereas the daimy estate began its formation just in the 15th century (Kuznetsov et al. 1988: 73, 89; Spevakovsky 1981: 1217). France entered this phase in the late 13th century during the reign of Philip IV the Fair (12851314).26 By this time in France, due to the activities of his predecessors and favorable economic development, we observe the formation of a sufficiently developed administrative apparatus, a taxation system, court system, and the general strengthening of the state. The royal domain had significantly grown, though the level of political
25
As this happened frequently at the first phase of the developed statehood, the political centralization declined some time later, and the internal warfare started. The second phase of centralization was over by the late 16th century. 26 He became famous for his confiscation of the huge assets of the Knights Templar, and the movement of the official seat of papacy to Avignon.
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centralization was still rather low. We can also observe the formation of estates and their political representation (les tats gnraux) (Lyublinskaya 1972: 94109; Tsaturova 2002: 1213; Hay 1975: 138). However, the Hundred Years' War retarded the process of the French statehood development. Afterwards, since the first half of the 15th century, they had to restart the political centralization process from an extremely low benchmark, when the main issue was the very survival of France and her French king (Hay 1975: 153160). Spain entered this phase in the late 15th century (as a result of the union of Castile and Aragon). The joint reign of Ferdinand and Isabella (14791504) was a turning point in Spanish history. They managed to unite the country, to strengthen the order within it, to undertake important reforms, to establish an effective control over nobility, though its strength had not been eliminated till the end (Johnson 1955: 105106). The discovery and colonization of the New World accelerated the development of Spain. England entered this phase in the late 15th century and the early th 16 century (after the end of the War of the Roses and the Tudor dynasty coming to power). It was already Henry VII (14851509) who achieved much with respect to the political centralization of the country; in general, as a result of the Tudor dynasty reign that lasted more than a century, a new political system (absolute monarchy) formed and flourished in England (see Dmitrieva 1993: 163), though English absolutism was significantly different from it French (let alone Russian) counterpart (see Saprykin 1991: 207208; Karev 1993: 160161). For many European countries the 16th century was a period of state construction (Elliott 1974: 80). But this century also served as a turning point for the political evolution of such countries as Russia, India and Iran. In Russia the developed state formed in the second half of the 16th century during the reign of Ivan the Terrible (15471584). Changes in Russia`s political and social life that took place in this period are well known. Ivan revised the law code (known as Sudebnik), created a standing army with guns (the streltsy) and improved artillery. He reformed the central and regional administration by establishing the Zemsky Sobor (a legislative body of a parliamentary type), the council of the nobles (known as the Chosen Council), the local self-government in rural regions. Then he annexed the Kazan and Astrakhan Khanates (se, e.g., Shmidt 1999).
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In India the developed state formed some time after the creation of the Mughal Empire, in the second half of the 16th century, during Akbar's reign. In contrast to its predecessor, the Delhi Sultanate (the 13th and 14th centuries) a number of whose achievements were applied within the Mughal state, the latter was a much stronger and more centralized empire.27 Akbar who ruled for half a century (15561605), united under his rule the main part of the Indian territory and conducted important reforms of state administration that in many respects continued the line of Akbar's grandfather, Babur (Azimdzhanova 1977: 152). However, the further development of Indian statehood met with considerable impediments, though in some respects (in particular with respect to the elaboration of the administrative system) it reached a considerable degree of maturity (see, e.g., Ashrafyan 1987: 230). India remained at the level of a primitive developed state, and, as a result of the long and cruel reign of Akbar's grandson, Aurangzeb, (16581707), the Mughal Empire began to decline and virtually self-destructed (Antonova 1979: 213225, 233241). The inability for further development also manifested itself in Iran. After centuries of foreign rule, crises and stagnation, in the late 16th century and the early 17th century, during the reign of Abbas I (15871629) and his successors Iran became again a large and powerful state. Important reforms were conducted. At this time we can say that Iran entered again the developed state phase. However, subsequent rulers turned out to be rather incapable, and in the late 17th century and the early 18th century, economic situation in the country became critical, trade (including the foreign trade) declined, the tax burden increased, social relations between the populace and state became aggravated, and rebellions began. A political and economic crisis developed, which was aggravated by Turkish and Afghan invasions, as well as interference by foreign powers; these resulted in the extreme devastation of the country and economic stagnation. Even a temporary strengthening of Iran during the reign of Nadir-Shah who became famous due to his successful wars,
27
The Delhi Sultanate achieved the peak of its might during the reign of Alauddin Khilji (1296 1316). However, his huge empire was an unstable military-administrative formation, from which a considerable number of principalities split by the end of Alauddin's rule (Ashrafyan 1960: 228). Nevertheless, Delhi Sultanate can be regarded as the developed state analogue (see Table 5). The Mughal Dynasty was founded by the famous Central Asian warrior and poet Babur (from Timur's lineage) who started his conquest campaigns in India in 1519. He conducted a number of important reforms (especially, with respect to taxation) in the conquered part of India (see Azimdzhanova 1977).
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including the capture of Delhi in 1739, did not change the situation for long. At the end of his life Nadir-Shah himself conducted such an irrational internal policy that after his death the country experienced political disintegration, internal wars, power struggle between various cliques. Iran virtually disintegrated again (Petrushevsky 1977; Kuznetsova 1986: 229). And as in the 18th and 19th centuries the country was under the strong influence of Russia and the European powers, its further independent development was greatly hindered. The entrance of the Ottoman Empire into the developed state phase can also be dated to the 16th century. It appears that this transition took place during the reign of Suleiman I Kanuni (the Lawgiver) who was called the Magnificent by the Europeans (15201566).28 By this time we can observe the formation of a sufficiently effective military fief system that provided the Empire with a rather battle-worthy and large army. The Ottomans developed a system of registration of fief-holders (the sipahis). Suleiman elaborated it by forbidding the governors to distribute the fiefs and to confirm the rights of the fief heirs. He also conducted a number of important reforms with respect to administrative division, taxation ordering, relations between landlords and tenants. Numerous laws on the administration of various provinces (that regulated administrative organization, taxation, property relations and so on) were worked out. The level of administrative organization also was rather high by the contemporary standards (see, e.g., Findley 1989). During this time Turkey can be considered to be a sufficiently centralized empire, whose backbone was represented by the military fief (timar) system (see, e.g., Oreshkova 1986), whereas its center was one of the largest world cities of the century, Istanbul, whose population in 1550 is estimated to have been between 400 and 500 thousand (Petrosyan 1990: 7273, 103; see also Chase-Dunn and Manning 2002: 387).29
28
However, it cannot be excluded that the formation of the developed state may be dated to the end of the reign of Bayezid II (14811512), or the beginning of the reign of Selim I (15121520). Already during the reign of Bayezid II the Ottoman socio-political and economic institutions were put in order, a rather clear religious-legal was developed for them, which was connected with activities of a large group of the Ottoman ùlam'. In general, during the reigns of Selim I and Suleiman I Ottoman state institutions acquired that developed form, which afterwards was considered as a classical standard (Ivanov, Oreshkova 2000: 76). 29 Note that if the tradition maintaining that Selim I took the Caliphal title from the last Egyptian Abbasid Caliph after the Ottoman conquest of Egypt still had some substance (though it is generally regarded now as the late 18th century fabrication [see, e.g., Sourdel et al. 1990]), this
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Turkey was the only Eastern empire that managed for a rather long time (and not always without success) to compete militarily with some European powers and even their alliances. For more detail about the chronology of developed states existence and their number see Table 5 and Diagram 7. 8. ANALOGUES OF DEVELOPED STATES AND SOME NOTES ON THE WORLD SYSTEM POLITICAL EVOLUTION Within our systems of definitions, the first developed state (New Kingdom Egypt) appeared in the 16th century BCE. However, its formation was preceded by the formation of the developed state analogues a few centuries before (see Table 5 below). The point is that with time some early states achieved such a high level of administrative development that, to a certain degree, they could be considered analogues (though incomplete) of the developed states. We mean such polities as the Third Dynasty of Ur state and the kingdom of Hammurabi in Mesopotamia. In addition to them the first complete analogues developed (e.g., Middle Kingdom Egypt). Thus the first rise of the developed state and their analogues took place around the late 3rd millennium and the first half of the 2nd millennium BCE, which can be seen in Diagram 7 below.
Table 5. Chronological table of the formation of the developed states
Approximate date of the phase end Approximate date of the phase beginning
State
Note
Marking event
Marking event
1. The Third Dynasty of Ur Sumer 2. Middle Kingdom Egypt
-2111 Beginning of UrIncomNammu's Reign plete analogue Analogue -2000 Beginning of the 12th Dynasty
-2003 The fall of the Third Dynasty of Ur -1700 Beginning of the Second Intermediate Period
could be regarded as a rather logical measure, as it would have strengthened the power of the Ottoman sultans providing additional legitimization for their power over their subjects most of whom were Muslims (Petrosyan 1990: 5869, 72).

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State
Note
Marking event
Marking event
3. The Old Babylonian Kingdom 4. New Kingdom and Late Pharaonic Egypt 5. The New Babylonian Kingdom 6. The Achaemenid Empire 7. The Qin state in China 8. Ptolemaic Egypt 9. The Seleucid State 10. China
Incom-1792 Beginning of plete anaHammurabi's logue Reign -1580 Beginning of the 18th Dynasty
-1595 The Kassite conquest of Babylonia -525 Persian conquest of Egypt Persian conquest of Babylonia Alexander's conquest Formation of Qin Shi Huang's empire Roman conquest of Egypt Roman conquest of the remaining part of the Seleucid state Transformation of China into a mature state analogue in the final period of Kangxi's reign Fall of the Western Roman Empire
Analogue -605 Beginning of Ne-539 buchadnezzar the Great's Reign Analogue -518 Beginning of -330 Darius' reforms Analogue -350s Beginning of -221 Shang Yang's reforms -305 Ptolemy I Soter is -30 proclaimed the king of Egypt Analogue -305 Seleucus I Nicator -64 assumes royal power -221 Formation of the the late Qin Empire 17th cent. 1722 -30
11. Roman Empire 12. Sassanid Iran 13. Byzantium
14. The Abbasid Khalifate
Beginning of Oc476 tavianus Augustus' reign 227 Reign of the first 633 Arab conquest of 241 Sassanid king, Ar- 651 Iran dashir I 395 Division of the 1453 Turk conquest of Roman Empire Constantinople into the Western and Eastern ones Analogue 750 The Abbasid dy945 The final lost of the nasty coming to real political power power by the Abbasids
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Approximate date of the phase end 1398 1850s 1945 1883 1884 Approximate date of the phase beginning
State
Note
Marking event
Marking event
15. The Umayyad Analogue Khalifate in Spain
912
16. Arab Egypt
17. Cambodia (Angkor)
A part of the Ottoman Empire since 1525 Analogue
969
Beginning of Àbd 1031 The final disintegraal-Rahman III tion of the Khalifate, reign beginning of the epoch of leaders of small polities (muluk al-tawa'if) The Fatimid con1922 Formal proclamaquest of Egypt and tion of the indethe transfer of the pendence of Egypt capital to Cairo Unification of the country by Suryavarman I The late 13th century Beginning of the 1665 reign of Philippe IV 1683 the Fair The disintegration of the Khmer Empire Colbert's reforms. Beginning of France's transformation into a mature state during the reign of Louis XIV Delhi sacked by Timur Saldanha's liberal reform Beginning of transformation of Japan into a mature state as a result of the Meiji Restoration Liberation of Korea from the Japanese rule. Mature state formation in both Koreas Final French conquest of Vietnam
18. France
The early 11th century 1285
19. The Delhi Sul- Analogue 1290 tanate 20. Portugal 1385 1433 21. Japan 1392
Beginning of the Khilji Dynasty Reign of Juan I
Unification of dy- 1868 nasty, return of the capital to Kyoto
22. Korea
1392 Beginning of the Li Dynasty
23. Vietnam
1428 Beginning of the Younger Le Dynasty

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State
Note
Marking event
Marking event
24. Spain
25. England
26. Austria
27. The Ottoman Empire 28. Sweden
29. Denmark
30. Russia
31. The Mughal State in India
1834 The third revolution, 1843 formation of the constitutional monarchy regime. Beginning of Spain's transformation into a mature state 1485 Beginning of the 1688 Glorious RevoluTudors' dynasty tion. Beginning of England's transformation into a mature state 1493 Reign and reforms 1780 Enlightened Abso1519 of Maximilian I 1790 lutism of Joseph II. Beginning of Austria's transformation into a mature state 1520 Beginning of the 1908 Revolution. Beginreign of ning of Turkey's Suleiman I the transformation into Magnificent a mature state 1523 Reign of Gustav I 1771 Reign and reforms 1560 Vasa 1792 of Gustav III. Beginning of Sweden's transformation into a mature state 1536 Royal reform in 1849 July 1849 ConstituDenmark tion. Denmark's transformation into a mature state 1547 Coronation of 1801 Beginning of the Ivan IV (the Terreign of Alexanrible) der I. Beginning of Russia's transformation into a mature state 1556 Beginning of Ak- 1707 Aurangzeb's death. bar's reign Beginning of the Mughal Empire's disintegration
1479 Unification of Castile and Aragon
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State
Note
Marking event
Marking event
32. The Netherlands
33. Iran
34. Poland
35. Prussia
36. USA
37. Brazil
38. Argentine
1579 The Utrecht Unity 1815 Final delimitation 1839 of the Netherlands' of the northern borders; transforprovinces of the mation into a maNetherlands ture state 1587 Beginning of the 1925 Reza Shah being reign of Abbas I proclaimed the Shah of Iran. Beginning of Iran's transformation into a mature state 1795 The third division Late Formation of the of Poland 15th szlachta constituearly tion (the Nobles' 16th Commonwealth cent. Beginning of PrusFirst Formation of the Late sia's transformation half of Brandenburg Prus- 18th the 17th sian state cent. into a mature state cent. 1776 Beginning of the 1829 President Jackson's Independence War 1837 reforms. USA's transformation into a mature state 1822 Declaration of in- 1889 Declaration of the Brazilian Federative dependence of the Republic; beginning Brazilian Empire of transformation into a mature state 1826 Declaration of the 1853 Adoption of the constitution of the ArFederal Republic gentinean Confedof Argentine eration; beginning of transformation into a mature state
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However, for more than a millennium the early states remained absolutely dominant, whereas the forming developed state analogues turned out to be rather unstable. A new and much more sustained rise of the developed states was observed in the middle and second half of the 1st millennium BCE. Furthermore, by the early 1st millennium CE developed states and their analogues controlled a substantial proportion of the World System territory (and also the majority of the World System population lived just within this territory), as the developed states and their analogues included the largest polities of this period (the Achemenid Empire, the Ptolemaic and Seleucid states, the Qin and Han empires in China, the Roman, and later Byzantine, Empire, as well as the Sassanid Empire in Iran [for more detail see Grinin, Korotayev 2006).30 During the whole 1st millennium CE the number of developed states and their analogues fluctuated significantly in connection with the rather well known complex and dramatic events of world history (the fall of the West Roman Empire, the Great Migration, Arab conquests etc.). However, in general their number remained rather small, whereas the territory under their control sometimes decreased significantly. The same can be observed with respect to the world urban popu30
It appears necessary to stress that some states of the period in question that we classify as early states were actually at a rather high level of development and could be compared in some respects with the developed state analogues, or primitive developed states. This is accounted for by the fact that such early states were in the highest phase of this stage, that is, in the transitional early state phase when some elements of the developed state appeared (albeit in a fragmentary form). The fact that only a few early states managed to get transformed into developed ones was noticed long ago. We believe that for early states the inability to get transformed into developed states was normal, whereas the ability to do so should be rather regarded as a positive exception. Within such circumstances, on the one hand, the development could continue; however, due to the enormous difficulty of the respective evolutionary breakthrough, such a development could acquire special forms, as a result of which such political systems could reach rather high levels of sociocultural complexity without being transformed into developed states. One of the most salient examples of political systems that overgrew significantly the level of a typical early state without being transformed into a developed state is represented by the Indian Maurya Empire that demonstrated a rather high level of administrative elaboration. This could be judged, for example, on the basis of data supplied by famous Arthastra whose authorship is ascribed to Kautilya (traditionally identified with Chandragupta's [c.320293 BCE] minister Chanakya). Though most indologists treat Arthastra's description of the Mauryan political system in a rather skeptical way (see, e.g., Lelioukhine 2000), the question that we inevitably confront is how its author could give such a convincing description of such complex (and so adapted to the Indian conditions) state organization if he had seen nothing comparable in reality. Other examples of such overgrown early states that did not manage to get transformed into the developed states are represented by a number of medieval polities of the early 2nd millennium CE, e.g., the Khwarezmshahian Empire.
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lation and urbanization rates (see Korotayev, Grinin 2006). All this is rather congruent with those theories that maintain that the 1st millennium CE was a period of deep qualitative transformation of the World System and the whole historical process; the first millennium CE was the period of preparation for a new qualitative (and quantitative) breakthrough in the field of technologies and production as a whole (for more detail see: Chapter 1, see also Grinin 2006e, 2006f, 2006g, 2007f, 2007k).31 A new technology qualitative breakthrough (or what one may refer to as the transition to a new production principle) can be dated to the mid-15th century, though some if its signs can be discerned in the 13th and 14th centuries (see: Chapter 1, see also Grinin 2006e, 2006f, 2006g, 2007f, 2007k for more detail). The same dynamics can be traced with respect to the number of developed states and the territory controlled by them. The subsequent growth in urbanization (caused by the transition to industrial production) led not only to the victory of the developed states over the early ones (see Diagram 7), but also to the formation of a new evolutionary type of state: the mature state, which was tightly connected with industrialization and the industrial economy.
Diagram 7. Growth of the number of developed states
Average number of developed states and their analogues (units per period) 18 16 14 12 10 1 cent. BCE 4 62 8cent. cent. 117 2117 1612 BCE CE 6 - 2622 cent. cent. cent. cent. BCE BCE BCE 3 3 BCE 41,2 1,2 1,2 0,2 1014 cent. 5,2
1519 cent.
15
59 cent. 3,2
Periods (each period's duration is 500 years)
31
We mean the so-called early industrial revolutions of the first half of the 2nd millennium CE; see, e.g., Bernal 1965; Braudel 1973, 1982, 1985; Hill 1947; Johnson 1955.
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9. MATURE STATE The first initial (primitive) mature state (France in the reign of Louis XIV) appeared in the late 17th century. Yet, only in the 19th century they became dominant in Europe and the New World (see Table 6 and Diagram 8). Finally, by the end of the 20th century this type of state was prevalent everywhere, except possibly certain parts of Tropical Africa and Oceania. So in general, the mature state is a result of the development of capitalism and the Industrial Revolution; thus, it has a radically different production basis than previous state types. In addition to this, the transition to the mature statehood (or its analogue) is connected with the demographic revolution. Almost in every industrialized country a very rapid, explosive population growth was observed (see, e.g., Armengaud 1976; Korotayev, Malkov, Khaltourina 2006a; Grinin 2007a, 2010a). The mature state significantly surpasses the developed state with respect to the complexity and efficiency of its political organization and legal system; it necessarily has a professional bureaucracy with its definite characteristics (see e.g., Weber 1947: 333334), distinct mechanisms and elaborated procedures of the legitimate transition of power. The mature state can be defined as a category that denotes an organic form of political organization of an economically and culturally developed society, a system of bureaucratic and other specialized political institutions, organs and laws supporting the internal and external political life; it is an organization of power, administration, and order maintenance that is separated from the population and that possesses: a) sovereignty; b) supremacy, legitimacy and the reality of power within a certain territory and a certain circle of people; c) a developed apparatus of coercion and control; and d) the ability to change social relations and norms in a systematic way. It makes sense to pay attention to the point that the developed state is defined as a natural form of the political organization of society (that is, though the developed state is necessary to sustain social order in a supercomplex agrarian society, in principle, its main agricultural population could do without state, let alone a large state if there were no threat of external invasions). In contrast, the mature state is defined as an or-
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ganic form of the political organization of a society, that is, such a form without which a respective type of society (and its population) could not reproduce itself in principle. In the meantime, statehood itself becomes virtually separated from concrete persons. In the monarchies of the initial period of the mature states a monarch (like Louis XIV) could still claim: L'tat, c'est moi!,32 whereas in the constitutional regimes this became just impossible. We can also observe the development of certain autonomy of the bureaucratic apparatus and army that more and more act as an abstract mechanism of civil service.33 All these serve as a basis for the formation of civil society.34 So France can be regarded as a mature state since the late 17th century. Let us mention just one telling example: by the early 16th century there were 8 thousand officials in France, whereas by the mid-17th century their number grew to 46 thousand (Koposov 1993: 180). In England the mature statehood formed in the first decades of the 18th century, that is, some time after the Glorious Revolution of 1688, the overthrow of James II, and the enthronement of William III of Orange, when a new system of state control began to form: constitutional monarchy, the two-party system, and a single-party government. In Prussia the mature statehood had existed since the late 18th century. By the early 19th century within military, as well as civil, administration it established standards for whole Europe (Parsons 1997: 100). In Russia it has existed since the early 19th century since the reforms of Alexander I and Mikhail Speransky. In Japan it appeared in the last third of the 19th century (after the Restoration of Meidji). The USA became a mature state after the period that is denoted as Jackson's Democracy named after the President Andrew Jackson (18291837) when
32
33
34
But even Louis XIV admitted at least openly that the state's welfare is the first duty of the king who has some obligations to the subjects (Lysyakov 2002: 199). Even in totalitarian countries their rigid ideologies, popular ruling parties, and other institutions existed formally for the well-being of the people and society, which restricted significantly the opportunities of the officials' personal self-enrichment. Naturally, in the initial (primitive) phase of the mature statehood we find some archaic features that are inherited from the earlier epochs, a certain weakness of the state. For example, in France in the 18th century the sale of governmental posts continued, the internal customs remained, whereas in Russia the serfdom survived until 1861. Later such archaisms disappear as a result of evolutionary and revolutionary transformations.
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we observe the formation of a two-party system and the abolition of the electoral qualification system. China can be regarded as a mature state analogue since the late 17th century or the early 18th century (the final period of Kangxi's [1661 1722] reign). This state managed to organize politically an enormous (even from the present-day point of view) population against the background of its very fast (for the 18th century) demographic growth (McNeill 1993: 240244). During the 18th century the Chinese population grew from 100150 to over 300 million (Kryukov et al. 1987: 6163; Korotayev, Malkov, and Khaltourina 2006b: 4788; McNeill 1993: 240). In Qing China we can also observe a rather high level of administrative technologies, a number of social innovations atypical for developed (but not mature) states (for more detail see Grinin 2006d, 2006g, 2007a, 2007b, 2007i, 2010a). The main characteristics of the mature state: a) it is already an industrial or industrialized state where a unified economic organism integrated by effective communications is formed. The ensuring of its normal functioning becomes a more and more important task of the state. An important role is also played here by military needs; b) it has a sufficiently high level of administrative organization, a developed system of laws, or state regulations (as was found in the states of the Communist Block). In the mature state, administration institutions, as well as the apparatus of coercion and control, are both more elaborated and more specialized than in the developed state; while in the latter those organs and institutions far from always had clearly demarcated functions. In the developed state both supreme and local administrative organs were often multifunctional and unclear with respect to their tasks.35 Real bu35
For example, in the 16th century in France (as well as in Russia and other countries) we find the narrow council of the king whose composition was indefinite and whose functions were rather vague. The same can be said about the representatives of the contemporary administration bailliages, snchausses, prvts, gouverneurs with their extremely indefinite administrativejudicial and military-administrative jurisdiction (Skazkin 1972: 170, 171). Outside the court and government the classical monarchy is characterized by a partial, and sometimes weakly centralized system of administration. The situation only began to change in the 17th century, especially under Richelieu (Le Roy Ladurie 2004: 15).
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reaucracy was only concentrated primarily within certain spheres that were different in different countries (e.g., in taxation, or courts of law), whereas it could be absent in the other spheres of life, especially at the level of local government.36 And such a situation did not always change immediately at the level of the primitive mature state (cf., for example, the situation in France in the 18th century [Malov 1994: 140]), whereas it is changed in really systematic way only at the level of the typical mature state (for more detail see Grinin 2007a, 2010a); c) a new political regime is established: the representative democracy or one-party state. There are usually present the worked out forms of constitutions and the division of powers, and the role of law (especially civil law) significantly increases. In general, in mature states the systems of law and court procedures reach a level of development and elaboration that it appears difficult to compare them with the ones of earlier epoch (in totalitarian and authoritarian states instead legal branch we observe very complex political-administarative system); d) one of the most important functions of the mature state is to secure not only the social order, but also the legal order, which was often paid little attention by the developed states; e) mature states politically organize societies, where estates have disappeared, the industrial classes have formed. In connection with the growth of the role of property relations, the establishment of legal equality of the citizens, the abolishment of the privileges of the estates, the mature state is gradually transformed from the estate-class state to the purely class-corporate state. Thus, here the role of new industrial classes (bourgeois and employees or the analogous groups of the socialist nomenklatura and employees), dramatically increases within the state system. As the class division is mostly economic (see, e.g., Weber 1971, 2003), and not juridical, it becomes necessary to have organizations and corporations that express the interests of certain parts and groups of certain classes (and sometimes interests of a certain class as a whole). These are various organizations and political parties
36
Even in pre-Modern China the bureaucratic apparatus did not penetrate the local level where the administrative functions were performed by the literati (see, e.g., Nikiforov 1977: 211213).
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of both workers and bourgeoisie (see, e.g., Bergier 1976; for more detail see Grinin 2010a), as well as other social strata.37 f) it is based on the modern type of nation (or a set of nations), nation-state formed, that is why it can only exist within a society with a unified national (or supranational) culture (about the tight relations between the nation and the state see e.g., Armstrong 1982; Gellner 1983; Freidzon 1999: 1012; Grinin 1997; 2006e: 201203, 222235; 2009d). In the developed states mass literacy was almost never observed, written information sources were controlled by the elites, whereas the mass literacy is normal for mature states were written information sources became available to the general population already in the 18th and 19th centuries and where the importance of mass media grew enormously. This stimulated radical changes in the forms, styles and directions of administration and contacts between the government and the people. That is why such a state is concerned with its influence on culture, including control over language, religion, education and so on. Hence, the ideology of the mature state always includes some nationalism (or some other ideas about the superiority of the given state's population; for example, its special progressiveness, revolutionary spirit, love for democracy/freedom, certain historical deeds, etc.); With respect to the relations between the state and society that is, the state and the person we find it necessary to speak about the formation of a new type of ideology that can be denoted as civil ideology, because it explained the relations between the person and the state from the point of view of the person-citizen who had equal legal rights and duties and lived in a nation-state. As a result of revolutions, reforms and proliferation of education this civil ideology gradually replaced the sacred traditional ideology of the developed state that implied the sanctity of the monarch's power and the inviolability of the estate social order.
37
For example, in Britain the first national federation of the entrepreneurs' unions appeared in 1873; in Germany 77 various entrepreneurs' organizations were created in the 1870s, whereas in the 1890s 325 new organizations of this type appeared (Grigorieva 2001: 25) It is necessary to take into account the fact that within the context of a developed class stratification even purely economic corporations cannot remain politically neutral. In particular, the trade union movement with its growth and reinforcement inevitably tries to influence the state and its economic and social policies (Shlepner 1959: 386).
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Nationalism can be considered as the most universal type of civil ideology. Liberalism, democratism, revolutionism, and reformism can be regarded as other influential ideologies of the age of classical capitalism. The later period observed the formation of imperialism (as an ideology), communism, fascism, and anticommunism. As a result, the very criteria of the state's dignity changed. The splendor of the Court was replaced with the economic power of the nation, a more just social order, and, subsequently, the quality of the population's life as the criteria for judging the level of state development. Thus, the mature state bases itself on new types of infrasocietal links: material links unified economic organization and unified market; cultural links unified culture-information organizations; national links consciousness of national unity and development of new symbols of this unity: nation, national interests, supreme interests; consolidation on the basis of ideology: cult of law and constitution, cult of nation; consolidation on the basis of participation in pan-national organizations and corporations (trade unions, parties, movements) and participation in pan-national elections.
Table 6. Chronological table of the mature states' formation
Year 1500 1600 1650 1700 1750 1800 Mature states and their analogues 0 0 0 3 (France, Britain, China38) 3 (France, Britain, China) 7 (France, Britain, Austria, China, Russia, Prussia, Sweden) States in the phase of transition to the mature statehood 0 0 3 (France, Britain, China) 0 4 (Austria, Prussia, Russia, Sweden) 6 (Denmark, Italy,39 Spain, Portugal, the USA, the Netherlands)
38 39
China before 1900 is regarded as a mature state analogue. It may be maintained that with the Napoleonic conquests in Italy and the formation of a united Italian state (first a republic, and then a kingdom under the French protectorate) Italy began to move rather fast towards mature statehood. We believe that the transition of a number of Italian states (Venice, Florence, Genoa) to developed statehood took place already in the 15th century, but because of constant wars, invasions, internal influences, instability of interstate boarders and states themselves the political development of Italy slowed down in the subsequent centuries.

Year 1850 Mature states and their analogues 14 (France, Britain, Austria, China, Russia, Prussia, Sweden, Belgium, Denmark, Spain, the USA, Piedmont [Italy], Switzerland, the Netherlands) 25 (Argentine, Austria-Hungary, Belgium, Brazil, Britain, Bulgaria, Chile, China, Denmark, France, Germany, Greece, Japan, Italy, Luxemburg, Mexico, the Netherlands, Portugal, Rumania, Russia, Serbia, Spain, Sweden, Switzerland, the USA)
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States in the phase of transition to the mature statehood 6 (Argentine, Brazil, Mexico, Portugal, Chile, Japan)
1900
19 (Australia, Canada, Cuba, Egypt, Finland, Iceland, India, Iran, Ireland, Korea, New Zealand, Norway, Pakistan,40 Philippines, Poland, the South African Union, Turkey, Uruguay, Vietnam)
The overall dynamics of the number of mature states is presented in Diagram 8. Diagram 8. Dynamics of the mature states' number (15001900 CE)
10. ADDITIONAL COMPARISON BETWEEN EVOLUTIONARY TYPES OF STATE The above mentioned evolutionary types of states differ among themselves also by a number of other characteristics. In particular, it appears
40
The prospective Pakistan state as known, was the part of British Empire populated mainly by the Muslims.
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necessary to pay attention to these differences with respect to the interaction between centralized power, the elite, and the commoners (population). In the present chapter, the model of interaction for the triangle CENTER ELITE COMMONERS (POPULACE, PEOPLE) within each evolutionary type of state can be only presented as short descriptions of one of the most typical situations (see Grinin 2007a, 2007b, 2007i for more detail). These schemes, which are presented only as one of possible models of such interaction, look as follows. In the early state we frequently observe a situation where the elites, basing themselves on their resources (lands, clients, military force) or their special position (as recognized representatives of certain lineages or dynasties, heads of tribal formations and so on), control, in some way or another, a very large part of the territory of a respective country, or even most of it. The commoners find themselves under the jurisdiction and effective control of the elites and they are required to perform state duties. A considerable part of the commoner population (especially serfs, slaves and so on) find themselves altogether out of the state's jurisdiction. Within such situations the center turns out to be actually an aggregate of the elites' forces (both regional elites and the ones represented in the capital). Frequently the center cannot organize the main functions of the state without elites, because the state does not possess yet the necessary apparatus, or this apparatus is rather weak. Thus, the interrelations between the commoner population and the center are mediated by the elites to a very considerable degree. As a result, the elites take control of the territorial-functional institutions, in particular the fixation of duties, tax collection, judiciary, organization of military forces and defense, land distribution (this is frequently combined with the elites' immunity and autonomy as a sort of payment for the performance of such functions). We can mention as examples of such early states the medieval states of Europe, such as the Frankish state in the 8th 10th centuries, England (both before the Norman conquest and some time after it), German states in the 10th 15th centuries, Kievan Rus and Muscovy up to the age of Ivan III. This is typical for many ancient and medieval states outside Europe (e.g., for Mesopotamia after Hammurabi, for the Hittite Kingdom, for Chou China, considerable parts of the Japanese history, and so on). In the developed state the elites are significantly more integrated in the state system, thus they are much more connected to the center.
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In comparison with the early state, the developed state possesses a considerably larger and much more sophisticated administration apparatus. However, it is only represented systematically in the center, whereas at the periphery it is rather fragmentary. That is why here the elites still act as a component of the regional state apparatus, especially with respect to the military functions, but also frequently with regards to general administration, taxation, judiciary, religious subsystem and so on. In particular, large landowners frequently performed taxation, judiciary and administrative functions; the taxes were collected by taxfarmers and the police functions would be performed by representatives of special social groups (e.g., in the Ottoman provinces they were performed by the Janissaries [see, e.g., Kimche 1968: 455]). This point does not contradict the idea that the developed state is more organically connected with the society than the early one does. Within the developed state the relations between the center and the commoners are both direct and indirect, that is, they are partly mediated by the elites, but partly these relations are conducted directly through the formal and official local state apparatus. In the meantime the commoners rely more and more on the center as a possible protector against the arbitrariness of the local elites, which is much less typical for the early state. In the mature state its administrative-bureaucratic apparatus becomes quite systemic and complete, which makes it possible for the center to conduct its interaction with the commoner population directly. In the mature state it appears more accurate to speak about the interrelations between the elites, the populace, and the state (rather than the center). We observe the relationships between the state and the elite becoming civil. This means that the elites (that is, large-scale landowners, businessmen, financiers, as well as the intellectuals' elite) stop performing the direct functions of the state structures, these functions are now performed almost entirely by the formal, official state organs; that is, the elites can be regarded as a part of the civil society, no longer as a part of the state. However, the elites' privileges and status are still protected by the state. All these contribute to the formation of civil society. The relations between the state and the population are direct and immediate both through the state apparatus (e.g., through taxation or judicial organs), and through the participation of the populace in elections.
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Summing up one may say that in the early state the center only unites (quite weakly) the territories and population through the mediation of the elites that provide most of the direct interaction with the populace; in the developed state the center directly or indirectly integrates the elites into the state apparatus, limits the elites' influence on the populace, establishes some direct relations with the populace; the mature state (with the help of a rather sophisticated administrative apparatus and elaborated legal system that it possesses) eliminates the administrative-territorial control of the elites over the population, transforms the elites into a part of the civil society, and establishes systematic direct links between the state and the populace. 11. MATURE STATE TRANSFORMATION IN THE 20th CENTURY The mature state developed due to the formation of the classes of entrepreneurs and employees and the emergence of the class-corporate state. For the mature states of Europe, this process was completed by the end of the 19th century. Gradually, however, the social classes began to diffuse and turn into fragmented and less consolidated groups, such as strata, layers, and so on. This transformation is determined by very rapid changes in production, demography, and education.41 This occurred in Europe in the first half of the 20th century. Such a transformation of the mature state is connected with very fast changes in production and related spheres, including acceleration of migration processes, creation of conveyor production, explosive growth of the education subsystem, the service spheres, women's employment, and so on (on some of these processes see, e.g., Marshall 2005 [1959]: 23). Suffice to mention that the world industrial production grew between 1890 and 1913 four times (Solovyov, Yevzerov 2001: 280). The most important features of the new social structure are the following: the formation and development of the middle class that gradually became numerically dominant (Fisher 1999: 89);
41
We think that the fuller is the legal equality of human rights, the weaker are the borders between social classes that tend to get disintegrated into smaller and less consolidated groups: strata, factions, etc. (for more detail see Grinin 1997b: 6162).
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growth of the importance of such factors of social stratification
signs, such as education and social mobility (Fisher 1999: 91); and, consequently, the proportion of white collar workers grew in the most significant way; the increased impact of social legislation and laws, limiting society polarization (high income taxes, inheritance taxes, etc.)42; and the strengthening of previously insignificant factors, such as gender, age, and professional-group characteristics. Let us see these transformations in retrospective. Actually, the whole first half of the 20th century can be characterized as a period of struggle for the introduction of the most important social laws. The respective views and ideologies were changed dramatically by the global social and economic events: revolutions, the example of the USSR, the world economic crisis and so on. Sometimes quickly sometimes gradually social policy experienced radical changes. Later this course was strengthened and developed (on this dynamics of social development see Fisher 1999: 335351). Immense changes took place in the sphere of income redistribution. This was achieved, in particular, through the progressive income taxation (see, e.g., Ibid.: 8687) and social welfare programs for low-income groups. As a result of the development of social programs the taxation rates grew significantly in comparison with the period of classical capitalism (reaching 50 % and more of personal income).43 When in the 1950s and 1960s the USA and a number of European countries became welfare states / mass consumption societies, this implied that the mature state had acquired some features that were not typical of its earlier version, and that a new form of state had developed. Since we can observe the transformation of the mature class state
42
In the last decades of the 20th century in some developed countries the lower class shrank to 5 %, the upper class constituted less than 5 % of the total population, whereas the rest of the strata could be attributed to the middle or lower-middle classes (see Fisher 1999: 89), whereas in the early 19th century up to two thirds of the total population belonged to the lower class (Ibid.). 43 They only began to be reduced since the 1980s in connection with the introduction of the neoconservatist course (that corrected the previously dominant Keynesian one) into the economic policies of a number of the leading states, such as the USA, Britain and so on. In particular, in the USA in 1986 the upper limit of personal income taxation was reduced from 50 to 28 %, whereas the maximum rate of taxes on the corporations' profits was reduced from 46 to 34 % (Povalikhina 2002: 434).
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into the mature social state, that is the state that actively pursues a policy to provide support for poor, socially unprotected groups and that places limits on the growth of inequality. In the 1960s new changes in all spheres of life (especially in connection with the new [information-scientific] production revolution) began. In particular, one could mention the growth of the role of various nonclass social movements in the Western countries (student, youth, race, green, women movements, consumers' organizations and so on). The class characteristics became more and more vague, among other things through the dispersion of ownership (see, e.g., Dahrendorf 1976), whereas the social structure became determined more and more not only by economic ownership, but by other parameters, including education and popularity.44 Thus, many present-day characteristics of the Western states cannot be regarded as definitely the ones of the mature state. Moreover they have features that are uncharacteristic also of the state as a political organization in general. Especially noteworthy is the extremely important and seemingly strange phenomenon of partially waiving legal sovereign rights. It is also necessary to note the formation of various supranational organizations and the growth of their importance. That is why there are certain grounds to expect that the end of the period of the mature states is forthcoming, and the world is entering the phase of its new (suprastate and supranational) political organization (for more detail see Grinin 1999a; 2006e: 159165; 204206; 234235; 2008a, 2009a, 2011b). Concerning the changes of statehood and transformation of national sovereignty in the last decades of the 20th and the early 21st centuries see Chapter 5 (see also Grinin 1999a, 2004b, 2005, 2008a, 2009a, 2011b). 12. CONCLUDING REMARKS The fact that our three-stage theory has been suggested as a more acceptable alternative to Claessen Skalnk's two stage scheme was
44
See, e.g., Parsons 1997: 27; Berger 1986; see also our works providing the analysis of the contemporary social processes, in particular those connected with the so-called celebrities (e.g., Grinin 2009i).
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agreed with Henri Claessen himself who with his inherent scholar and human generosity wrote: Grinin goes deeply into the matter, and shows that the dichotomy early-mature is an incomplete developmental sequence. According to him there are structural differences between the cases suggested by us, and states with a capitalistic and industrial background (imperial Germany, United States, Russia etc.). He therefore proposes a sequence of three types, early states, developed states and mature states. In this way he places a separate category between the early and the mature state... We greatly appreciate the way in which Grinin augmented and improved our work. With this classification a serious gap in the evolution of the state is closed (Claessen et al. 2008; see also Claessen 2010: 35 etc.).
Part II GLOBALIZATION: ECONOMIC AND POLITICAL ASPECTS

Chapter 4 Economic Aspects of Globalization
Section 1. THE THEORY OF ECONOMIC CYCLES AND CURRENT GLOBAL CRISIS Though the issue of economic cycles has been subject to numerous studies, this problem has retained its high importance. What is more, the current crisis has confirmed in an extremely convincing way the point that, notwithstanding all the success achieved by many states in their countercyclical policies, no economy is guaranteed against uncontrollable upswings and unexpected crises and recessions that tend to follow those upswings. In addition to this, the financial globalization has increased substantially the risks of such cyclical fluctuations. The notion of economic cycles is regarded ambiguously in economic science. In modern theories, business cycles are frequently defined as fluctuations of actual output around its potential value which is achieved in full employment conditions (see, e.g., Fischer, Dornbusch, and Schmalensee 1988). However, quite frequently economy does not achieve on the rise the potential GDP volume when a recession phase starts (such situations are described in more detail in Grinin, Korotayev 2010: ch. 1). Thus, economic cycle, in our opinion, can be defined as a periodical fluctuation around the medium
Chapter 4. Economic Aspects of Globalization
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line of production volume, where repeating phases of rise and decrease can be specified. In the proposed below model we have tried to briefly describe the main features of medium-term cycles of business activity, or business cycles (711 years)1 that are also known as Juglar cycles after the prominent 19th-century French economist Clement Juglar (18191905), who investigated these cycles in detail (Juglar 1862, 1889).2 1. ON SOME APPROACHES OF ECONOMIC SCIENCE TO THE PROBLEM OF CYCLICITY AND ECONOMIC CRISES Juglar investigated fluctuations of prices, discount rates and gold reserves of banks in France, England, and the USA and showed their correlation with cycles of increasing business activity, investments (and speculations), and employment (Juglar 1862, 1889). The first edition of his book was published in 1862. In the Introduction he wrote:
It appears that crises, like diseases, are one of the conditions of the existence of those societies where trade and industry are prevalent. One can predict them, alleviate them, delay them up to a certain moment, one can facilitate the recovery of economic activities; but it has turned to be impossible to eliminate them notwithstanding all the possible methods that have been applied (Idem 1862: vii).
Juglar's most important achievement lay in presenting substantial evidence that crises were periodical, i.e. in support of the law of crises' periodicity. According to this law, crisis is preceded by epochs of recovery, well-being, and price growth, which are followed by years of price decrease and trade slowing down that bring economy into a depressed state (Idem 1889: xv). It is namely with Juglar's contribution to the analysis of periodical crises that the transition of economics as a whole from crisis theory to business-cycle theory is frequently connected (Besomi 2005: 1).
1
Many economists maintain that business cycles are quite regular with the characteristic period of 711 years. However, some suggest that economic cycles are irregular (see, e.g., Fischer, Dornbusch, and Schmalensee 1988). As we suppose, a comparative regularity of business cycles is observed rather at the World System scale than in every country taken separately. This corroborates the important role of exogenous factors for the rise and progress of business cycles (for more detail see below). 2 Medium-term cycles (711 years) were first named after Juglar in works by Joseph Schumpeter, who developed the typology of different-length business-cycles (Schumpeter 1939, 1954; see also Kwasniki 2008).
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Thus, crisis does not occur randomly (it is erroneous to ascribe its occurrence to random factors).3 It is preceded by an intensive increase in business activities and prices, which sometimes allows one to predict a crisis in advance.4 According to Tugan-Baranovsky (2008 [1913]: 294), Juglar successfully coped with this task on a number of occasions. A few notes on Juglar cycles (which will be also denoted as J-cycles below). Let us turn to a brief description by Tugan-Baranovsky of the economic cycle scheme proposed by Juglar:
Industrial crisis never comes unexpectedly: it is always preceded by a special heated state of industry and trade whose symptoms are so specific that an industrial crisis may be forecasted in advance What causes these regular changes of booms and busts? Juglar indicates one main cause: periodic fluctuations of commodity prices. The prosperous epoch that precedes the crisis is always characterized by the growth of prices: Annual savings of civilized nations (that enlarge their wealth) also lead and sustain the constant growth of prices: this is a natural state of market, a prosperous period. The crisis approaches when the upward movement slows down; the crisis starts when it stops The main cause (one may even say the only cause) of the crises is the interruption of the growth of prices (Juglar 1889: 33). The overall mechanism of the crisis development is specified by Juglar in the following way. The increase in commodity prices naturally tends to impede the sales of respective commodities. That is why with the growth of prices the foreign trade balance becomes less and less favorable for the respective country. The gold starts to move abroad to pay for the imports whose amounts start to exceed those of exports. At the beginning the amounts of gold moving abroad are negligible and nobody pays attention to this. However, the higher the prices, the greater the amount of gold that moves abroad. Finally, the commodity prices reach such a high level that selling the respective goods abroad becomes highly problematic. As the traders cannot cover the import expenses with the export revenues,
3
Notwithstanding the belief of some influential modern economists in the contrary (see, e.g., Zarnowitz 1985: 544568; Mankiw 2008: 740). 4 It is worth mentioning here that, before Juglar, the prevailing views were based on Adam Smith's ideas of invisible hand and on Say's law of markets. According to such views, equilibrium state is considered to be the main one for the market, various shifts from it being caused by some external factors. Consequently, crises are also caused by random factors. However, currently these ideas (those of external shocks) are rather popular again. We will consider this issue in more detail further on.
Chapter 4. Economic Aspects of Globalization they have to renew their promissory notes in banks after the payment deadline, and this accounts for the intensification of the discounting operations of the banks in the period that directly precedes the crisis. Yet, the payments cannot be delayed forever; sooner or later they should be made. The commodity prices fall immediately, this is followed by bankruptcies of banks and traders, and the industrial crisis begins (Tugan-Baranovsky 2008 [1913]: 294295).
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It can be seen that the central mechanism of cyclical fluctuations, in Juglar's opinion, is the fluctuation of prices, their increase leading to recovery and upswing, their decrease being followed by crisis and depression. The exceptionally important role of price fluctuations is indisputable; it has been noticed by economists belonging to various schools (see, e.g., Haberler 1964 [1937]). Among them one can mention such contemporaries of Juglar as Karl Marx and Friedrich Engels. In Tugan-Baranovsky's opinion (Tugan-Baranovsky 2008 [1913]), which we are ready to agree with, Juglar's theory, however, does not explain adequately enough the main point, namely the increase in commodity prices in the period that precedes the crisis. Subsequent researchers described numerous mechanisms of such an increase, ranging from interest rate fluctuation, credit expansion and reinvestment to the behavior of aggregate demand and aggregate supply curve, as well as psychological factors such as ungrounded optimism. Nevertheless, the issue is still subject to vigorous academic discussions. Tugan-Baranovsky himself suggests that crises are caused by lack of capital, as in the upswing period capital is spent faster than it is accumulated. As a result, both credit and impulse to development are exhausted, while structural disproportions lead to crisis phenomena (not necessarily in the form of an acute crisis; he was right in stating that the crisis intensity depends on the intensity of upswing). Tugan-Baranovsky emphasizes (and we would agree with him on this point to a certain degree) that the school of Marx and Engels suggested the deepest understanding of crisis for their time. According to them, crises are caused by over-production (which is a consequence of the main contradiction of capitalism). Overproduction itself is stipulated, first of all, by the anarchic character of capitalist production; secondly, by poverty of masses, their exploitation, and the tendency of salaries to decrease. As a consequence of constant growth of capital's organic structure (i.e. the decline of the proportion of salaries in total production expenses), according to Marx,
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the profit rate falls.5 Capitalists try to overcome the profit rate reduction by introducing new machines, which leads to labor productivity growth. This leads to the expansion of the commodities' supply and, consequently, to their overproduction (because of the anarchy of capitalistic production). Crisis is namely the explosion of capitalistic production contradictions, and, consequently, the restoration of equilibrium. Some Marxist economists provided fundamental descriptions of the history of crises (see, e.g., Mendelson 19591964; Varga 1937; Trakhtenberg 1963 [1939]). However, Marx and Engels, in our view, failed to show the true connection between processes of production and circulation (the latter were ignored as an allegedly less fundamental part). Thus, they were not capable of revealing the causes of crisis explosiveness and dramatic change of situation at so-called turning points (i.e. from boom to acute crisis and from the bust to recovery and boom). In the first half of the 20th century, numerous theories explaining economic cycles were already present. In fact, the under-consumption theory was one of the oldest, as such views appeared long ago (actually, together with the science of political economy itself). Among its earliest followers, Lord James Lauderdale, Thomas Malthus and Jean Sismondi were the most prominent. In the first half of the 20th century, a significant contribution to scientific re-consideration and diffusion of the under-consumption theory was made by John Atkinson Hobson, William Foster, Waddill Catchings, Emil Lederer. Essentially concordant with its ideas were some of the abovementioned approaches of the Marxist orthodox school, which assumed that the working class condition, according to the law of working class absolute impoverishment put forward by Marx, must worsen.6 Monetary theories saw causes of cyclicity mainly in the cumulative character of business activity expansion and contraction depending on the amounts of money in the economy.7 The most vivid example is Haw5 6
Phenomenon marked by economists of various schools but explained in different ways. However, such explanation has become an anachronism long ago. The given theory correlates very badly indeed with a long-term trend to an unprecedentedly fast (against the general historical background) increase in life standards (and real incomes) of direct producers in general, and of the working class in particular. This trend is rather typical for capitalist countries and is observed in reality. 7 It should be noted that, from the point of view of General Systems Theory, this point is essentially related to the issue of positive feedback loops, which will be considered in more detail further on.
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trey's theory (see, e.g., Hawtrey 1926, 1928). For him, trade-industrial crises appeared to be purely monetary phenomena, as, in his opinion, monetary flow change suffices to explain the transitions from upswings to depressions (and vice versa). On the whole, undoubtedly, the monetary component of cyclicity and crises is very important. However, representatives of monetary theories attributed too dominant a role to monetary factors, thus ignoring non-monetary causes. One of the versions of the over-accumulation theory is based on Tugan-Baranovsky's ideas. Haberler (1964) divides representatives of the theory into followers of its monetary and non-monetary versions. The first group includes those economists who suggest that monetary factors, acquiring great importance with credit expansion, cause strong disproportions between economy sectors producing consumer items and capital goods (or, more exactly, between sectors of the whole manufacturing chain). The followers of this version of the theory in question have made a particularly valuable contribution to the analysis of disproportions in production structure caused by the credit expansion at the phase of boom and prosperity, as well as to the interpretation of crisis as a result of those disproportions. Representatives of this direction include Friedrich von Hayek, Fritz Machlup, Lionel Robbins, Wilhelm Roepke, and Richard von Strigl. Numerous representatives of this direction belong to the socalled Austrian School, which started from the works by Ludwig von Mises (1981 [1912]; 2005). It reveals the most important cause of crises in state interference into economic processes, particularly in artificial credit expansion. Special attention is given to the role of central banks in crisis generation (see, e.g., Huerta de Soto 2006; Skousen 1993; Rothbard 1969; Shostak 2002).8 The other, non-monetary direction of over-accumulation theory is represented by the authors whose theories are based on taking into account the non-monetary factors: inventions, discoveries, creation of new markets etc., that is factors securing favorable conditions for new investThe action of these feedbacks can lead to phenomena perceived as booms, collapses, and breakdowns (see, e.g., Sornette 2003). A group of economists who developed the so-called acceleration principle may be specified as a separate direction. According to this principle, the changes in consumer goods production cause, due to technological reasons, much sharper fluctuations in goods production sector, as investments into main capital require much more time and expenses. This causes a general demand increase, which eventually turns out to be greater than required for optimal development, which creates prerequisites for crisis origin (see, e.g., Haberler 1964).
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ments. This direction is represented by Gustav Cassel, Peter Hansen, Arthur Spiethoff, and Knut Wicksell. Works by Arthur Pigou and Joseph Schumpeter are essentially close to this direction as well. Psychological theories are also worth mentioning. Even though every economic phenomenon has its psychological aspect, some theories (not without grounds) when interpreting different cycle phases assign a special importance to psychological reaction that can considerably increase disproportions, make a new phase occur faster or slower, contribute to business activity increase or hinder it, etc. Among the representatives of psychological theory, one may mention such prominent economists as, for example, John Keynes, Frederick Lavington, Arthur Pigou, and Frank Taussig. In some aspects they ascribe to psychological factors (such as optimism, pessimism, euphoria, panic) a capacity to produce a relatively independent impact (for more detail see Grinin 2009g). Theories of economic crises can be classified in various ways. For example, they can be segregated into exogenous and endogenous ones (see, e.g., Morgan 1991), which is closely connected with approaches to the explanation of the nature of equilibrium state in economy. We take it as a basis that, though cyclicity has an endogenous structure being connected to occurrence of structural disproportions, still crises cannot occur without exogenous impacts. Essentially, the economy of a given country cannot be regarded in an isolated way, as the economic field is always much broader than the one of an isolated economy. It serves as a part of the World System economic field, so in reality external impacts must necessarily be observed (see Grinin, Korotayev 2010a for more detail). The following important aspect must also be taken into consideration: while crisis in a given country may have first of all an endogenous character, its process and characteristics may possess substantial peculiarities in comparison to crisis in countries where it is caused by exogenous factors. In particular, in modern conditions many countries, for example, China, India, or Russia, have not exhausted their development resource. Crisis in these countries occurred just under the influence of a sharp change in external conditions. And, as external conditions of every country form a unique combination, crisis would have important peculiarities in each particular case. At the same time, in the USA the crisis was more of endogenous origins, as the country's eco-
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nomic development resources had been worn out to a greater extent than that in many developing countries. Such a situation is generally (though, of course, not always) typical for the development of crises in the World System core, on the one hand, and in its periphery, on the other. In the centre crises have a more endogenous character, while in the periphery their origins are usually more exogenous, as they tend to be caused by economic fluctuations in the World System centre. Thus, every crisis always has both endogenous and exogenous causes, but their combination is specific for each particular society in every particular period, which makes the situation unique for any society and for any crisis. Kondratieff (2002: 1114) divided all approaches firstly into the ones regarding economic phenomena as static, considering static equilibrium state in economy as basic, and all deviations from such equilibrium as disturbances. Among the followers of this approach Kondratieff named William Jevons, Leon Walras, Vilfredo Pareto, Gregory Clark, Alfred Marshall, Knut Wicksell, etc. Secondly, in Kondratieff's view, some other economists' research was oriented mostly at the study of economic dynamics. These economists state that the equilibrium moment is not the basic one; they may even consider it as random, whereas, according to them, the economic dynamics goes through a whole range of regular development phases. Among those economists Kondratieff mentions Karl Marx, Clement Juglar, Mikhail Tugan-Baranovsky, Arthur Spiethoff, Jean Lescure, Albert Aftalion, and George Mitchell. He indicates, however, that these researchers elaborated on particular problems of economic dynamics, their work standing somewhat apart from general development of economic theory. Nevertheless, it should be added here that namely these researchers made an especially important contribution to the development of the economic cycle theory. As regards the above-mentioned division, it should be noted that, in the view of some economists, the essence of Keynesian revolution is in Keynes' ideas (1936) destroying the belief in perfect inner regulatory forces of the market mechanism (Adam Smith's invisible hand), which meant the true end of the laissez-faire doctrine (see, e.g., Blaug 1985). Discussions between the Keynesians and Neoclassicists are focused mainly on the question whether economy possesses self-
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regulating forces.9 Classical theory pays particular attention to longterm economic growth, dwarfing the meaning of economic cycles. The Keynesians insist that crisis-less economy growth is only possible in the presence of adequate monetary and fiscal policies playing the role of countercyclical stabilizer. In other words, the Keynesians maintain that economic growth directly depends on the state's economic policy, without which such growth may not occur altogether. As Samuelson and Nordhaus note (Samuelson, Nordhaus 2009a: 486487), in the Keynesians' opinion, the economy is prone to lengthy periods of recurring unemployment followed by speculation and inflation growth. While for a classical economist the economy is similar to a person leading a healthy lifestyle, for a Keynesian, economy is a manic-depressive personality periodically inclined either to boundless rage and groundless gaiety, or to hopeless sullenness. Since the 1950s, but especially in the 19701990s, the discussions concerning cyclicity problems were connected with choosing the parameters through which economists proposed to influence it in order to diminish the negative consequences of uneven economic development. Expansion and development of the Keynesian theory contributed to the advancement of the idea about the economy's immanent proneness to falls and booms (i.e., to cycles). However, on the other hand, the popularity of the idea about the possibility of influencing cycles through state policy led to the economic thought focusing mainly on influence instruments. The problems of the cycles' nature and their deep causes gradually shifted to the periphery of the economic science. Best-known in modern economic thought are the Keynesian (more exactly, neo-Keynesian) and monetary schools. The first after-war decades showed that the state policy of influencing economic parameters (such as aggregate demand, aggregate supply, discount rates etc.) is not entirely successful. First of all, it is not always effective; secondly, it is not always based on long-term economic interests; thirdly, it has a certain lag, as necessary laws and decisions must be subject to a long procedure of coordination, approval, and enforcement. This led to growing popularity of the monetarist theory, which suggests that the state should
9
In classical economic theory, self-regulating forces are stated to be the ones connected with the behaviour of economic agents: entrepreneurs, workers, buyers, sellers etc., stipulated by elasticity of salaries and prices, which are capable of supporting the economy in a state of full employment.
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exercise less direct influence on economy, while its interference must be more subtle and concentrate mainly on regulating money supply, money circulation velocity, state debt volume, and interest rates.10 An important contribution of this school to the macroeconomic theory is in the development of the idea about the necessity of following the stable rules of money circulation and not relying on voluntary fiscal and monetary policy. Thus, the main difference between the views of the Keynesians and monetarists lies in their approaches to defining aggregate demand. The Keynesians suggest that aggregate demand changes are influenced by numerous factors, while monetarists believe the main factor having impact on output and prices to be the change of money supply. Monetarists believe that the private sector is stable, and state interference often simply takes resources from it; macroeconomic fluctuations appear mainly because of fluctuations of money supply. In general, one can observe different views as regards the questions of the instruments that should be used to influence the cyclicity, and what should be the role and economic policy of a state in short-term and long-term perspectives. However, some more radical views on direct state interference into the economy are also present within the neoclassical theory. One of its tenets is based on the so-called theory of rational expectations (Robert Emerson Lukas and others), which essentially suggests that, as people use all available information, they can figure out in advance the predictable state policy and use it for their own benefit, as a result of which state policy turns out ineffective. Roughly speaking, no government can outwit the taxpayers. Neoclassicists also assume price and salary flexibility (that is why the theory is called neoclassical, as, similar to the classical pre-Keynesian one, it is based on the idea of economy selfregulation). Like monetarists, they suppose that state influence should concentrate mainly on indirect economy regulation via various monetary instruments.
10
It is no coincidence that dominating positions in global economic science (and practice) went from the Keynesians to monetarists in the early 1970s at a transition period from upswing to a downswing phase of the IVth Kondratieff cycle. On the other hand, such position transition was stipulated by refusal from attachment to the gold standard in dollar, which led to great changes in behaviour of finances devoid of such an anchor.
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However, it is important to understand that in the last 1015 years the process of definite and substantial synthesis of old and new economic theories has been going on (see Samuelson, Nordhaus 2009a: 505507 for more detail).11 In particular, economists started paying more attention to expectations, as neoclassical theory suggests. 2. GENERAL SYSTEMIC MODEL OF CRISIS Thus, there currently exist numerous theories of medium-term economic cycles. However, despite this diversity, we can generally agree with Haberler (1964) in his statement that there is evident multiplicity of causes of recurrence of economic cycles (and, accordingly, their crisis phases). The theories meanwhile differ mostly in the value put upon the same factors (this is especially true for modern theories), so the real differences in opinions were often overestimated. However, the differences do exist and are rather essential. It is appropriate here to recollect Pitirim Sorokin's saying on an equally great difference in views on factors (driving forces) of history. His conclusion is also rather just with respect to approaches to theories on the causes of economic cycles: the number of factor theories is very great, and namely this fact leads one to the conclusion that each sociologist is biased and not completely right. However, each of those theories has been elaborated and tested so thoroughly that one could hardly deny that each of those theories is partly right (Sorokin 1992: 522). That is why it appears reasonable to try to find some more general causes in order to understand the way the crises develop. Those causes might be linked with the point that the general foundations of economic crises are connected with the peculiarities of the capitalist industrial production (which, by definition, must expand). On the one hand, the very stability of modern society depends on the presence of economic growth. On the other hand, the constant economic growth implies (and this point is less frequently taken into account) that the social system must also constantly change. Yet, the economy usually develops more rapidly than the other subsystems (see Grinin 2003a, 2007f, 2007k for more detail), which tend to lead to deformations, tensions, and crises. Thus, the very motor securing the development of modern societies implies the recurrence of
11
The actual synthesis of the Keynesian and monetary theories started much earlier.
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crises. In this sense, it may be said that the crises are immanent for the industrial economy. Such a situation became systemic after a partial completion of the industrial revolution (that is, starting with the 1820s in Britain, and later in other industrializing countries). In Gellner's (1983) words, the production forces started feeling a great insatiable thirst for the economic growth. It seems relevant to note that this was a rather novel historical situation, when the very reproduction of the social system implied constant economic growth; on the other hand, it had to adapt constantly to this growth, to restructure itself in accordance to it, to change constantly. That is, it becomes necessary to take into account the point that growth and expansion are not automatic processes; they must be constantly sustained, whereas without adequate efforts the growth slows down/stops. Yet, constant expansion cannot proceed endlessly, it tends to encounter obstacles and patent/latent resistance (objective unpreparedness/inability) of various institutions, social groups etc.; and in order to overcome those obstacles one has to change respective social institutions. Social actors must also make substantial efforts to overcome those obstacles.12 On the other hand, as we have already mentioned, crises can be usually regarded as results of active growth; as such, growth inevitably creates structural tensions not only in the economy, but within the social system as a whole (because the social institutions fit certain scales and volumes of phenomena and processes). This is proved by the point that the amplitude of a crisis correlates positively with the strength of a preceding economic upswing (cf., e.g., the Great Depression or the 1873 crisis). If the growth was unpronounced, the crisis will manifest itself as stagnation rather than a pronounced downswing, or the downswing
12
For example, if there is a powerful network of corrupt officials, then entrepreneurs' opportunities for production expanding encounter the obstacle of corruption and dishonest rivalry. What has been said about the importance of the whole society striving to provide opportunities for production growth is also important for understanding contemporary phenomena in some Western countries, where a range of factors appeared to be absent, which are necessary for this (in particular, the need for full guarantees does not contribute to growth at all, as it extinguishes activity and energy; the same can be said about the unwillingness to give up anything for the sake of growth). For example, the aspirations of the French government to review currently groundless benefits for various officials (in particular, railway transport employees) have more than once stumbled on desperate counteraction.
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phase of an economic cycle could be hardly visible. According to our calculations with respect to many economic cycles, the output (and, hence, the size) of many economies (or at least their industrial sector) could grow 1.52.5 times within 710 years. Moreover, sometimes key industries could increase 57 and even more times within 10 years. This, of course, could lead to significant disproportions in economy and society. This also specifies rather well the distinction between the economic crisis and circulation crisis (notwithstanding the presence of some common features): the former is always a crisis caused by a real growth (and thus connected with structural problems), whereas the latter does not touch upon the general structure of a social system (and sometimes it could be rather superfluous). Constant and even movement to increase and expansion is impossible, as sooner or later it leads to the occurrence of great disproportions, various system elements starting to aim at coming back to their previous state. The result of this is the occurrence of some type of crisis, economic crises being among the most important types. Indeed, if in the course of 710 years of rapid economic growth the economy increased 1.52 times, this can hardly be regarded as painless for social structure. Even if, for example, there exist substantial resources of, say, labor force in villages in order to support industrialization in the city, rapid urbanization will invariably generate acute problems that can lead to social explosions and revolutions (on the connection between urbanization and bloody political upheavals see: Grinin, Korotayev 2009f; Grinin 2011d; Korotayev, Bogevolnov, Grinin, Zinkina, and Kobzeva 2010). Thus, we can conclude that economic crises are always a system phenomenon, a break of system proportions due to one or several system elements having rushed too far forward (see, e.g., Grinin, Korotayev 2010a; Grinin, Korotayev, Malkov 2010a; Grinin, Malkov, Korotayev 2009, 2010). These are manifestations of a situation when social efforts do not suffice to continue economic growth, as at some point the forces of an attacking army may no longer suffice to continue the attack. The reasons for a possible breakdown of a military attack can vary, but in general they are usually engendered by lack of resources and forces, wrong direction of the main blow, underestimation of difficulties, overestimation of own capacities etc. In the same way, economic crises occur due to various reasons, but their general reasons
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are resource exhaustion, difficulty underestimation, and capacity overestimation within the existing economy. Just as the army has to regroup, activate reserves and change commanders-in-chief, society and economy have to regroup, substantially change their structure, and find new resources and forces, as well as new people. Thus, economy moves from crisis to crisis, from cycle to cycle, because economic growth does not occur automatically, but requires great efforts and stimulation, which encounter numerous obstacles. In order to continue the move to a higher point, recession appears to be necessary to bring the system to a new equilibrium, along with some rebuilding. Even the most insightful crisis researchers somewhat misunderstand the fact that each given economic cycle is not a repetition of previous cycles, it is an essentially new phenomenon only partly similar to the previous cycles and largely different from them. For example, TuganBaranovsky presents the following interesting comparison:
One may compare the action of this mechanism with a steam engine. The role of the steam is played by the accumulation of the free monetary capitals; when the steam pressure reaches a certain marginal value, the resistance of plunger is overcome, the plunger moves, comes to the end of the cylinder, the steam finds its way out, and the plunger returns to its initial position. In a similar way the free monetary capitals (after they grow to a sufficient size) penetrate into the industry, move it, then those capitals are spent and the system returns to the initial position. Naturally, in such condition crises must repeat periodically. Capitalist industry must constantly go through one and the same development circle (Tugan-Baranovsky 2008 [1913]: 326).
However, plunger movement in a cylinder symbolizes the simplest repetition without qualitative change, while in industrial economy we observe a pronounced expanding (and in no way simple) reproduction. The economic cycle, as we understand it, is altogether not a simple repetition, but essentially only a repetition of some common elements of development combined with structural change, expansion and/or complexity growth. Thus, after each J-cycle territories active in global economic relations expanded, complexity of interactions within the World System increased, its structure altered: the centre expanded or shifted, periphery became semiperiphery, hinterland became periphery etc. (for a systematic analysis of such change from cycle to cycle see Grinin, Korotayev 2010a). The same
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occurred in separate societies, where reforms, revolutions, alliances etc. accompanied every cycle. Taking into account the fact that capitalist large-scale machine production could only take place within a sufficiently developed world system, crises must be regarded as processes that occur within the suprasocietal framework. Therefore, external factors which influence the functioning of society's economic system should not be regarded as something extraneous to the essential model of crisis (as, e.g., Schumpeter [1982] does). On the contrary, external factors always substantially influence the course of crisis. It can be said that it is even often required for the crisis to go on in vividly expressed classical forms. Besides, in some countries the economy's capacity for dynamic development weakens as time passes, along with capacity to innovate. That is why sometimes the World System centre is replaced by one of the leading rival centres. Dynamism leaves the economy of these countries (as it happened at some point in England, Germany, Japan and seems to be happening now in the USA). Let us now investigate how the general systemic model of crisis occurrence can be represented on the basis of what has been said (see Fig. 4). Thus, after a depression phase, there finally begins a recovery phase (for the description and sequence of cycle phases see below). Let us suggest that, normally, development during the recovery phase should not proceed further than the highest point of the previous cycle. It is during the upswing phase, after the economy has received additional impulses for development, that growth can exceed the highest development point of the previous cycle. The question is: how far can the economy develop? In principle, the growth should go up to a conditional point that is optimal for this system. It is a point which a) is situated higher that the highest one in the previous cycle, as due to innovations and counter-crisis measures the economy's level has risen, b) its achievement does not threaten the system with collapse. However, the development does not usually go the optimal way. Quite often, the upswing continues, going beyond the limits of the point of normal economy growth. This occurs because of the production cycle being lengthy in time; substantial time lags exist connected with the time of new capacities' introduction, getting feedback from innovations, etc. Time is necessary for negative trends to express themselves; more time is
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necessary for them to be perceived by market participants etc. As a result, even if the entrepreneurs aspired to such growth optimization (while in reality they aspire to maximizing this growth), the optimal (i.e. crisis-less) development point would be very likely to get missed. The more actively the growth goes on, the wider the credit expansion is; the more energetically participants of an upswing trend act, the further this point will be missed. Thus, crisis and fall appear to be unavoidable, as the development in the upswing phase jumps over the point of optimal growth. This point, meanwhile, should be regarded as a temporary attractor to which economy aspires to return in normal conditions. In the meantime, the further the jump is over the attractor, the more painful is the decrease afterwards. In its turn, according to the pendulum law, downswing movement now not only achieves this attractor, but slips down over it (see Fig. 4). The system eventually achieves equilibrium only when the depression phase finishes and the recovery phase starts. Fig. 4 shows that ) optimal points of both upswing and downswing lie approximately on one line; b) the point of lowest downswing is usually situated higher than the upswing starting point (= the highest point of recovery); this shows that due to such fluctuations we still observe an overall forward movement of economy.
the highest upswing point
the optimal upswing point

the highest upswing point of the previous cycle the highest recovery point of the previous cycle the recovery starting point
the optimal downswing point
the lowest downswing point
Fig. 4. Scheme of crisis occurrence within economic development cycle
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3. ON SOME IMPORTANT SPECIFIC FEATURES OF CYCLICAL ECONOMIC CRISES It should be evident already that all crises vary but still possess substantial common features. These features of cyclicity will be viewed below in more detail. At the same time, some important characteristics of economic cycles ending in crisis are paid insufficient attention (or none at all) by numerous researchers in their theoretical constructions. In our opinion, this does not always give the possibility of understanding the situation adequately. Therefore, we suppose it is reasonable to indicate the following points. Economic crises and financial sector. Crises occur most often and in a most acute (panic) form in the financial-credit sector (including the stock exchange). It is no coincidence. Economy consists of numerous branches and spheres; in each of them things may go on differently. However, common upswing and common difficulties (or, at least, difficulties concerning a whole range of branches) invariably display themselves in universal equivalents, such as money, bonds, gold etc., as well as in general price index. That is why both increasing and falling demands for resources in the major part of economy are expressed in financial market strain, price increases, or vice versa in the decrease of rates, indices and prices, which is evidently expressed in general euphoria in stock exchanges, credit market, etc., or, on the contrary, in panic and escape from financial instruments. Thus, almost all cyclical crises are connected with disorder (or even fall and collapse) of monetary (gold and exchange currency) circulation, stock prices of shares and other securities (bonds, bills of credit, etc.), with various speculations (including those with shares, raw materials, real estate, lands rich in minerals, etc.).13 Thus, it is exceedingly important to understand that practically no purely economic (in the meaning of purely industrial) crises exist, and possibly cannot exist at all. Economic crises are always connected with
13
This gives grounds for some analytic researchers to state that all financial crises starting from the 17th-century famous tulip fever in Holland developed according to one and the same scheme (see, e.g. Minsky 1983, 1985, 1986, 2005). This conclusion being essentially true (from the psychological aspect as well) is still a great simplification as each financial (and still more economic) crisis is produced by a combination of factors (see Haberler 1964). What is more, every crisis is produced by its own specific combination of factors, which always makes it different from others.
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crises in the circulation sphere of numerous, and sometimes all, branches of economy: banking and crediting, gold and foreign currency, stock exchange, foreign commerce, wholesale trade and retail, capital movement sphere, securities emission, the sphere of speculation in various values including real estate. In some cases these spheres are leading as regards the main crisis vector; in other cases this role is played by processes going on in light or heavy industry, construction, and transport (where excessive inventories are created, volumes of production and long-term investments, excessive debts on credits etc.). The balance of such responsibility for crisis in each particular case (and in each particular country even during one global crisis) may be greatly different. Crises in circulation sphere connected with disorders in the sphere of finance, funds, stock exchange, trade operations can precede industrial (economic) ones, happen simultaneously with them, or occur later. In this case, circulation crises usually have a depressive impact on the economy as a whole. Thus, downswing in different economy sectors and circulation crisis act as interrelated expressions of recession and depression phases in an economic cycle. However, non-cyclical crises occurring in the spheres of banking, foreign currency exchange, stock exchange, specific branches of trade, speculations, and other institutes which do not concern national economy and economy as a whole to the same extent as cyclical ones do, are rather frequent. Non-cyclical circulation crises bear a comparatively narrow or special character. In other words, such crises can be strong and acute, not being a part of cyclical economic crises. Such crises may not influence the cycle course altogether; for example, they may not interrupt the upswing phase. The very tight connection between circulation and industry becomes even more understandable with regard to the importance of inventory sizes for the industrial development, as well as the importance of the commodity transportation costs, fluctuations of demand for industrial goods, costs of rent and various relevant services, this all being most intricately interwoven with credit, currency, and other spheres. If a disorder or sharp drop occurs in some part of this complex mechanism, it starts working in a completely different way from what is expected by its participants. For example, if speculators hope that prices of raw materials, fuels or other resources will rise, and if (because of
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that) they start buying up these resources in order to increase their scarcity and, thus, to raise their prices artificially, while prices, contrary to their expectations, stop growing, this can lead first to an excessive supply of those resources (as one has to return funds), the decline of their prices, bankruptcy of some speculators and the respective banks, and further to a general bust (as a result of which many other economic actors will suffer, including industrialists, investors, traders, banks that have supplied them with credits, etc.). There are also some other spheres where industrial and financial interests are tightly intertwined, like the establishment of new firms and joint stock companies (that accumulate capital of a large number of financial institutions and private persons), housing construction, real estate operations, etc. External factors. They have been already discussed above, but some things are to be added and summarized. Almost every cycle and cyclical crisis possess, so to say, some external expansion, i.e. they are never secluded into the framework of one single country, but always rely on such an important element as external economic relations, while the economies of a whole range of countries cannot develop without outward economic orientation. In other words, we suppose that without an external economic component many crises just cannot occur (even if, first of all, they have internal causes and bases). On the other hand, without this component a pronounced upswing phase often cannot occur as well, because economy has no space for development in the environment limited by national frames. In practice, cycle evolution and crisis always involve external trade. Cyclical dynamics (rise and subsequent fall) are connected to capital import/export, to rivalry for markets with other countries, whereas crises are amplified as a result of disturbances of monetary, trade balances, or as a result of fluctuations of imports of important resources, etc. Thus, in the 19th century the British cotton industry (that at a certain level of analysis can be regarded, of course, as a purely British internal phenomenon) originated and developed as an industry that worked for the world market as it exported from 2/3 to 4/5 of all the produced textiles (see, e.g., Mendelson 19591964, vol. 1: 143144; Trakhtenberg 1963: 114). That is why the expansion (or contraction) of the external markets was bound to affect the British industry in the most significant way. On the other hand, it depended on the imports of cotton; thus, any disruptions in these supplies led to crisis phenomena.
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The factory owners of Lancashire got to know about disturbances in their own homes from the news on the disruptions of trade, decline of prices, and bankruptcies in countries that were separated from England by hundreds and thousands of kilometers, by seas and oceans (Mendelson 19591964, vol. 1: 143144). For three quarters of a century the main branch of the British industry was represented by the cotton processing, and up to the mid19th century the British crises were first of all crises of the cotton industry. Yet, even when the heavy industries became the main branch of the British economy, its dependence on exports did not decrease, as Britain exported most of its heavy industry products. For example, in 1850 Britain exported almost 45 % of the pig iron produced in this country (Ibid.). Simultaneously with this, one could observe the growth of export of capital from Britain (to a lesser extent from other countries), which, incidentally, affected the proceeding of its own internal cycle. (Tugan-Baranovsky [2008/1913] paid special attention to this aspect of England's economic life.) Limitations on directions of superprofitable capital application. As within an economy during the period of its relatively not fast development large amounts of capitals are stored (and their owners usually get thereupon only modest profits), numerous capital owners would commonly like to substantially increase the profitability of their capitals. This creates a situation which we have named the scarcity of especially profitable capital investment directions (such a scarcity is exacerbated by credit expansion [Grinin, Korotayev 2010a]). Given a high demand for a profitable investment, from time to time such directions appear. Such directions can appear, for example, as a result of the development of new industrial or transportation technologies. However, such directions can also appear as a result of creation of new financial, trade etc. technologies, and this fact goes almost completely unnoticed. In our opinion, almost every crisis is preceded by important changes in these technologies, their powerful expansion or development of essentially new technologies. This is a point of crucial importance, but for some reason this regularity has been almost completely ignored. In our monograph (Ibid.) we try to show which changes in financial technologies appeared in each new J-cycle. This is still more important in view
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of the fact that contemporary crisis is closely connected with new financial technologies. It should also be noted that many financial innovations are directly connected to technological ones (on this close connection see Gille 1976); for example, the widespread introduction of telegraph and telephone communications radically changed the work of stock exchanges, dramatically increasing their importance, working speed, volumes of people involved etc. This fact, however, has been given next to no attention (see, e.g., Doronin 2003: 103; Held et al. 1999: 192).14 Social changes connected with the crisis. As follows from what has been said above, for a new cyclical upswing to start after bust and depression, substantial changes in society are necessary, not only in the economy, but also in social, legal, political, and other relations. Sometimes such changes occur spontaneously (this can be connected with demographic processes, e.g., migration to cities, with social processes, such as peasants and craftsmen becoming hired workers etc., with the creation of new industry types and so on). Economic growth always means that some groups grow richer, while some grow poorer (usually relatively, but sometimes absolutely). These poorer groups can include some former representatives of higher (aristocratic) classes, which may generate elite conflicts. However, such changes sooner or later cause adjustments in legal, political, and ideological subsystems. If such adjustments do not take place, revolutions and disturbances can occur. On the other hand, after crises states tend to change legislation in order to prevent new crises (or decrease their magnitude). Such legal changes are not always successful, but effective decisions are usually found only by trial and error. However, in one way or another, without essential (including structural) changes in the society, a new economic cycle can turn out to be weak. This partly accounts for the point that in old industrial societies economic cycles and crises are manifested in a less pronounced way, whereas their magnitude increases in other societies. This could take place particularly in case of movement of centres of the World System's economic processes, as happened with the transition of the world economy's centre from Britain to the USA in the first decades of the 20th century.
14
On the other hand, it appears appropriate to mention the important role of the development of technologies of consumption and marketing (see, e.g., Lancaster 1993).
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The crisis definition. As the notion of economic (cyclical) crisis has no universally accepted understanding, it appears necessary to mention that within this chapter we denote as economic (cyclical) crisis the whole period of recession and a part of the depression period (that can have even more serious consequences than the recession itself). Thus, we consider the cyclical crisis as a substantial part of the economic cycle, within which the potential for growth becomes temporarily exhausted and a compulsory re-establishment of proportions takes place; those proportions are more appropriate for the extant potential of social system. We consider it as a part of cycle, within which socio-structural contradictions and incongruences become unsurpassable for a certain period of time, whereas later they are solved creating a potential for a new cycle. Hence, the acute crisis sub-phase can be regarded as a part (albeit the most dramatic) of the overall cyclical crisis period. It should be taken into consideration that within the real economic process one could observe different trends and cycles with different periods. Within an economic cycle various modifications occur, intermediate crises and recessions develop; in addition, the timings of cycles in different countries may differ significantly, etc. That is why it is not always easy to identify boundaries of J-cycles. In particular, the first crises of the 19th century were more evident in Britain (as the most developed industrial country) than in other countries that followed in the fairway of Britain. On the other hand, in the late 19th and early 20th centuries economic cycles (and especially cyclical crises) became less evident in Britain than in Germany or the USA. 4. A VERBAL MODEL OF THE J-CYCLE Our model takes into account a number of approaches to the analysis of such cycles that are specified in the publications by Juglar (1862, 1889); Lescure (1907); Marx (1961 [1893, 1894]); Tugan-Baranovsky (1954; 2008 [1913]); Hilferding (1981 [1910]); Mitchell (1927), Keynes (1936); Varga (1937); Haberler (1964 [1937]); Mendelson (19591964); Minsky (1983, 1985, 1986, 2005); Hicks (1946 [1939]; 1993: 432442); Samuelson and Nordhaus (2005: 403552); Schumpeter (1939); von Hayek (1931, 1933); von Mises (1981 [1912],
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2005); Cassel (1925); Pigou (1929); Friedman (2002); Abel and Bernanke (2008), as well as a number of other economists. In the meantime this model also takes into account some of our own generalizations and additions that we believe are important for understanding the internal logic of the cycle, its variability and its peculiarities in the present-time conditions. On the peculiarities of the current cycle see in particular Grinin 2008c, 2009a, 2009e, 2009g; Grinin, Korotayev 2010; Grinin, Malkov, Korotayev 2009; Grinin, Korotayev, Tsirel 2011). However, it will be important to take into consideration that in the model there can be shown only the more common and by definition idealizing characteristics. There was no economic cycle that completely coincided with any cycle model. Such congruity is impossible in principle. Below some diagrams demonstrate how different could be every cycle.
6 years 4 years
9 years
Fig. 5. The medium-term cycle of 18731882. The index of durable manufacturing production (1899 = 100) Source: Edwin Frickey, Production in the United States, 18601914 (in Hansen 1951).
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Boom of World War II period
Fig. 6. The boom of World War II period. The index of durable and nondurable manufacturing production (19351939 = 100) Source: Federal Reserve Board, Index of Total Manufactures (in Hansen 1951).
7 years
6,5 years
11 years
Fig. 7. The medium-term cycle of 1865/61873. The index of durable manufacturing production (1899 = 100) Source: Production in the United States, 18601914 (in Hansen 1951).
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7 years
5,5 years
11 years
Fig. 8. The medium-term cycle of 18821892/5. The index of durable manufacturing production (1899 = 100). Source: Production in the United States, 18601914 (in Hansen 1951).
8 years 8 years
11 years
Fig. 9. The medium-term cycle of 19211933. The index of durable manufacturing production (19351939 = 100) Source: Federal Reserve Board, Index of Production of Durable Manufactures (in Hansen 1951).
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Our model of business cycle is based on its subdivision into four phases (according to the point of view that is quite widespread but not universally accepted [see, e.g., Haberler 2008: 220]): recovery phase (which we could sub-divide into the start subphase and the acceleration sub-phase); upswing/prosperity/expansion phase (which we sub-divide into the growth sub-phase and the boom/overheating sub-phase); recession phase (within which we single out the crash/bust/acute crisis sub-phase and the downswing sub-phase); depression/stagnation phase (which we could subdivide into the stabilization sub-phase and the breakthrough sub-phase). It is possible to start the analysis from any phase; we have decided to start it with the recovery one. 5. RECOVERY PHASE This phase starts after (and as a result of) the liquidation of disproportions (and the establishment of new proportions) that almost inevitably takes place during the preceding phases of recession and stagnation (which often lead to a significant restructuration). That is why a new cycle starts at a new level of equilibrium (Schumpeter 1939). The recovery and certain growth can start because, as a result of the preceding downswing, excessive commodity inventories have been dissolved and have come into correspondence with extant demand, some unsatisfied demand for commodities has been formed, problematic firms have disappeared, bad debts and fictive capitals have been burnt out, businessmen have become much more cautious (see, e.g., Minsky 1983, 1985, 1986, 2005), etc. As we have already mentioned above, some psychological factors (in particular, businessmen's expectations, panics, sharp transitions from excessive hopes to fears of collapse) play a very important role in the changes of business cycle phases (see, e.g., Mills 1868; Minsky 1983, 1985, 1986, 2005; for the analysis of such theories see Haberler 2008: 125131; Grinin 2009g). Note that the growth of such expectation (e.g., that the prices will continue to grow or fall) and economic dynamics frequently form positive feedback loops. For example, the growth of prices against the background of the expectations that the prices will continue to grow may lead for some time to continuation of the upward trend
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notwithstanding any objective factors. On the other hand, the fall of prices against the background of expectations that the prices will continue to fall may lead to the fall of prices far below the level dictated by any objective factors. Psychological factors are exceptionally important in speculations that play an immense role in the business cycle dynamics. In particular, the fall does not occur against the will and senses of a large number of businessmen if they believe that situation is good for growth. That is why panics and temporary crises frequently pass away fast in conditions that are favorable for growth; whereas when disturbing trends have been formed in the real economy, even some apparently ordinary events (like a bankruptcy of a corporation, or a bank) can serve as a trigger for mass panics, bankruptcies, and the start of a general crisis.15 Hence, the psychological factor (factor of expectations, moods of the mass of businessmen and general population) is not only an important factor, it is also the most dynamic and labile factor that can serve as a trigger.16 This appears in the most salient way in stock exchanges, with currency fluctuations, etc. The growth that begins during the recovery phase is determined by the following changes that took place during the preceding phases of recession and depression: a) formation of large stocks of various unexploited resources (capitals, labor, machinery) and some increase in demand for various commodities and services (see, e.g., Tugan-Baranovsky 2008 [1913]; Mendelson 19591964, vol. 1); b) formation of confidence among businessmen/investors that the situation is improving (Ibid.; see also Varga 1974); c) liquidation of various obstacles in the course of preceding recession/depression;17
15
The psychological factor is equally important for the understanding of the crises' causes as it is for the understanding of the causes of military victories and defeats, or, which might be more obvious, the causes of revolutions. Whatever objective causes for revolutions could exist, the revolution will not occur until there appears a certain mood in the society to overthrow the government (blame it for everything, disbelieve it in everything). However, on the other hand, the stronger such a mood, the more banal can be the particular pretext for the start of disorders. 16 That is why much importance is attributed in economic science to such indicators as various business expectations indices. 17 Amazing as it may be, this circumstance is not often taken into consideration.
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d) establishment of new stimuli (through, e.g., tax reductions, decrease of interest rates, etc.); e) invention/diffusion of new technologies, commodities, and services during the preceding recession/depression phases (see, e.g., Marx 1961 [1893 1894]; Schumpeter 1982); f) re-equipment of enterprises, re-start of exploitation of assets that were not exploited during recession. Note. The transition from the depression to the recovery phase can take place quite spontaneously, but in this case it may take quite a long time for a recovery to begin. That is why such a transition usually needs a certain impetus that can be manifested in some favorable external or internal conditions, in some special stimulation (major construction works, discovery of new resources, breakthroughs in particular economic sectors, etc.). In the years of Great Depression in the USA a theory of pump-priming was rather popular. According to this theory, a pump should be primed with water in order that it could start working automatically; the economy should be also primed in order that it could start growing automatically (see Lan 1976 for more detail). This image is rather appropriate for understanding the economic recovery mechanism. A positive impetus produced under objective conditions favouring the start of recovery begins to form positive expectations. This triggers positive feedback loops when the increase in demand stimulates the economic growth, whereas the economic growth stimulates the further increase in demand and the reduction of unemployment that further stimulated the increase in demand, and so on (for more detail see below the description of the upswing phase). In general, various starters are necessary in order that a steady economic expansion could begin (see, e.g., Haberler 2008: 245). The way the recovery phase proceeds depends on the depth of the restructuration of the economy and society (see below), as well as on various circumstances that play roles of stimuli or obstacles (on stimulating factors see, e.g., Tugan-Baranovsky 2008 [1913]: 92). Sometimes the recovery phase does not grow into a phase of steady growth; instead a new crisis starts. This indicates that the restructuration was insufficient (or that within the given social system capitals and other resources moved to more profitable zones/countries and that this system lacks sufficient resources for the start of a new breakthrough [one could mention
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here as examples the 1882 crisis in Britain, or the 1937 crisis in the USA]). We believe that, for the recovery phase to be able to grow into the phase of steady growth, purely technological innovations are insufficient; they should be accompanied by a significant restructuration of the social system (naturally, including its economic subsystem). Long-term investments start the recovery phase; they play an especially important role at the upswing phase when they stimulate the demand and create a time lag that amplifies the disproportions of demand and supply. 6. UPSWING PHASE The conditions and mechanisms of sustained growth Before the start of our description of the upswing phase, we find it appropriate to specify schematically some mechanisms (positive feedback loops) that usually contribute to the economic growth at this phase; they are also relevant to the start of the economic growth at the preceding recovery phase. 1. It is evident that the growth of demand leads to the growth of supply that, in its turn, leads to the increase in demand. 2. The growth of production leads to the decrease of unemployment, which leads to additional growth of production/supply, this resulting in an additional decrease of unemployment, and so on. 3. The expansion of production leads to the increase in positive expectations, which in its turn results in the growth of long-term investments, whereas this contributes to the production growth, and so on.18 4. The growth of production leads to the growth of expectations that it will grow more and more, and, hence, that the demand will grow more and more, which results in growth of the credit supply (including credits for consumers); this stimulates the demand and results in the acceleration of economic growth; and so on. 5. The growth in production of consumer commodities leads to an even more conspicuous growth in production of the means of production; this stimulates the growth of production of consumer commodities (including ones produced to satisfy demands of the expanding sector producing the capital goods), and so on.
18
It is important to take into account the fact that, along with other things, this leads to a lengthening of the upswing period.
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It appears necessary to mention that during recession all processes go in a very similar way, but with the opposite trend. For an economic system to be able to experience a significant upswing (let alone its reaching the highest overheating sub-phase19), a number of conditions should be satisfied. Firstly, for a certain period of time there should be a certain surplus of resources (e.g., capitals, according to theories of Tugan-Baranovsky 2008 [1913] and Marx 1961 [18931894]); technological innovations, according to Schumpeter (1939), labour force, territories rich in mineral resources etc., without which a take-off turns out to be impossible. Later on the movement can be supported by other means (including special stimulation of demand).20 Secondly, there should be wide opportunities for an effort application. For example, as a result of preceding changes one could observe the decrease of prices for commodities produced by advanced sectors (e.g., in the 19th century this could be certain textiles, whereas in the late 20th century these were computers21), as wide masses of people start buying them. In other words, the market expands dramatically, and at first it could seem limitless. Limits are perceived empirically, that is why supply expansion frequently goes far beyond the limits of the new market. This simultaneously creates a powerful impulse to the development and leads to the creation of disproportions in resource accumulation. Frequently, hopes for greater market expansion or profitable investments suffice for the capital to flow disproportionally in a particular direction (e.g., investing into some seemingly very perspective shares).22 This can also be a simple speculation, but for the phase of upswing it is extremely important that real development stands behind it,
19
The overheating (boom) sub-phase may be conventionally demarcated by the moment when the output exceeds the highest point achieved during the previous business cycle (see Fig. 4). For more detail see Grinin, Korotayev, Tsirel 2011. 21 Demand expands still more if there occurs a sharp fall in prices for goods the possession of which previously used to substantially increase of the owner's social status. 22 An interesting case occurred in the economy of England in 1842 when, after the first opium war was over and Chinese ports had been opened for trade, the society became confident that China would become an unlimited market for English cloths. New textile factories started being built, while the old ones were being modernized. This contributed to the economic growth, but the hopes for the Chinese market capacity turned out to be greatly exaggerated (Tugan-Baranovsky 1954).
20
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at least partly (taking into account the availability of corresponding means of industrial expansion). In that case substantial economic growth will eventually take place. Thirdly, new people (including innovators) should appear; this is a point emphasized by Schumpeter (1949 [1911]). It seems appropriate to mention that some entrepreneurs either lack the experience of previous crises or have partially forgotten it, so a great number of them gradually lose caution (strongly influencing the others through example and rivalry). This is one of the reasons for excessive expansion at the overheating sub-phase. Fourthly, an upswing trend should appear with respect to the growth of demand, investments, as well as prices (especially with respect to some particularly sensitive commodities and resources [Hicks 1993: 433]), which creates a powerful driving force and development inertia. Juglar was one of the first economists to indicate the growth of prices as a cycle characteristic (Juglar 1889); in general, the issues regarding the price increases or decreases were always in the centre of analysis of both theoreticians and historians of cycles. For example, Tugan-Baranovsky (1954) maintains that the level of commodity prices serves as the best barometer of the economic situation of a country.23 Yet, it appears important to note that the increased demand for various resources and commodities (developing at this phase) not only leads to rapid price growth, but also could lead to the situation when economic system turns out to be unable to cover the increased demand for many resources and commodities (e.g., some complex equipment, real estate objects, raw materials, etc.). This is accounted for (in addition to the fact that many resources are naturally limited, or need a considerable time to be produced, e.g., agricultural products), firstly, by the point that demand growth can be sometimes explosive, the buyers want to get the commodities as soon as possible, while in order to sat23
However, in modern conditions in view of inflation activities of governments and other conditions, a price increase does not always indicate economic health. Situations when output declines were accompanied not by price decrease (deflation), but by price increase (inflation) were observable in the USA in the course of some after-war crises (see Grinin, Korotayev 2010a: ch. 2 for more detail), but this unusual combination was particularly visible during the 19741975 crisis. The situation of output fall combined with price increase was called stagflation. Its strong manifestation was largely accounted for by sharp increase in oil prices, while possibilities for their falling were handicapped by cartel agreements amongst the OPEC countries.
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isfy the rapidly increasing volume of demand some definite, sometimes lengthy, time period is necessary technologically and organizationally. Secondly, such discrepancy of expectations creates additional boom demand, a certain resource scarcity, which is sometimes increasing, and prices for these resources go up. In this case, speculators step in, aiming at buying off the products in order to resell them. The buyers increase ordered commodity volume in order to create necessary stock for the case of supply failures. Thus, the situation is created which we call supply scarcity situation (for details see further). It plays a very important role in accelerating the processes of rapid price increase. The latter makes production exceedingly profitable, increasing manufacturers' aspirations to expand production and supply (through massive investments as well), which additionally stimulates demand for resources and economic growth. The growth itself causes additional supply scarcity (as supply is invariably late), etc. Thus, a positive feedback spiral unwinds fast, creating economy overheating. Even greater boom demand and supply scarcity occur in the sphere of free speculative capital application, which will be described below. 7. OVERHEATING SUB-PHASE It should be noted that in the course of the recovery phase and the beginning of upswing, temporary relative equilibrium of the depression phase is distorted (without which growth is naturally impossible). Equilibrium distortion increases as a result of the fact that entrepreneurs, having run out of free capital (gathered during crisis and depression) for their business and having employed all the free capacities, start investing more and more loan money. Akaev and Sadovnichiy (2009) emphasize that the change of equilibrium level (as in Schumpeter's [1939] theory) defines the long-term trajectory of economic development, in the course of which economic system is in a dynamic equilibrium. However, we assume that such a dynamic equilibrium starts being distorted as early as during the upswing phase, especially at transition to the boom (overheating) sub-phase. Thus, obvious structure-price distortion develops, which is usually connected with various bubbles (related to prices, investment, stock exchange, currency, etc.). In our opinion, distortion must invariably create
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some bubbles, e.g., through excessive speculative prices of raw materials or fuels, real estate, some financial instruments or gold. However, the distortion itself (i.e., structure-price disproportion) can arise only if a certain source of demand growth appears. In most cases, credit expansion serves as such a source for demand growth, as this expansion this point is often left out of attention is in itself a form of banking and financial sector growth.24 An exceedingly important role is also played by different forms of free cash accumulation in various joint-stock companies, financial and pension funds, insurance companies, etc. (on modern financial technologies see Grinin 2009, 2009e; Grinin and Korotayev 2010a, 2010b). All this is greatly spurred by founders' fever, speculative boom and other phenomena, due to which economic expansion usually proceeds at the overheating sub-phase. Government efforts to stimulate demand (as well as various random conditions) are frequently added to those. Gigantic financial assets (accumulated in some way and most importantly emitted, dubbed in second, third etc. degree due to various complex financial technologies, e.g., derivative instruments) are capable of radically changing the proportions of demand and supply, taking into account the more and more expanding credit. Meanwhile, just as in the price increase period the technologies and resources that are unprofitable in usual time start being used, in the period of increasing demand for financial resources those resources start being used which in usual time seem dangerous, unreliable, or, using the modern term, toxic. At the same time, credit, accumulation, and emission of stocks, as well as financial players' direct coming to a certain market cause both sharp distortion of proportions and radical increase in business activity plus substantial increase in the length of the boom's period.25
24
In modern conditions, when the financial sector of developed countries produces from 25 % to 33 % of GDP (see, e.g., Akaev and Sadovnichiy 2009), it must itself perform such an expansion. In the modern world, the GDP growth cannot occur without it altogether. In our opinion, credit and other financial technologies can be viewed as mechanisms for resource mobilization, without which economic expansion practically cannot exist. It should be noted that, in the modern economy, credit itself becomes an increasingly important and especially rapidly growing form of economic expansion. 25 This, it should be noted, leads to a sooner introduction of new capacities, investments into which were engendered by the upswing.
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Note. It should be noted that within the analysis of business cycles, there is a tendency to separate economic growth and decline from speculations and various bubbles; the latter are often considered as a kind of separate and essentially random part of the process (actually, this is typical not only for Marxists). Meanwhile, in our opinion, speculations, bubbles etc. are constituent components of cycle that are almost always present within it (the same is true for the collapse of those speculations). This is explained by the fact that, in the period of powerful expansion and overheating, difficulties of economy growth and resource mobilization are rather salient. In order for such growth to continue, strong stimuli are necessary. Such stimuli are created namely in the sphere of circulation, speculations and various pyramids. Speculative boom engenders powerful process of asset re-evaluation. The effect of asset re-evaluation at some point involves great masses of people into the process of chasing after profit (i.e., into the process of expansion). Thus, speculations turn out to be a kind of luring lights of movement, expectation measurers. However, if speculations are not put into strict frames, they may lead the economy far on the way to crisis. Consequently, such a process is an organic part of the expansion (overheating) process, and not only a speculative scum (see also our explanations above). Further on, as we shall see below, it is namely in this sphere that a great number of participants is cut out, which creates initial conditions for acute crisis. From what has been mentioned above it follows that, as in the process of rise and overheating there always occurs strong re-evaluation of funds (expressed in the increasing quotes or rising monetary evaluation of symbolic assets), so cyclical crises are organically connected to large-scale collapses of funds, banks etc. (and to some extent must be accompanied by such processes) and generally by monetary crises. In other words, stock market crashes may occur without cyclical crises (e.g., in the form of a simple stock market crash or a foreign currency crisis, which do not lead to economic decline). However, cyclical crises are usually connected with such collapses (stock market crashes, collapsing real estate prices, etc.).26 This approach allows, as we assume, including the increases in
26
The fact that the expansion period before the first global crisis in 1825 was accompanied by some definite clear symptoms is very remarkable, as this showed that the speculation had become part of the expansion phase, without which this phase would either occur at all, or proceed in a substantially different way. By 1825 the economy overheating was accompanied by such typical features as intensive industrial construction, sharp increase in prices and stock prices,
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speculation activities more naturally into the general scheme of overheating, collapse, and crisis (see also about this subject Perez 2003). However, this does imply that it is not necessary to counteract destructive speculations and to put them into certain strict frames on the contrary, this must be definitely done. Thus, measures affecting speculation activities can be a very important factor for changing the character of the cycle and for diminishing crisis's intensity. In the period of general boom and price increase most economic players feel well. However, it is important to take into account the fact that the upswing is accompanied by the formation of some spheres that secure the highest profit levels (their profit norm can be substantially higher than that in other spheres). Namely these spheres are the first responsible for excessive price increase, general assets overestimation, and supply scarcity strengthening. As a result of processes described above, a great amount of capital is created, which tends to be invested first and foremost into the most profitable branches and spheres. If those are industrial or material spheres, the trend to investment in them strengthens. As a result, the situation arises when each new investment project only increases the already sufficiently high struggle for access to labor, materials, financial and other resources. Rivalry among speculative financial resources and capitals is even stronger, as the areas of their super-profitable application are strictly limited, and in the same time they are substantially mobile. That is why world financial resources could get focused here in a rather rapid way. As spheres of especially lucrative application of surplus capitals are rather limited, bubbles are blown particularly fast, namely in the financial sphere. Huge streams of capital to some particular lucrative spheres (e.g., stock exchange dealings on raw material contracts, foreign currency speculations, investments in real estate etc.) are capable of causing extremely rapid price increase (devoid of any real basis) on these assets limited in volume and nomenclature. This situation (when one can observe a scarcity of the most lucrative spheres of investment, as well as excessive growth of demand for many resources and commodities caused by the overheating that leads to the increase in prices and a tendency for supply to lag behind demand due to
wide credit expansion, blooming speculation in all its forms (Mendelson 19591964, vol. 1: 128).
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technological, labor, transportation and similar limitations) was conventionally denoted by us as a situation of supply scarcity. Yet, this is a business activity restricting scarcity. It should not be confused with a direct deficit of mass consumption commodities as observed in socialist countries.27 That is, the notion of scarcity is applied here in a rather peculiar sense. The thing is that, while in private life the problem of lack of some goods can be solved through large overpayments, in commercial affairs this is usually irrational, as in such a case the buyer will not be able to return the funds he spent. That is why the supply scarcity has the following manifestations. Firstly, many businessmen simply abstain from their plans on expanding the manufacture, purchasing something, making investments etc., as they either cannot afford it or the increased price makes their projects unprofitable. We will return to this point later. Secondly, as in business and speculations, actors always struggle between the aspiration to purchase something for the minimum possible price and the time factor, they often prefer waiting, standing in a line, to being overcharged. Besides, in business, especially in large corporations, there exists their internal order, some definite business ethics and inertia which it is not always possible to avoid even with the increased price. As a result, the manufacturers cannot manage the number of orders and form a waiting line or simply refuse some orders because of being overloaded. In this case, buyers frequently have to turn to manufacturers of goods with lower quality, to place their orders in other markets, to be overcharged with transportation costs, etc. Thus, supply scarcity is evidently manifested not only in price growth, but also in physical delay (and sometimes impossibility) of purchasing required resources, goods and assets, etc. Thirdly, an increased (or unsatisfied for a long time) demand for resources (scarcity) is also connected with the fact that production of different economic sectors possesses a greatly varying degree of elasticity, which creates a different degree of its scarcity and, accordingly, a dif27
Even though in the case of overheating there can sometimes arise direct scarcity of some prestigious goods, such as some car brands, household appliances, housing, hotel accommodation, tickets for some types of transport, particular kinds of services etc. In this case the buyers are ready to pay an increasingly high price for the required goods and frequently have to wait a long time for their orders to be fulfilled, tolerating other discomforts as well.
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ferent level of its market supply and a different level of prices (simultaneously, these all substantially exacerbate disproportions in economy which are usually only eliminated as a result of crisis). While some goods still can be produced with a certain time delay, numerous valuable resources (land, buildings, some types of raw materials, certain financial assets etc.) are greatly limited or inflexible altogether. In all cases the supply scarcity (in conditions of boom in economy when we observe full employment of all the production factors) leads to economic growth slowing down and simultaneously to the growth of prices, which creates a positive feedback loop that acts until the moment of acute crisis. The researchers of crisis wrote a lot about the scarcity of certain most remarkable types of resources, such as money, gold, credit, capitals, different types of raw materials. For example, mile Louis Victor de Laveleye explained crises by increased gold exportation during a sharp increase in demand for imported goods (see Tugan-Baranovsky 2008 [1913]). Tugan-Baranovsky himself (Ibid.: 322324) saw one of the most important crisis mechanisms in the fact that at first capital is available in surplus, then it is spent faster than it is created, which eventually leads to its lack and, as a result, to crisis and downswing. Representatives of the over-accumulation theory and some other schools frequently wrote about increasing scarcity of production factors occurring in conditions of full employment (see, e.g., Haberler 1964). However, in our opinion, this situation of increased demand for resources should be regarded in a wider context than simply a scarcity of capital, raw materials, gold, labour force, or even production factors in general. It can be represented as a trend to growth of scarcity of necessary resources supply and profitable investment spheres, as scarcity can be sensed in greatly varying fields. In this context the gap between supply and demand becomes more and more substantial as it includes new market sectors (this is indicated by the growth of prices of more and more types of resources). However, naturally, in some sectors and resources the scarcity is revealed more vividly, usually either in the most rapid-growing sector or the most profitable object of capital application. Such a situation leads to excessive, sometimes tremendous overestimation of respective assets (e.g., oil, gold or real estate). It is not surprising that it is namely in this place that the collapse occurs when
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positive upswing-stimulating feedback turns into positive downswingstimulating feedback (which leads to downfall, as will be shown later). As a result of rapid demand growth for certain resources, positive feedback arises for some time, which can be schematically outlined as follows. At this phase, an increase in scarcity of certain resources leads to growing scarcity of final products (and corresponding growth of their prices). Aspiration to increase their production, caused by this scarcity (and increased demand for final products) creates a still greater scarcity of resources etc., which leads to expanding growth of prices and demand (for some groups of goods/resources this growth can become general or explosive) and allows to be successful in this period even for those whose business looks to be lagging behind in technical terms (see, e.g., Tugan-Baranovsky 2008/1913; Schumpeter 1982).28 The growing demand is partly satisfied as a result of the fact that some capacities that have been invested into earlier begin to produce output (or there appears new capital, accumulation of which was arranged before). However, due to continuing rapid growth of demand and prices, the trend to investment expansion strengthens. As a result, this trumps the recoil effect from previous investments and creates an excessive base for overproduction, but this tends to be only much later. As Kwasnicki (2008: 3) notes, in economic systems involved into Juglar or some other business cycles, future development depends on the state of the system in the more or less distant past, as more or less lengthy time lags occur between different processes (see also Keynes 1936: ch. 22). With respect to the creation of such lags (in addition to natural time expenditures that are necessary for realization of technical, technological, and innovative processes) intermediary structures (and especially credit markets) also play an essential role.29 Thus, it is important to take into account the fact that credit and other intermediary institutes (wholesale traders and speculators buying up and accumulating by themselves commodities, currency, and shares for further resale) play
28
It should be noted that such a situation is observed in financial speculations as well. Thus, a financial pyramid can grow for a certain time namely due to a positive feedback: the faster the pyramid grows, the faster people wishing to obtain profit are attracted to it. 29 On the role of credit in creating the situation of flurry and speculation, postponing the coming of the crisis etc. see, e.g, Juglar 1889; Lescure 1908; Marx 1961 [18931894]; Tugan-Baranovsky 2008 [1913]; von Mises 1981 [1912]; Hayek 1931, 1933; Mendelson (19591964); Rothbard 1969; Minsky 1983, 1985, 1986, 2005; Haberler 1964.
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the role of such an element that a) delays the immediate reaction; b) contributes to the continuation of the marketing expansion when it has already gone beyond reasonable limits. Accordingly, this leads to the collapse scale getting exceedingly greater than it could be at greater equilibrium. Note. In our opinion, in the model of business cycle it is very important to account for the fact that this cycle always proceeds through fluctuations of supply scarcity at the upswing phase (when supply in general lags behind the demand, thus restraining the economic growth), and demand scarcity at the recession and depression phases, when supply in general substantially exceeds demand, which serves as an obstacle for economic growth (or increases the scale of recession). As a result, business activity cycle also proceeds in the framework of fluctuations between a whole range of oppositions (which largely define the main cycle parameters): inflation deflation; growth fall; positive negative expectations etc. Particular forms of specific supply scarcity or demand scarcity define to a great extent the form and character of crises at the given time in the given place. Rising prices of raw materials (e.g., cotton) more than once led to crises in England in the 19th century (see Tugan-Baranovsky 2008 [1913]; Mendelson 19591964, vol. 1; Grinin, Korotayev 2010). 8. RECESSION PHASE Acute crisis sub-phase As a result of overheating, as has been shown above, there occurs an excessive overestimation of certain key resources (which leads to their more or less strong scarcity). At first this continues to speed up the overheating further on (especially if there are opportunities for expanding the credit and speculations). However, eventually resource/asset overestimation cut off an increasing number of participants, taking the increasing amount of assets out of the game. At the end, the pyramid collapses interesting examples of such situations can be found in the histories of crises, for example, by Tugan-Baranovsky (2008 [1913]), Mendelson (1959 1964), Varga (1937), and Trakhtenberg (1963). For example, during the current financial-economic crisis excessive increase in prices of real estate in the USA and excessive expansion of mortgage lending led to crisis phenomena in banking and credit-
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financial spheres, and to bankruptcy of numerous large financial corporations. Before this bankruptcy, free capital from the mortgage sphere started being actively invested into oil price increasing. As a result, when bankruptcy and panics started, not only did oil prices collapse, but also a number of other assets, as there were no resources in the economy to support their excessively overestimated levels. Thus, the main economists' question remains the same: how can it be defined at which point irrational optimism overstates asset cost to such an extent that the risk of sudden and lengthy falls increases sharply (Greenspan 2009: 441)? Let us consider the mechanism of the transformation of the overheating sub-phase into the sub-phase of crash or acute crisis in more detail:30 1. At the peak of the overheating sub-phase there arises a situation of overstraining of economy and financial markets, which is expressed in the absence of free reserves of resources and capitals, as well as in overburdening by term liabilities that can be fulfilled only provided that the plans are realized under which credits had been taken and resources had been accumulated. 2. Occurrence of the situation of decreasing efficiency of investing new resources and credits into economy and speculations (approaching the verge where ultimate usefulness/output becomes zero or even negative). 3. Decreasing marginal returns (quite in accordance to Ricardo's law of diminishing returns). As a result the positive feedback loop the increase in the strain31 leads to the growth of prices and scarcity, whereas the latter leads to the increase in the strain brings the situation to its limit. Let us return once more to the question that the stronger is the scarcity of certain resources and investment spheres, the more fierce is the rivalry for them, and the more difficult it is for the economy to grow, as (due to the indicated rivalry, growth of prices of production factors etc.)
30
31
We regard the crash sub-phase as a relatively short period including several weeks or months, during which trends sharply break from growth to fall, often characterized by collapses, downfalls, panic etc. The not always distinctly localized point of coming awareness of not a temporary failure but a deep crisis, when crisis is being accustomed to, can be viewed as the beginning of the downswing sub-phase. Here we understand the ultimate economic strain as the ultimate involvement of all economic capacities, resources, and opportunities.
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many producers are already incapable of getting the necessary resources and are thus obliged to slow down or stop the growth of their output. With regard to this, Haberler maintains that as the transition to full employment takes place gradually (and not immediately everywhere) the simultaneous development in all the points becomes more and more difficult as more and more categories of production factors become more and more scarce. If one branch of industry increases its demand for production factors and succeeds in attracting workers by offering them higher salaries, it distracts them by this from the other branches. The same is true with respect to raw materials and half-finished products. Thus, according to Haberler, in such a situation the expansion of one branch of industry turns out to be possible only at the expense of the contraction of some other industry (Haberler 2008: 235). It should be added that this has an even greater influence on speculative business branches, where factors of profitable capital application are always limited and scarce. All this causes: ) impossibility/senselessness of participation in this race for an increasing number of participants in economic and financial activity; b) growing anxiety of an increasing number of participants of economic activity; c) tendency to risk minimization by accumulating additional insurance assets, which causes additional demand for them and an increase in their expensiveness/scarcity. New positive feedback loops appear. The growth of economic tensions, deficits and prices leads to the increase in the number of those who change their behavioral strategies making them more cautious. This, in its turn, leads to financial resources starting to be secluded from the race, which increases the strain for those continuing, so to say, speculate for the rise, in hope of further expansion acceleration, price increase, still greater asset revaluation etc. One more positive feedback loop develops: increasing number of those changing their behavior strategy leads to the strengthening trend of dealing for a fall both in direct meaning (e.g., at stock exchange) and with respect to those who stop production expansion etc.32 The growth of such moods increases the general direction for slowing down the up32
It should be noted that both trends are constantly represented in the economy, but in the overheating period the downward trend is obviously in the minority.
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ward trend, which leads to an even greater increase in the number of those changing the behavior strategy. Growth of the downward trend and the increasing number of participants in the downward direction lead to increasing difficulties for the upward trend. As a result, the participants of financial and economic activity of the upward trend become incapable of gathering enough resources for continuing their expansion. For example, the growth of stock exchange prices on certain assets, e.g., oil cannot continue any more, as there are not enough buyers for the increased price. Demand simulation is impossible due to financial resources absence. The same occurs when the growth limit is achieved for prices on real estate or certain investment goods, with consumer credit expansion, goods and services supply increase, export build-up etc.33 However, in the situation when the tension has reached its limit, the equilibrium cannot be achieved. Rollback starts due to upward trend participants being exceedingly tied up with various obligations (most commonly voluminous, urgent and costly ones, which could be fulfilled only with realization of their speculative plans). One can observe the formation of the positive feedback loop acting in the opposite direction: impossibility of plans' realization leads to the impossibility of obligation fulfillment. This leads to bankruptcy for numerous participants in financial and economic activities, which sharply increases the impossibility of obligation fulfillment. In turn, this leads to impossibility of keeping the existing prices. This leads to additional failures of still more business plans, which leads to the impossibility of obligation fulfillment. Prices go on falling and the devaluation of assets continues. As general overstrain in economic and financial sphere has achieved an extreme degree, all resources have been involved, there si33
Economic crises frequently start with stock exchange or financial crises, as in the stock exchange, in the financial sector etc. one can observe special conditions for a rapid occurrence of an acute crisis. In particular: ) these institutes are characterized by a high degree of resource concentration; their resources are more mobile than material resources and at the same time possess value for the whole economy; b) overheating scale and the degree of scarcity of highly profitable application spheres in these sectors are higher; c) there are more opportunities for speculation here, and asset turnover is higher; d) players' behavior changes are expressed in a more pronounced way; ) upward and downward trends are displayed more distinctly.
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multaneously occurs a new positive feedback, with opposite (to credit expansion) sign: price decreases cause the decline in opportunity for obtaining the necessary resources, first and foremost credit (demanding its return, its price going up, and money scarcity exacerbating sharply), which were obtained only against the hope for further price growth this leads to the necessity to sell urgently those very assets that were previously invested in this leads to further price decreases etc.34 Marxists and some other economists, starting with Sismondi (see, e.g., Marx 1961 [18931894]; Varga 1937, 1974), consider the commodity overproduction to be the main mechanism of the crisis development. Over-production plays a truly important role, but further on, at the economic downswing sub-phase, causing a remarkable reduction of output.35 However, the commodity overproduction is usually unable to produce an economic bust (acute crisis).36 That is why one may agree with Bauer who pointed out that Marx described the change of economic phases (upswings and downswing, prosperity and stagnation) rather than a dramatic moment of crisis (Kautsky, Bauer 1923: 83). Overproduction of goods can be to some extent regarded as a part of the process of supply scarcity turning into demand scarcity (it should be taken into account that not only commodities become excessive, but also capital and many other things). Thus, the acute crisis itself is not created by the commodity overproduction. Its mechanism, as has been shown above, is created by increasing difficulties with the resource accumulation for supporting the growth expansion and the resultant impossibility for a substantial part of the market participants to overcome at some point the acute scarcity
34
35
36
All this reminds of a situation with an attacking army that has come far off its rears, exhausted its resources and is attacking only by inertia. As soon as the enemy starts counterattacking, the previously attacking army starts a swift rollback. Along with that, expensive military equipment and weapons, recently essential and difficult-to-obtain, are left behind, being an obstacle hindering the rollback. Some researchers (e.g., Spiethoff) pointed to the fact that quite frequently the branches producing consumer goods experience the impact of depression much later than branches producing capital goods. Some economists express doubts on this point, but it is obvious that crises start most frequently in branches that are far from production and marketing of the mass consumption commodities. For example, in Cassel's opinion, disputable as it may be, typical modern trade-industrial boom implies neither overproduction, nor exaggerated estimate of consumer demand, but means the revaluation of the capitalists' capacity to provide capital in sufficient amounts (Cassel 1932, II: 649).
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of financial and other resources.37 This is particularly connected with a sharp credit contraction, panic sales of shares at stock markets etc. Meanwhile, the sharper the reaction, the steeper the collapse. Endogenous events within the credit market may amplify and diffuse macroeconomic shocks (Bernanke et al. 1998). This, in its turn, sharply magnifies disproportions (which are already significant due to overheating) which leads to collapse (on the role of disproportions in creating crisis see Tugan-Baranovsky 1954, 2008 [1913]; Hilferding 1981 [1910]; some important disproportions are pointed out by Marx (1961 [1894]). This creates strong structural distortion, which brings the system down. Then the events may develop in the direction that is opposite to the one that we observe with the economic growth. Demand/price decrease causes the fall of opportunity for obligation fulfillment and decreases expectations. This, in its turn, leads to investment decline and further decrease of demand (prices, business activities) until the situation comes to some equilibrium.38 As has already been mentioned, reaction to rapidly changing and negative events cannot be fully adequate; on the contrary, it is commonly irrational, inadequate, and panic. With other, more rational reactions, the sharp downfall even might not occur. However, the change of behaviors and expectations occurs very fast, which greatly exacerbates the situation. As Alan Greenspan notes, the innate human inclination to shift from euphoria to panic and vice versa seems to be eternal; the experience of numerous generations has turned out to be unable to eradicate it (Greenspan 2009: 442). Such mass movements are somewhat akin to crowd movements. Namely they create the sharp slant which, figuratively speaking, finally overturns the overloaded boat of economy. Such phenomena of sharply inadequate reactions to a changed situation
37
38
For example, getting the necessary credit for supporting the stock price, say, in connection with a number of speculators abruptly coming out of the process, with shares being sold in order to fix the profit. Let us note that the acute crisis sub-phase does not appear to be utterly inevitable. Firstly, collapse acuteness is directly connected with the degree of economy overheating. If the measures on overheating reduction are taken in time, the collapse itself can be avoided (though some fall may take place). Secondly, if in the period of credit contraction (characterized by the greatest scarcity of financial resources, major players' bankruptcies etc.) an adequate aid is given in time, there is a hope left that acute crisis and collapse may be avoided.
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in the economy are denoted by us as the board effect (see Grinin, Malkov, Korotayev 2010; Grinin, Korotayev, Malkov 2010a). If all ship passengers rush to one side (e.g., being afraid of missing something interesting), the ship may overturn, though before that it used to be relatively stable. Economic downswing sub-phase Further on, the recession phase moves from the acute crisis sub-phase to the downswing one that involves an increasing number of branches. We would suggest it reasonable to add here that if the economy is to be regarded as a single system or a single organism, it is not surprising that if one particular vitally important sub-system or vitally important organ (here it is, say, banks or stock exchange) is distorted, then the vital activity of the whole economy is disturbed, which sometimes leads to general collapse.39 As has been noted above, at the recession phase much the same positive feedback mechanisms are acting as in the upswing/expansion phase, but in the opposite direction: 1) obviously, at this phase demand decline leads to production decrease, while this latter in its turn brings about a further decline of demand; 2) production decrease causes unemployment growth, while this leads to additional demand decrease, which causes production decrease that brings about unemployment growth etc.; 3) production decrease contributes to crisis expectations growth which in turn leads to a long-term decline in investments, which contributes to production decrease; 4) production decrease creates uncertainty leading to credit supply reduction, which reduces the demand and leads to further economic decline. The downswing leads to further reduction in credit supply, which leads to a general decline in demand and further on to a decrease in output; 5) decrease of production of consumption commodities leads to an even greater decline of production of capital goods, which stipulates still further decline of consumption commodity production (among other reasons due to reducing demand for consumption commodities on the part of workers of the reduced sector of production of the means of production/capital goods).
39
As an analogue for explaining the reasons for acute crisis phase occurring due to reasons utterly insignificant at first sight, the situation on a road with heavy traffic can be regarded, where one accident (still more so several ones) momentarily paralyzes all traffic.
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And, finally, an exceedingly important feature (that is also opposite to the upswing phase) is that though production volume falls, still for a long time due to accumulated reserves and stocks, as well as to still introduced new production capacities, supply still greatly exceeds the demand. As a result, not only do the prices stop growing, but they often start falling. Inflation frequently turns into deflation. Strong correction is needed in order to return to some equilibrium, as in the previous phase the equilibrium was greatly disturbed. The excess of resources should be eliminated in some way. That is why one often speaks about paying for former prosperity and irrational behavior that accompanied it (see, e.g., Mises 1981 [1912]; Rothbard 1969; Mendelson 19591964). Increasing proportion of risky credit in market economy is the central part of the theory of Minsky, a well-known American economist (Minsky 1983, 1985, 1986, 2005). The punishment for unrestrained economy stimulation via credit is mentioned by von Mises (1981 [1912]) and other economists of different schools. In Rothbard's (1969) opinion, it was as early as the late 18th century, namely in the activity of commercial banks, which first extended credits in an unrestrained manner and then reduced them dramatically, that David Hume and David Ricardo found the key to the mystery of recurring cycles consisting of expansion and contraction, of booms and collapses, which have puzzled the researchers since the mid-18th century. 9. DEPRESSION PHASE As Rothbard (1969) notes, this phase stems almost inevitably from the preceding expansionist boom. According to him, this is the preceding inflation that makes the depression phase inevitable. Thus, the depression is the process through which the market economy gets adapted, it gets rid of extremes and distortions of the previous inflationary boom and restores a stable economic state. Within this perspective, depression turns out to be an unpleasant but necessary reaction to distortions and extremes of the preceding boom (Ibid.). It is that very phase when economic factors that were extremely important during previous phases (such as capital or credit) do not find full application. In the depression phase, for instance, one can observe accumulation of free assets, for which it is often difficult to find bor-
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rowers, and that is why interest rates fall sharply (see, e.g., TuganBaranovsky 2008 [1913]). However, at the same time, it is the phase when an active economic reconstruction is taking place. According to Keynes, before the recovery starts, a certain period of time (that is necessary for the restoration of capital efficiency) should usually pass (Keynes 1936: ch. 22). However, in our opinion, for such a recovery not only the time itself is necessary, what is really necessary are the efforts of entrepreneurs and the restoration of equilibrium; it is also very important that certain obstacles and prohibitions are removed and new stimuli for growth appear. The deeper it is, the more remarkable the reserve for growth can turn out to be. In our opinion, the greater is the reserve for development, the longer is the rise and shorter the fall. This also accounts for the fact observed by Lescure, namely that the rises in the USA in the 19th century were longer than in Europe, and industrial downswings came usually 23 years later (Lescure 1908: 241). Indeed, at that time the USA possessed tremendous reserves for development both within the country and due to inflow of immigrants and capitals. Explanation. In our opinion for a new J-cycle to be characterized by a significant rise it is necessary for limitations to be at least partially removed. Then the development field expands. As it has already been noted, a new cycle starts at a new equilibrium level (Schumpeter 1939), after passing by the depression dead point, in Spiethoff's expression (see Haberler 2008: 73). Establishment of this new equilibrium level implies that a part of the problems that led to crisis and downswing has been solved, and opportunities for development have been expanded. However, let us note that such a removal of obstacles or limitations to development is never achieved by purely technological or technical measures as is implied by the logic of Schumpeter's ideas (Schumpeter 1982).40 Even if the changes are centred on purely technical improvements, they always lead to substantial social changes. Thus, after the 1825 crisis mechanic looms started being actively introduced in England, which led to the decrease of textiles' prices and their production increasing more than 50 % by the next crisis of 1836 (see Mendelson 19591964, vol. 1). At that time, there were one million manual weav40
Sometimes it can be removed by foreign market expansion, etc.
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ers in England who generally got sufficient payments. By the next crisis (1836) their number was greatly reduced, while by the 1847 crisis there was only a meager number left (besides, the number of weavers also diminished in India). That is why the period of active economic growth (in combination with periodic crises) is commonly accompanied by significant sociopolitical and legal reorganizations. This explains why typical crises should be regarded not just as economic fluctuations, but as crises of structure which no longer corresponds to the grown economy. 10. ON THE IMPORTANCE OF FURTHER RESEARCH OF THE THEORY OF J-CYCLES After the Great Depression the interest in Juglar cycles grew sharply, and, according to Haberler (2008: 431), there was no other period in the history of economic thought when the problems of economic cycles were studied so intensively. However, later, in the second half of the 20th century (especially, during Phase A of the 4th Kondratieff Cycle), the dynamics of business cycles experienced a significant change (first of all as a result of the active interference of the state into the economic life),41 recessions became less deep than before (whereas the crisis became less dramatic), the recovery came relatively fast, etc. As a result, economists began paying more attention to long waves of business activities (Kondratieff cycles) than to Juglar cycles, though, mostly by tradition, macroeconomics textbooks still tend to include a chapter on those cycles (yet, they are mostly denoted just as business cycles42). We believe that such neglect with respect to the study of J-cycles is unproductive. In our opinion, modern crisis is quite similar in type to classical Juglar's cycle crisis.
41
42
Even some Soviet economists had to acknowledge this, e.g., Varga, a Hungarian by origin, who was influenced originally by the Austrian Economic School (e.g., Varga 1974: 366400). In particular, he noticed that the depression phase had contracted in a very significant way. The change in crisis patterns in England since the late 19th century was first noticed by TuganBaranovsky (2008 [1913]). Mitchell also showed that, though recession is a necessary part of the cycle, not every cycle should be necessarily connected with an acute crisis (Mitchell 1930: 391392). For a more detailed analysis of post-war cycles see Grinin, Korotayev 2010. See, e.g., Mankiw 1994: h. 14; Sax, Larren 1996: h. 17; Abel and Bernanke 2008: ch. 8, even though such chapters are present not in all textbooks of the kind. For example, in the textbook by Dornbusch and Fischer (1997) such a chapter is absent.
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The cyclical dynamics of Juglar type in their most pronounced form (that is, not smoothed by state intervention) was determined by the following factors: a) the presence of the gold standard in transactions within a country, as well as at the international level; b) uncontrolled dynamics of prices and interest rates; c) relatively weak interference of the state during upswings and even crises and recessions (though gradually such interference increased). These resulted in fast (sometimes even explosive) upswings (that demanded a great tension on the part of the economic system) and equally rapid downswings. The upswing, boom and overheating were accompanied by rapid and inadequate growth of prices of raw materials and real estate; an increase in intensity of speculations with commodities and stock assets; by a dramatic expansion of credit and risky operations; and the growth of investments beyond any reasonable limits. All these are salient features of the J-cycles that were described many times in the writings of representatives of various schools of economic thought (see, e.g., Juglar 1862, 1889; Lescure 1908; Tugan-Baranovsky 1954; Marx 1961 [1893, 1894]; Hilferding 1981 [1910]; Haberler 1964; Keynes 1936; Hicks 1946 [1939]; Abel and Bernanke 2008; Samuelson and Nordhaus 2005, 2009b). Such an expansion of assets tended to lift temporarily limitations produced by the metallic standard. This is almost always that during the upswing phase we observe the effect of some new financial technology (naturally, in addition to the old ones), or some new type of assets (e.g., in the 19th century this could be railway shares), that could drive the credit and speculations, amplifying the overheating of the economic system.43 The monetary component of the Juglar cycles was always exceptionally important (though this was the dynamics of real economy that was at the basis of cyclical upswings). The above indicated factors were the main ones to engender very sharp and vividly expressed cyclic features. However, gradually under the impact of the Keynesian recipes (in the framework of national eco43
For example, by the Charter of the Bank of England (as renewed in 1833), it was permissible to establish deposit joint stock banks everywhere. As a result, their number started growing rapidly which greatly contributed to the growth of capital accumulation, speculation, and at the same time to the accumulation of conditions for the 1836 crisis (for more detail see TuganBaranovsky 2008 [1913]: 110111). For more detail on the development of various new financial technologies from cycle to cycle see Grinin, Korotayev 2010.
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nomic development) it became possible to minimize these dramatic distortions of rises and falls and to put speculation under a certain control (e.g., after the Great Depression in the USA the Glass-Steagall Act was passed, forbidding banks, investment firms and insurance companies to speculate at stock exchanges [see Lan 1976; Samuelson and Nordhaus 2005, 2009b; Suetin 2009: 41]). This led to smoothing of cyclical fluctuations and to less explosive crises.44 However, currently, the crisis has evidently overgrown national borders, occurring namely as an international crisis, where national norms act in an obviously weakened form, while international regulations have not yet been worked out. That is why a number of old features recur at the new stage, because regulation methods applicable to separate countries would not work at the World System scale, still more so that the rules of such regulation have not been worked out yet. It is the theme of the next section (see also Grinin 2009, 2009e; Grinin, Korotayev 2010; Grinin, Korotayev, Malkov 2010; Grinin, Malkov, Korotayev 2009, 2010). Section 2. THE GLOBAL FINANCIAL SYSTEM: PROS AND CONS The global crisis that has somehow sobered down (at least for some time) those who believed that in the 21st century global development would proceed without crises, appears to be fading away, but still reminds of itself rather badly and the threat of one more wave of crisis remains in force. The three years' recession and depression give an opportunity to understand more clearly the causes as well as proximate and ultimate consequences of the deepest (within the last 75 years) economic crisis. The history of economic crises suggests that each of them was connected with the type of relationships within the World System.45 How44
45
In 1999 in the USA the law on financial services modernization was accepted, which annulled the Glass-Steagall Act that was in force for more than 60 years (see Suetin 2009: 41). As a basis for introducing the law on financial services modernization, it has been claimed that American credit organizations are inferior to foreign rivals, especially European and Japanese universal banks which were not subject to such limitations (Greenspan 2007). The world-system approach originated in the 1960s and 1970s due to the work by Fernand Braudel, Andre Gunder Frank, Immanuel Wallerstein, Samir Amin, and Giovanni Arrighi (Braudel 1973; Frank 1990, 1993; Frank and Gills 1993; Wallerstein 1987; Chase-Dunn and Hall 1994, 1997; Arrighi and Silver 1999; Amin et al. 2006). The term World System/world-
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ever, the strongest crises also changed in a rather significant way the World System structure, the connecting lines of this system. The current global financial-economic crisis is also likely to contribute to the beginning of the process of major changes in the World System structure and functioning, as well as in the principles of the international relations in the forthcoming decades (see Chapter 5.2). In the present section we analyze the global causes of the contemporary crisis and both the negative role of the world financial flows and their important positive functions including the insurance of social guaranties at the global scale. 1. GLOBAL CAUSES OF THE GLOBAL CRISIS The growth and deepening of financial-economic globalization has led to the unprecedented development of a number of countries and regions in the last decade (see e.g., Maddison 2007, 2010; World Bank 2010); yet, it has also caused several crises. That is why the current crisis may be considered as the reverse side of globalization (see Grinin 2008c). It is quite natural that the causes and character of the current crisis will be a subject of attentive research for quite a long time. However, it is quite evident that the main factors causing the crisis have not disappeared. Also many problems have been just temporarily dampened by an unprecedented pumping of funds that can be only justified as an extraordinary measure that can worsen the situation in the future. That is why there are some grounds to expect in the near future (within 35 years) a new outburst of the crisis. In the meantime, there is a considerable probability that the strongest manifestations of the crisis will be felt most distinctly in the fast growing Asian economies that have suffered rather moderately from the current crisis. Similar situations, with a similar asynchrony during the strongest crises with respect to Europe and North America, were observed to occur in the late 19th century and early 20th century (see e.g., Lescure 1907; Tugan-Baranovsky 1954, 2008 [1913]). The occurrence of major changes in the global division of labor between countries is associated with the most important causes of the crisis
system is used rather widely and not by world-system analysts only. For more detail on the history and contents of the World System notion see Grinin and Korotayev 2009a: 919; 2009b.
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(see Grinin 2008c, 2009a, 2009c; Grinin and Korotayev 2010a; Grinin, Korotayev, and Malkov 2010a). One of the most salient points here is that the countries of the World System center (especially the UK and USA) have developed their financial sector in the most active way.46 In the meantime the semiperipheral countries have been developing more actively the real economy. As a result, within Western economies the GDP share produced by the financial sector reaches between a quarter and a third of the total GDP, exceeding the share produced by industry. In general, within the world economy (due to the West's ability to accumulate the world capitals, as well as due to the formation and diffusion of new financial technologies) the financial sector has been growing faster than the other sectors over the last three decades. As a result of this, the financial sector has been transformed from a sector serving the economy, to a sector producing the main vector of its development; thus it has become a sector where an immense share of added value is produced. Such a division of labor has a number of important consequences. Western countries become not only the world capital accumulation center, they also become net importers of capitals. In these countries one can observe a phenomenon of deindustrialization.47 On the contrary, one can observe a fast industrial growth in the semiperipheral countries.48 This has appreciably contributed to the development of the situation when the growth rates in such developing economies e.g., the ones of the BRICS and some other semiperipheral countries are significantly higher than in the West. In the semiperipheral countries one can observe an especially fast growth of the exporting sectors, whereas the USA and some other core countries become more and more a world center of consumption whose demand determines to a considerable extent the prosperity of semiperipheral and peripheral economies. Thus, in general we can observe the decline of the role of the West as an industrial-economic center of the World System; on the other hand,
46
47
48
The World System core countries may be identified as the high income OECD countries that include 24 out of 30 members of this organization and that produced before the crisis 60 % of the world total GDP. It is worth noting that the deindustrialization now is regarded by many economists as a wrong policy. Some analysts maintain that relative wealth is flowing now from the World System center to its semiperiphery (National Intelligence Council 2008), however, the opposite view is more widespread.
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this is accompanied by the growth of its importance as an importer of commodities and capitals; correspondingly, the economic role of the semiperiphery (in general, and certain semiperipheral centers, in particular) grows; yet, their economy becomes more and more dependent on the ability of the West to consume. The consumption economy has become an imperative not only for the West, but for the World System as a whole (see, e.g., Wolf 2005). An anarchic and extremely rapid development of new financial centers, financial currents and technologies (that has secured a fast growth of the financial sector) has also contributed in an extremely significant way to the genesis of the global financial-economic crisis. Their negative role has been amplified by the lack of transparency with respect to many financial instruments and institutes, which led to the actual obscuring of risks and to the general underestimation of global risk (Kudrin 2009: 910; see also Suetin 2009; Grigoriev and Salikhov 2008). It should be noted that the aspiration for risk (which is usually characterized as a positive quality feature of an entrepreneur's psychology) should be reconsidered in conditions of globalization. If financiers (and finally other businessmen) consider the whole world to be a sphere for possible investment, and thus, given this condition, risks are counted in trillions of dollars, then to risk or not to risk stops being just a question of personal choice for individual entrepreneurs and firms. An adventurous inclination for risk (whose consequences could produce a fatal influence on the whole global economy) becomes a very dangerous feature. Consequently, it becomes necessary to control activities of such global entrepreneurs (for more detail on the crisis psychology see Grinin 2009b). 2. WHY HAVE CLASSICAL FEATURES OF PREVIOUS ECONOMIC CRISES BEEN MANIFESTED IN THE CURRENT CRISIS? The global causes of the contemporary crisis have led to an unexpected effect we observe within it some classical features of the cyclical crises of the 19th and early 20th centuries that appeared to have been eliminated. Crises in their classical form (as unexpected and even unexplainable economic collapses occurring against the backdrop of unprecedented florescence, growth of profits and prices) were typical for that
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period of time. Later, in the second half of the 20th century (in a direct connection with an active countercyclical interference of the state) the cyclical crises became much weaker and less pronounced. As it has been shown above (in Chapter 4.1) the medium-term economic Juglar cycles with a characteristic period of 711 years were typically characterized by fast (sometimes even explosive) booms (that implied a great strain on the economic system) followed by even faster collapses. The period of upswing followed by boom and overheating was accompanied (a) by a fast and inadequate growth of prices of raw materials and real estate objects; (b) by an excessive demand for credit funds and investment expansion beyond any reasonable limits; (c) by outbursts of speculations with commodity and stock assets; (d) by enormous increase in risky operations. All these are vivid features of the Juglar cycle that were described many times in studies produced by representatives of various schools of economic thought (see e.g., Juglar 1862, 1889; Lescure 1907; Tugan-Baranovsky 1954, 2008 [1913]; Marx 1993 [1893, 1894]; Mendelson 19591964; Hilferding 1981 [1910]; Keynes 1936; Hicks 1946 [1939]; Minsky 2005; Samuelson and Nordhaus 2005, 2009b; Haberler 1964 [1937]; see also Grinin, Korotayev, and Malkov 2010a; Grinin and Korotayev 2010a). All of these features have been observed in the current crisis. Our analysis has also demonstrated that almost always at the upswing phase some new financial technology (or some new type of financial assets [see Grinin, Korotayev 2010a; Grinin, Korotayev, and Tsirel 2011])49 acquires a special significance (on the appearance of new financial technologies during new economic cycles see Grinin and Korotayev 2010a). Abrupt transitions from booms to collapses were connected with spontaneous economic development that was regulated by market forces and almost nothing else, as state interference into the economic development was not sufficient. Under these conditions (against the background of the presence of gold standard) acute crises became inevitable.50 Karl Marx had already considered the anarchic
49
In the 19th century for some time this role was played by railway shares whose use made it possible on a number of occasions to expand dramatically credit and speculation, overheating the economy. 50 Thus, with the overexpansion of credit and the swelling of financial assets the amount of money substitutes (shares, promissory notes, bonds, etc.) expanded enormously (numerous proponents of the important role of supernormal credit belong to the so-called Austrian school, e.g. von Mises 1981
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character of development inherent in a capitalist economy (against the background of the economic agents' urge towards the expansion of supply) as the main cause of the economic crises. As a result of the Great Depression the role of the state in regulating the economy changed. Due to various direct and indirect ways to influence the macroeconomic framework of national economic development it became possible for the state to minimize dramatic distortions of booms and busts.51 As a result, the crises became much less pronounced than before. However, the global causes of the current crisis have made those Keynesian monetary methods of economic regulation (that are effective at the scale of a single country) ineffective at the global level. The world economy is being transformed into a single system, but technologies of the countercyclical management at the World System scale have not yet been worked out. Nation-states wage a tense competition for higher growth rates (and the question of possible limitation of those rates is not even discussed). Respectively, in the absence of the necessary level of control, the features of anarchic and arrhythmic development of nonregulated market economy become more and more salient at the World System level. This implies a certain systemic similarity between the functioning of unregulated national economy and the one of the modern global economy. We believe that this similarity accounts for the recurrence of some features of cyclical crises of the earlier epoch (see Grinin 2009a, 2009e; Grinin and Korotayev 2010a; Grinin, Korotayev, and Malkov 2010a for more detail). 1. In many respects subjects of the international economy (because of a lack of development in the financial regulation of international law) behave in a similarly uncontrolled and anarchic manner as was observed earlier with respect to subjects of a national market (i.e., because of lack of development in economic regulation of national law). As they use
[1912]; Hayek 1931, 1933). As a result, with the decrease of trust in those stocks a sudden demand for gold and cash grew so dramatically that it was able to crash the whole banking system (see, e.g., Tooke 18381857; Evans 1969 [1859]; Juglar 1862, 1889; Lescure 1907; Tugan-Baranovsky 1954, 2008 [1913]). It became possible to put speculation under some control. As it has been shown above after the Great Depression in the USA, the Glass-Steagall Act was passed, forbidding banks, investment firms and insurance companies to speculate at stock exchanges yet in 1999 in the USA the law on financial services modernization was passed, which annulled the Glass-Steagall Act.
51
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floating courses of exchange in their accounts, this leads inevitably to sharp distortions in international trade, devaluations, defaults, bankruptcies, etc. 2. The urge of states and major corporations to attain maximum growth rates in the absence of any effective macroeconomic limitations leads, at the level of the world economy and world financial system, to consequences that are analogous to the ones that were produced by uncontrollable growth and competition for market share in the capitalist economies of the 19th and early 20th centuries: overheating, bubbles, and collapse. 3. In recent decades, the movements of capitals between countries have become free (e.g., Held et al. 1999; Held and McGrew 2003b); that is, they are rather weakly regulated by national law and are hardly regulated at all by international law. This causes enormous impetuous movements of capitals that lead to very rapid upswings in some places and later, with crises, to sharp declines. 4. The development of the modern economy not only has been accompanied by the formation of new financial technologies but it has started to produce more and more added value precisely in the financial sphere (as financial services). This led to a sharp increase in the financial component of the crisis (in comparison with earlier decades when the main growth was observed in industry). 3. FINANCIAL SPECULATION: DOES IT HAVE A POSITIVE SIDE? Financial middlemen were cursed in all epochs. And there were always certain grounds to curse them. But they exist and the modern economic system cannot reproduce itself without them, as the modern market economy depends on financial middlemen of all sorts in a rather significant way, as they transform households' savings into productive investments (Greenspan 2007). The activities of modern financial corporations and funds (which lead to the uncontrolled growth of financial assets and anarchy in their movements) are quite justly criticized (e.g., Schfer 2009: 279280; see also Grinin 2008c, 2009a, 2009e; Grinin and Korotayev 2010a; Grinin, Korotayev, Malkov 2010a). However, it would not be correct to maintain that modern financial technologies are fundamentally deleterious,
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that they only lead the world economy to various troubles, that they are only beneficial to the financiers and speculators. On the contrary, both the formation and the current development of the financial sector are connected with the performance of very important functions and just at the global scale. Thus, the modern financial globalization should not only be cursed; it also has some positive sides. Summing up the achievements of what is called the financial revolution (see Doronin 2003; Mikhailov 2000; see also Held et al. 1999) we would provide our own version of the most important directions taken by the development of financial engineering (in addition to the computerization of this sphere of business). We shall also try to specify the positive influence produced by them. Those directions can be described as follows: 1. Powerful expansion of nomenclature of financial instruments and products, which leads to the expansion of possibilities to choose the most convenient financial instrument. 2. Standardization of financial instruments and products. This creates the possibility to calculate an abstract (that is, an aggregate, unified measure based on a standard package of shares and other stocks) base (and not just concrete prices of concrete securities). This secures a considerable economy of time for those who use financial instruments; it makes it possible to purchase financial securities without a detailed analysis of particular stocks; this leads to an increase in the number of participants by an order of magnitude.52 3. Institutionalization of ways to minimize individual risks. In addition to the above mentioned expansion of nomenclature and assortment of financial products, it appears especially important to mention: first, the development of special institutions specialized clearing chambers with their internal regulations (which makes it possible to avoid reliance on courts of law); second, the use of special rules and computer software, various technologies; and, third, new forms of risk hedging. All these changes help to minimize both individual risks of unfulfilled deals and also of bankruptcies in the framework of certain stock markets.53
52
53
This is similar to the situation with a wholesale purchase of a large batch of any standard commodity when the buyer has no need to examine every particular piece. However, the expansion of the operations' volume and their acceleration create a threat of global financial collapses.
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4. Increase in number of participants and centers for the trade of financial instruments. Modern financial instruments have made it possible to include a great number of people through various special programs, mediators, and structures.54 These changes result in the diffusion of technologies among the owners of capitals with various sizes (this is similar to the development of joint-stock companies that made it possible to accumulate enormous capitals). It is also possible to observe a significant increase in the number of financial centers and their specialization, as well as in the interconnectedness of national and world financial centers. It is also extremely important that we observe the growth of the number of emitters of various financial derivatives.55 The significance of the changes outlined above for the financial sector on the global stage can be described as follows: Enormous new capitals, actors, markets are accumulated and engaged, which creates a difference of potentials that is necessary for the activization of an economy that attracts capitals and investors. Due to enormous growth in volumes of operations, we observe the emergence of possibilities to extract profits from such operations, from which it was impossible to extract any profits earlier. Thus, a firm could earn just 3 cents from re-selling one share, but it may re-sell millions of such shares every day and what is more, it may re-sell the same shares dozens of times within the same day (see Callahan 2002). One may compare this with the industrial concentration of low-grade ores, whose processing was not profitable before the invention of respective technologies. The growth of diversity of financial products, the development of specialization in the production of financial services, and the increase in nomenclature of those services make it possible to smooth the demand fluctuations and to increase the general volume of sales (in fact, the growth of nomenclature of products achieves the same results within any branch of economy).56
54 55
The Foreign Exchange Market (FOREX) is the most famous among them. This is similar to the growth of the number of commodity producers with the growth of the network of units selling and servicing respective commodities. 56 We believe that the trend toward the maximum standardization of the contract conditions has consequences that are similar to the ones produced by the standardization in manufacturing: in
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Financial currents and financial centers start to structure the world economy in a new way. The market economy is always structured along certain modes of communications. One may recollect how railway construction not only altered the transportation of commodities but also changed the whole organization of economic life. Within the modern information economy the financial currents start playing a role of such system-creating communications. In those zones where we observe the most important financial currents, we may also observe the most intensive economic life. Small financial streams (like, before, small streams of commodities along the railways) create a new economic network. The new structure makes it possible for the periphery to participate actively in the world economy. It is quite clear that the spontaneous movement of capital can lead to collapses and global crises; yet, the same was observed in the 19th century when the vigorous railroad construction (accompanied by unprecedented speculations) led first to enormous upswings, and, later, to collapses. Thus, the main task is to put the most dangerous and unpredictable actions under control. 4. FINANCIAL CURRENTS AS THE WORLD PENSION FUND? Our research has made it possible to detect such global functions of the world financial sector that do not seem to have been noticed by analysts. Those functions have developed in conditions of currency not guaranteed by gold and they are connected with the necessity to protect savings in conditions of inflation against losses and risks during long periods of time. They emerged as an unintended consequence of the radical transformations in the world financial system that began in the 1970s. At that time the world financial system finally rejected the gold monetary standard as a result of the double devaluation of dollar and the collapse of the Bretton Woods monetary system. The price of gold was no longer tied to the dollar even nominally, it became free, whereas the currency exchange rate became floating. However, as a result of the rejection of the gold standard the function of savings' protection moved finally from an independent guaranboth cases the use of standards expands the sphere of the use of respective technologies and products by an order of magnitude.
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tor (i.e., precious metals) to the state.57 Yet, there was no state left, on which the capital owners could rely entirely as they could on a perfectly secure guarantor. One should add to this, the growth of inflation that especially bothered the West in the 1970s and 1980s. One should note that it was during the 1960s and 1970s that the volume of social capitals in the direct sense (i.e., various pension, social, insurance funds, including the medical insurance funds) grew very significantly in direct connection with active social legislation, the growth of the quality of life, and some demographic processes (first of all, the coming to age of the numerous baby-boom generation). There were some other important sources for the growth of capitals in the 1970s and 1980s, in addition to the above-mentioned ones. The general volume of capitals also grew due to the petrodollars, the increase in the emission of stocks, and borrowing (including the sovereign borrowing).58 In general, since that time one may observe the process of rapid growth of the volume of free capitals that should be invested somewhere. With inflation the question of where to invest capitals and funds not guaranteed by gold or hard currency becomes extremely important. This is especially relevant for capitals accumulated by pension funds, as their designation is to be found dozens of years later preserved and multiplied. Thus, it was necessary to find new ways to guarantee the preservation and multiplication of capitals.
57
Naturally, the value of gold and silver could fluctuate. One can easily recollect the so-called price revolution of the 16th century, as a result of which the prices grew four times (e.g., Goldstone 1988, 1991). But there has never been a single case when gold or silver lost their value momentously, or when their prices dropped close to zero (this eventually happens with prices of shares), whereas in the 19th and early 20th centuries (when many states applied the gold standard [Held et al.1999]) the value of money was sometimes surprisingly stable for long periods of time (the same is true for prices of many key commodities), and this allowed many people to live from the interest rates of their savings. It made it possible to rely on savings in the form of gold/silver coins to guarantee one's survival in old age or for any emergencies. Incidentally, this was a very important basis for the development of thriftiness. Today prices of precious metals are as unstable as the ones of any other assets, and the magnitude of their fluctuations is great. However, in the framework of instability of the financial system in the crisis period their prices generally tended to grow substantially or even explosively (see, e.g., Akaev, Sadovnichiy, Korotayev 2011). 58 Many years later some other sources were added to these; for example, the so called state investment funds (national development funds) that accumulated resources obtained by states through some superprofits (stemming, e.g., from the exportation of oil) and invested them in financial markets abroad. At present a few dozen of states have such funds (National Intelligence Council 2008).
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The actual abandonment of the gold standard led to the transformation of not only the world monetary system, but also to the transformation of the financial economy and all financial technology. The sharp increase in the quantity of capitals, the necessity to preserve them from inflation and to find their profitable application objectively pushed the financial market actors to look for new forms of financial activities. As a result, one could observe the start of the process of rapid growth of the volumes of financial operations, the number of financial assets, objects, instruments, and products. Some new instruments were already available at that time, and it became possible to apply them rapidly on a wide scale (see Grinin 2009, 2009e, 2009g; Grinin and Korotayev 2010b for more detail). A factor that contributed greatly to all these was nothing else but the information-computer revolution that occurred simultaneously with the financial revolution and that gave it a solid material basis. Thus, in contrast with precious metals (that retained their value even if they were not invested in anything) the modern capitals do not have such an anchor; no fortune can be accumulated in a monetary form without serious risk of a rather fast loss of a substantial part of its value (see e.g., Movchan 2010: 49). That is why if capitals just lie still (as gold in treasuries), they risk to degrade gradually into dust. What are the possible sources of their preservation and growth and, hence, what are the possibilities of the fulfillment of respective financial obligations (as well as social obligations connected with them)? The first point is a system of dynamic movements of capitals, continuous change of their forms, the engagement of new people, mediators, and services that allow them to be preserved and multiplied. The faster the movements and transformations of financial objects, the better the preservation of capitals. The second point is the distribution of risks at the global scale. We observe the growth of opportunities to distribute risks among a larger number of participants and countries, to transform a relatively small number of initial financial objects into a very large number of financial products. This makes it possible to achieve the maximum diversification by letting people choose convenient forms of financial products and to change them whenever necessary. That is why derivative financial instruments become more and more derivative, they acquire more and
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more modified forms that become more and more distant from the initial money one.59 The third point is the growth of specialization (including various forms of deposit insurance) that supports diversification and the possibilities for expansion. The additional importance of the world finances' functions with respect to the preservation and multiplication of savings in pension, insurance, and social funds is amplified every year by a very significant (and, in some sense, global) process of the finalization of the second phase of demographic transition in Western countries and Japan (see, e.g., Korotayev, Malkov, and Khaltourina 2006a). It is well known that as a result of this process the natural population growth rates declined in those countries to values that are close or even below zero; depopulation began in a number of developed countries, a rather rapid population aging is observed, whereas the proportion of pensioners in total population tends to increase in a rather dramatic way (see Fig. 10).60 The forecasts suggest a further acceleration of this process. In 2010 one can observe 1 pensioner per 4 working-age adults, whereas in 2025, according to forecasts, there will be less than 3 working-age adult per pensioner in the developed countries (National Intelligence Council 2008), and there are even more pessimistic forecasts (see, e.g., Meliantsev 2009: 30).61 Who will be filling the pension funds in the future, who will fulfil the social obligations with respect to hundreds of millions of elderly voters? Note meanwhile that, in addition to the overall growth of the number of pensioners, one can also observe simultaneously the increase in volume, complexity, and value of respective obligations (in particular, health care services).
59
60
61
One should take into account that pension funds, insurance companies etc. act as institutional investors and owners within many corporations that invest in numerous stocks and projects; this way the finances of the world have been so mixed up that it is difficult to comprehend whom exactly these particular funds belong to, whether they are good, or toxic. It is not coincidental that one of the main Alan Greenspan's concerns (about which he writes in his book [2007]) is connected with the point that the numerous generation of baby-boomers will become pensioners soon, whereas the extant financial sources are not sufficient for the complete fulfillment of social obligations with respect to them. The dramatic change of the ratio of pensioners to the working age adults may be illustrated with the following data: in 1950 in the USA the ratio of pensioners to working age adults was 1:16 while in the mid-2000s it was 1:3, i.e. it had changed fivefold (Meliantsev 2009: 30).
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Fig. 10. Number of pensioners per 100 working age adults in developed countries, 19852050
Indeed, within such a context, against the background of the slow down of the economic growth in the West and the threatening growth of state debts in many developed countries, the guarantees of pension (and other social insurance) payments do not look perfectly secure. Here one should take into account the point that most pension funds are concentrated not in the state pension funds, but in thousands of private (non-state) pension funds that are very active as regards the search for the most secure and profitable investments. Pension funds are important shareholders of listed and private companies. They are especially important to the stock market where large institutional investors dominate. The amounts of money concentrated in pension funds are enormous. The Economist (Jan 17, 2008) reported that Morgan Stanley estimates that (privately managed) pension funds worldwide hold over US $20 trillion in assets, the largest for any category of investor ahead of mutual funds, insurance companies, currency reserves, sovereign wealth funds, hedge funds, or private equity.62
62
By the end of 2005, total assets held by privately managed pension funds in the 23 countries covered in this study amounted to over US$ 15 trillion (Antolin 2008: 6).
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A lot, or a little?
Global assets under management
Latest available, $tm 0 Pension funds Mutual funds Insurance companies Official reserves Sovereign-wealth funds Hedge funds Private equity Source: Morgan Stanley 5 10 15 20 25
Fig. 11. Assets under management of various types of funds Source: Economist 2008.
So, in sum, at the world scale pension and other social funds' total volume of money is counted in dozens trillion dollars. Note that we are dealing here not with some financial derivatives or bad debts, but, in general, with honestly earned money accumulated over three to five decades that constitute a working life. The crisis led to tangible losses and even bankruptcies of many of those funds.63 How to make the preservation of those resources secure? It is easy to see, that security is a rather relative notion. The best shares can suddenly turn out to be insecure, the same goes with respect to the apparently best shares, real estate, and even state obligations. The OECD estimates the losses of pension funds in OECD countries to be $5.4 trillion or about 20 percent of the value of assets in these countries in 2008 (Hinz et al. 2010: 3; Antoln and Stewart 2009).
63
There are different estimates of their losses but all these figures are huge. Thus, according to some calculations at the end of 2008, when economies throughout the world were spinning into recession, many stock markets saw gains of the past decade completely wiped out. The value of pension fund equity holdings in the United States alone fell by $4 trillion over 2009 (Johnson and de Graaf 2009). According to other calculations, the volume of the American pension funds can be estimated for the moment of the start of the world financial crisis as about 10 trillion US dollars (Shtefan 2008) which is comparable with the total size of the US GDP (see Antolin 2008: 7).
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In 2008 the Russian State Pension Fund lost 10 billion roubles because of drop in rate of these obligations (Naumov 2008). It seems that within a single developed country it becomes more and more difficult to achieve a sufficient level of the security of pension funds. In the meantime in the developing countries we observe enormous numbers of young adults; and it is extremely difficult to provide all of them with jobs and education.
Fig. 12. Young population of more and less developed regions, mlns, 19502010
It is impossible to solve this task without an active integration of the peripheral economies into the World System economy, without the diffusion of capitals and technologies from the World System core, whereas such an integration cannot be achieved without the development of the world financial system. In the meantime the number of pensioners in the developing countries is still relatively small, the social obligations with respect to them are relatively low, 64 and only after a significant period of time the problem of the pensioners' support will become acute in those countries.
64
For example, pension fund assets in relation to respective GDP constitute 5 percent in India, and just one percent in China (Ravindran 2010).
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Against this background, the world monetary resources have already begun to take part in solving this social problem (though, naturally, they are unable to solve it completely). It appears that the redistribution of capitals throughout the whole world and the distribution of risks through investments in the diverse assets of developing countries (through numerous mediators and specialized funds) actually creates for the borrowers/recipients from the developing countries (i.e., those countries with a high proportion of young adults in their population) financial obligations that multiply the invested capitals within rather long periods of time. And those multiplied capitals will be potentially used for the payment of pensions and other social obligations in the creditor countries.65 The developing countries are very interested in attracting capitals that create jobs for the numerous cohorts of young adults. A considerable part of requested capitals come from pension, insurance, and social funds of the developed countries. In other words, to some extent the young adults of India, Indonesia, Bangladesh, Brazil, Ethiopia or Egypt will be working indirectly to support the elderly population of the core countries. Thus, those countries that are rich in demographic resources, but that are poor in capitals are involved more and more in an extremely important (though not quite apparent at the surface) process through which they participate in the support of the elderly population cohorts living in the core countries through the vigorous unification of the world financial currents, its standardization, and increasing global mobility and anonymity.66 In other words, global finances not only integrate capitals of the various regions of the world, they also contribute to the solution of an extremely
65
66
One may recall how the financial obligations of the USA (that had been forming for a very long period of time to fund various private projects) became quite unexpectedly an additional factor for the victory of the creditor countries of the Triple Entente in World War I. This was a large debt of the USA with respect to France and Britain that made it possible for them to get vitally important supplies in return for the redemption of that debt (through rather complex financial schemes). This may resemble the situation in Britain in the early 20th century when the revenues derived from the export of capitals helped to sustain a high level of life against the background of falling industrial growth rates. In this period the revenues derived from lands, houses, state loans, foreign and colonial loans constituted just a bit less than a half of all the taxable national income (Tugan-Baranovsky 2008 [1913]: 321).
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important social problem67 to support the numerous elderly population of the core countries. Within such a context one can foresee a situation when a failure of one country would be regarded as a common failure. Actually, this outruns (and prepares) political and legal globalization in some very important respects. Such interweaving of interests (as soon as it becomes evident) will make the actors move more actively toward the institutionalization of some financial and social relationships, toward a more rigorous control of financial currents, toward the full security of financial technologies. In other words, the modern financial assets and currents have become global and international, huge funds are circulating within this system (though, of course, not all its participants extract equal profits). Meanwhile, it is important to understand that a considerable percentage of the circulating sums are social (pension and insurance) money whose loss may lead to disasters with such consequences that are very difficult to forecast.68 Thus, a more secure management of the world capital has (in addition to its evident economic and social dimensions) such a dimension as the security of the future of pensioners and those in need of social protection (there are certain respective insurance systems at national levels, but what could they mean in the situation of a global financial collapse?). Hence, the issue of the institutional support of the financial globalization becomes more and more important. However, one could wonder how many new crises are necessary in order that this problem would be solved?
67
68
Note that this problem is apparently internal from the viewpoint of a single country; however, it becomes more and more difficult to solve it in the framework of a single country. The importance of accounting for useful functions (including social ones) of global money should warn us against various extremist statements such as working in a bank does not deserve to be excessively well-paid the society should not allow for people to become wealthy only because of their re-distributing financial means (from an interview with an eminent French economist Jacques Attali see Bykov et al. 2009: 103). All these recall hundred year-old declarations that capitalists do not perform useful functions in production. Indeed, as soon as the interest in enrichment through financial operations disappears, who will risk their capitals? And what will happen to them? However, this does not deny the necessity of accurate and consistent limitation of the extremes of speculations and excessive enrichments. And in this respect some Jacques Attali's ideas (in particular, his suggestion about a new, this time global, Glass-Steagall Act [Ibid.]) look rather interesting.
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5. FEELING OF THE NECESSITY OF CHANGES Today many specialists see that the main current problems of the world stock markets stem from the defects of their regulatory system (see, e.g., Doronin 2003: 129130 for an analysis of their views), though many specialists (if not most of them, at least in the United States) still believe that the problems of stock and financial markets stem from defects and imperfections of the national (rather than supranational) regulation systems. One should admit that the United States has derived some conclusions from their crisis experience; in particular, the American actors have started discussing (and taking) measures aimed at tighter regulation. They have also begun cleaning bad and toxic debts. All these are important developments, especially taking into account the special and enormous global influence of American financial institutions and instruments. The World Monetary Fund has more opportunities to affect global economy now as a result of the increase in its credit resources. However, there are strong doubts that the World Monetary Fund will be able to move significantly toward its own transformation into a sort of World Central Bank though such suppositions are sometimes made (see, e.g., Zotin 2010). The world experience demonstrates that the new principles (which should also serve as a basis for the new world financial system) do not develop from or as a result of those institutions which have already realized their functions. These, more established institutions are hardly liable to such a radical transformation. A few quite reasonable opinions have been expressed recently with respect to the possible directions of the necessary regulation of financial activities. For example, Schfer maintains the following:
Particularly risky financial products must be prohibited. At present, if one invents a new financial instrument, he can offer it to his clients the next day. For example, an inventor of a new derivative is not obliged to register it in any state agency; he can start selling it immediately. Free market proponents believe that financial markets will regulate everything themselves, that they will sort out and discard bad products by themselves. In reality this does not happen. Banks and funds threw toxic waste amounting to trillions of dollars to the market, and meanwhile they diffused a belief that one can produce really valuable stocks from a large
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Leonid Grinin. Macrohistory and Globalization number of dubious assets, whereas nobody felt being responsible for all this. But if the market cannot take responsibility upon itself, it should be assumed by the state. Financial corporations must be obliged to register in advance all the financial products that they invent (similarly to what is observed with the production of medicines in the pharmaceutical industry). A state agency should anticipatorily check and test all the financial instruments before banks get their right to sell them. And if those instruments turn out to be too dangerous, the agency should prohibit them (Schfer 2009: 279280). State agencies controlling financial markets should subdivide rating agencies in such a way that a part of them would calculate ratings, whereas the other part would provide consulting services to banks. In the meantime, rating agencies and their clients should publish all the information that has been used to calculate the rating. In this case, any other rating agency will be able to check the ascribed rating and to publish an alternative calculation if it does not agree (Ibid.: 280). Actually, the business of tax havens consists of the sucking of funds from industrially developed countries. The havens attract them with their extremely low tax rates. They offer absolute secrecy to their depositors and exempt financial corporations from any checks. That is why the industrial countries should coerce havens to abandon bank secrecy and make them inform foreign tax agencies of all the respective capitals and revenues. Havens should raise their tax rates to an internationally acceptable level. They will not do this voluntarily. That is why, if necessary, they should be coerced to do this with economic sanctions (Ibid.: 284).69
69
As is well known, in many Western countries high taxes provoked a vigorous growth of the number of those who try to avoid regulations, as well as an increase in the number of off-shore safe havens (see, e.g., Cassard 1994: 2228; Zorome 2007: 2425; Platonova et al. 2009). The 2009's G20 London meeting evidenced rather active speeches (especially on the part of Germany and France) against the off-shores. Indeed, a few resolutions aimed against them were taken, some countries (but not all the relevant countries) found themselves in the black list of states putting obstacles in the way to the international control over the tax havens. However, with economic recovery, the anti-off-shore thrust is likely to weaken, especially taking into consideration the point that some G20 countries (e.g., China and Britain) are interested in some offshores (Bykov et al. 2009: 101). There were also declarations regarding such things as the necessity to tie salaries of the managers of investment banks to mid and long range results. One should also note the pressure to reduce bank secrecy (see, e.g., Fokin 2010), though this cannot be regarded as a purely positive development.
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It is not difficult to see that this citation (with an important exception in the last section) is addressed to the national government. However, though the role of national regulation still remains very important, we observe now such a situation in the financial markets that a single state (in contrast with the previous period) cannot cope with it. Thus, as finances internationalize more and more, respective measures should be taken at the supranational level. The necessity of the transition from the national level of regulation to the supranational one has been discussed by some analysts for quite a long time (see e.g., Van Der Wee 1990; Soros 1998). Lester Thurow, as well as some other analysts, finds the cause of the instability of the world stock markets in the contradiction between the international character of operations of the world stock markets and the national nature of the stock markets themselves. However, he has very good grounds to note that, though the epoch of national economic regulation is coming to its end, the epoch of the global economic regulation has not started yet (Thurow 1996). Will radical changes in this direction take place in the near future? The transformation of the international order starts to be discussed in an especially urgent way when the world is shaken by global crises. Hence, it is not surprising that the concepts of the revision of the world order (e.g., Tinbergen 1976) emerged just in the 1970s crisis years. The crises of 19691971, monetary crises of 19711973, but especially the 19731975 crisis were indeed periods of economic chaos without any entirely comparable precedents in the post-war era (Ibid.). This stimulated the development of new ideologies of global development; particularly with respect to the relationship between developed and developing countries or sustainable development. Many of the questions posed in this period (as well as many recommendations worked out at that time) remain rather valid today. People living in any epoch always believe that their epoch with its reforms and crises is the most unique. Still we do not think that it is an exaggeration to say that the current global crisis has demonstrated, in an especially salient way, the necessity for major changes in the regulation of international economic activities and movements of world financial currents. These changes would include the need for the growth of coordinated actions by gov-
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ernments and unified international legislation regulating financial activities and movements. Actually, the world needs a new system of financial-economic regulation at the global scale. Comprehension of the causes of the crisis may provide a push to start a new round of global transformations, but the respective path (to effective transformations) appears rather long. However, even the transition to the very initial phase of a new system of supranationalnational regulation will imply rather profound changes (whereas many transformations can hardly be predicted today). The point that the political landscape and the balance of world power will change in the forthcoming decades is felt more and more strongly. On the possible future political transformations we will dwell on in the last chapter of the book.
Chapter 5 Political Aspects of Globalization

In the chapter we will discuss an important and interesting problem: why states lose their sovereignty and furthermore why they voluntary renounce their sovereign prerogatives. These processes are a part and result of globalization. However, modern world is changing rapidly. So there is some reason to divide the chapter into two sections. In the first one we will describe the processes as they have been observed before the beginning of the global financial crisis. The analysis of changes which the crisis brings about in the process of globalization and political transformation (including the sovereignty change) at the moment and in the near future are presented in the second section (see also Grinin 2009c, 2010b, 2011b; Grinin, Korotayev 2010a, 2010b). Besides, it will be devoted to estimating the probabilities of various scenarios in the development of the World System within the forthcoming decades. Section 1. WHY DO STATES LOSE THEIR SOVEREIGNTY IN THE AGE OF GLOBALIZATION? The process of globalization undoubtedly contributes to the change and reduction of the scope of state sovereign powers. The problems of national sovereignty in political science have always played the essential role since Jean Bodin's times. However, no wonder that in the last two decades there appeared new aspects in this field, especially in the context of discussing the issues of globalization and new world order. In the world political science the subject of change, diffusion, or disappearing of national sovereignty started to be raised in the late 20th early 21st century in connection with the problems of globalization and new world order (see, e.g., Giddens 1990; Walker and Mendlovitz 1990a; Barkin and Cronin 1994; Farer 1996; Gelber 1997; Held t al. 1999;
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Grinin 1999a; Gilpin 2001; Gans 2001; Courchene and Savoie 2003a; Held and McGrew 2003b; Weiss 2003; Tekin 2005; Ilyin 1993b; Ilyin and Inozemtsev 2001; Tsymbursky 1993 etc.).1 In my opinion, the processes of sovereignty change nowadays are among the most significant. It is reasonable to speak about the transition of most countries and the system of international relations in general to the new state of sovereignty. Presumably, if such processes (of course with much fluctuation) gain strength it will surely affect all spheres of life, including changes in ideology and social psychology (the moment which is still underestimated by many analysts). On the one hand, much is said about the way globalization strengthens factors that objectively weaken the countries' sovereignties. On the other hand (note that this point is debated surprisingly little and occasionally), since the postwar times, increasingly more states have been willingly and consciously limiting their sovereign rights. That is why in the present chapter in the wide context of changing national sovereignty a special attention is devoted to the study of deliberate voluntary reduction of sovereign prerogatives. So it is important to recognize that change and reduction of nomenclature and scope of state sovereign powers is a bilateral process: on the one hand, the factors are strengthening that fairly undermine the countries' sovereignty, on the other most states voluntarily and deliberately limit the scope of their sovereignty. Naturally, one can also speak about the whole range of important directions, tendencies and processes, which constitute manifold and complicated (and in many respects contradictory) dynamics of world political processes; and, as a consequence, they do not only limit sovereignty but also, in some way, evidently consolidate it (see e.g., Weiss 2003; Courchene and Savoie 2003b: 89; for the analysis of various views on these problems see Thomson 1995; Held and McGrew 2003a, 2003b). 1. WHY IS THE NOTION OF SOVEREIGNTY DIFFICULT AND AMBIGUOUS? In political science sovereignty is usually defined as the most essential attribute of the state in the form of its complete self-sufficiency i.e., its su1
For an almost exhaustive survey of such works prior to 2001 see ICISS 2001.
Chapter 5. Political Aspects of Globalization
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premacy in domestic policy and independence in the foreign one (see, e.g., Jary and Jary 1999: 311; Averyanov 1993: 367; Held 2003: 162 163). This notion became widespread in the 19th century. But already at the beginning of the Modern Age it got quite a definite interpretation in the works by Machiavelli, Bodin, Hobbes and others (see, e.g., Held 2003: 162163; Hinsley 1989; Shinoda 2000; Ilyin 1993a, 1993b, 2001). Within the Westphalian system of international relations (formed after the Thirty Year War and 1648 Peace Treaties of Westphalia, see, e.g., Gross 1948) the principles of state sovereignty gradually obtained the all-European, and then universal appreciation (see about these principles Held et al. 1999: 3738). However, it is important to note that this normative trajectory of international law was fully described only by the end of the 18th early 19th century (Ibid.: 37), this was especially connected to the events of the Great French Revolution, and also with Napoleon Wars and a new order established after the Vienna Congress in 1815 (see about it, e.g., Gelber 1997: 4; Barkin and Cronin 1994: 115; Shinoda 2000). At present the UNO Charter and some other international agreements contain regulations on the states' sovereign equality and nations' right to self-determination which together with the increasing degree of external security of most countries, in our view has sufficiently contributed to the consolidation of the idea of national sovereignty in international affairs in the second half of the 20th century. Indeed, as we will see further, the tendency toward the recognition of the sovereign rights is combined with the tendency toward their voluntarily constraint by the sovereigns themselves. However, the notion of sovereignty is one of the most difficult and ambiguous (see, e.g., Maritain 1950; Stankiewicz 1969: 291; Barkin and Cronin 1994; Krasner 2001: 134), and its content has constantly changed and continues changing in connection with the transformations of international relations and characteristics of the states themselves, even in connection with complexity of definition of the notion of state (see, e.g., Kratochwil 1986; Mitchell 1991; Barkin and Cronin 1994; see also Chapter 1.5 in this book; Grinin 2006d, 2007e; about the cradle of European state sovereignty see de Mesquita 2000; see also Ruggie 1993). This content also changed depending on who is implied as the supreme sovereign: a feudal monarch with the right to grant or split states when sharing the inheritance, an enlightened absolute monarch
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who acts on behalf of people, or the nation itself (see, e.g., Yan 1996). Besides, the sovereignty that is absolute in theory of states was always strongly and even fatally limited by different factors (see, e.g, Garner 1925; Shinoda 2000). Sovereignty can be regarded in different aspects (e.g., as positive and negative sovereignty [see Jackson 1990]) and versions. In other words, the notion of sovereignty is not univocal and indisputable but provokes numerous debates and, thus, demands a considerable elaboration, including various approaches to the classification of the states themselves possessing sovereignty. Thus, Giddens, for example, distinguishes state-nations and nation-states correspondingly as typologically earlier and later (Giddens 1985, 1990, 1991; Giddens and Pierson 1998; see also Barkin and Cronin 1994). There is a multitude of other theories, e.g., of quasi-states (Jackson 1990).2 In political science one gradually becomes aware of the necessity of re-interpretation and re-appraisal of the notion of sovereignty in connection with the emergence of the world political community, defining boundaries of private sovereignty, principles of their combination with each other and building their hierarchy, and also taking into consideration actions of other different subjects: MNC, numerous nongovernmental organizations, multinational structures and arrangements, also considering the development of various global ideologies, for example, Global Civil Society (see, e.g., Averyanov 1993: 368; Utkin 2000: 4142; Luneev 2005: 114115; Vincent 1986; Walker and Mendlovitz 1990b; Camilleri 1990; Barkin and Cronin 1994; Thomson 1995; Daniels and Alarie 2003; Johnson and Mayrand 2003; Keane 2003; Laxer and Halperin 2003; Tekin 2005). One can agree with Harry Gelber's conclusion: the last decade of the 20th century showed the incapacity of the national state to solve increasing complexity of problems of a global character (Gelber 1997: 12). In particular the 1990s witnessed
2
J. E. Thomson fairly believes that a more precise definition or a reconsideration of the definition of sovereignty is absolutely necessary (Thomson 1995). Such statements with respect to sovereignty, including the most radical ones have been already made for a long time. For instance, Jack Maritain as early as in the 1950s proved that political philosophy must eliminate sovereignty both as a term and a concept because of its supposedly inherent falsity, which misleads some researchers (Maritain 1950: 343). At present the reasoning for reconsideration of the sovereignty concept has been intensified; different versions of such a term-transformation are suggested. However, the researchers still fail to find a consensus.
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the appearance of numerous works on comprehension of different aspects of the sovereignty notion because of the events connected with the direct interference and military intervention (including the one sanctioned by the UN) with respect to particular countries such as Iraq, Somalia, Haiti, Bosnia and others (see, e.g., Mayall 1991; Roberts 1991: 519520; Helman and Ratner 19921993; Rosas 1994; Tesn 1996; Acevedo and Grossman 1996; Diamond 1996; Regan 1996).3 2. GLOBALIZATION, ECONOMY, AND WORLD POLICY Globalization is a result of a very complicated alloy of political, social, economic, civilizational and many other processes of the modern world. But among these numerous factors one should especially mark out the huge changes in modern productive forces, media, world trade and specialization (Medvedev 2004: 3; Grinin 1999, 2005, 2007b). It is significant that many researchers first of all point out the economic nature of globalization (e.g., Zuev and Myasnikova 2004: 54; Kaplinsky 2003: 4; see also, Anilionis and Zotova 2005). But one should bear in mind the significant fundamental idea that we have already maintained (Grinin 1999, 2005, 2007b, 2009b): to consider economic and technical changes as an engine of globalization means to admit the non-stop character of the process of globalization or the impossibility to break or turn it back, as nowadays it is impossible to stop or hamper the development of new technologies.4 Technology and trade entangle the world with new network connections and make national boundaries transparent (see Strange 2003; Held
3
Naturally, the reasons for military and other intervention into different countries and its legacy has always been a significant research issue (see, e.g., Eley 1972; Vincent 1974; Tillema and Wingen 1982; MacFarlane 19831984). However, in the 1990s the number of similar works sharply increased. The above-said can be proved, e.g., by the fact that in the mentioned reference (ICISS 2001) the matter of sovereignty is combined with the theme of the direct intervention (non-intervention) in the domestic affairs of sovereign countries; and more than a half of about 160 items of this bibliography are dedicated just to this theme; at the same time the absolute majority of the works is referred to the 1990s. To control the process of globalization and such appeals, as well as complaints of its chaotic and unjust character are quite noticeable (see, e.g., Martin and Shuman 2001; Stiglitz 2003; Byazrova 2004; Callinicos 2005; Homsky 2002; Lyu 2005; see also Dinello 2003; Galkin 2005) one should in the first place control directions and rates of economic and technical development that seems a utopia nowadays. However, certain obstacles on the path of this progress in the form of different regulations and quotas will probably appear in future, as I prove it in my another study (for more details see Grinin 2005; also 1999a).
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2003; Habermas 2003; Daniels and Alarie 2003; Russel 1997; Beck 2001; Castells 1999, 2002; see also Grinin 1999a, 2005, 2006e, 2007b; Katzenstein, Keohane, Krasner 1998; Reuveny 2010; Heshmati and Lee 2010; Yeoman 2010). Such a situation combined with other factors harshly complicates the conditions external towards the society (Ivanov 2000: 14; see also Kratochwil 1986; Hansen and Park 1995). And, as a result, globalization strongly reduces and changes the scope of national sovereignty and undermines the position of a state as that of the principle subject of international affairs (see Grinin 1999a, 2005, 2007b, 2009d, 2009f). Thus, changes in production forces in this or that way lead to changes of all other spheres of life including also the political one. This implies an important conclusion that we have already pointed out in other works (Grinin 2005, 2007b, 2009f): if the inevitable result of globalization appears to be the reduction of sovereignty, then it implies huge changes in behavioral patterns of states, corporations and groups, as well as of ordinary people. And though debates about destinies of a state (whether it is dying or consolidating) are quite frequent (see, e.g., Thomson 1995; Gilpin 2001; Held and McGrew 2003a: 121 125; Tekin 2005), the consequence in question is rarer discussed.5 Only quite recently in a number of works globalization (following some American political scientists) is sometimes defined as a process of the USA's will obtrusion to the rest of the world, as the process of establishing new world order, profitable for the USA (on this see Baz5
On the possible scenarios of the future it is necessary to say that some of these predictions are quite straightforward and present a simplified extrapolation of the past processes. In my opinion, the future processes will most likely reveal some circumstances which are impossible to foresee from the position of our today's experience. On the other hand, some analogies still can exist. For example, in some way the analogy is quite appropriate with rise of the centralized states in the Middle Ages and at present. And these processes usually passed with much difficulty and at the same time essentially differed in various regions and periods. Naturally, the integration at the regional and, moreover, global scale does not bear any analogy to the process of empire formation; however, it is evident that there will be more than enough compulsions and violations, breaking of stereotypes and also the morbid humiliation of national pride (for more details see Grinin 1999a, 2005, 2007b, 2009f). Speaking about future tendencies one should take into account that to my mind the assumptions about the tendency to form the new world government body sound rather doubtful (Neklessa 2002). Properly speaking, the ideas of world government emerged long ago and were popular after World War II, but they still remain unrealistic (see the analysis of the problem in question: Bull 2003: 579580; Beck 2001; Salmin 1993). We also find rather doubtful especially in respect of nowadays problems encountered by some EU members the assertions that the European Union must fairly and inevitably transform into a centralized formation like the US of Europe (Lukyanov 2005).
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hanov 2004; Brzezinski 1997; Medvedev 2004: 3; Stolyarova 2002: 72; Terentiev 2004; Collins 2002: 118). There were many prophecies that Pax Americana would be established. But the fact is that the presence of some tendencies does not mean that the future is already predetermined. Though even now the USA's influence is evident and quite real. 6 The situation is changing dramatically (for more detail see below in the second section of the chapter; see also Grinin 2010c; Grinin, Korotayev 2010c) as some scholars proposed (see, e.g., Todd 2004).7 Thus, the direction, forms and results of the processes will be constantly dependent on the changing balance of the world forces, on the strategy that will be chosen by these or those countries and associations, on different geopolitical factors and combinations. In my opinion, it means that those who are longing for playing a more important role in the integrating and changing world must forecast and foresee the tendencies to use them for their own benefits (about the available possibilities for the lesser countries see: Harris 2003: 65). Undoubtedly, Russia will be able to play an essential role in the new world order if it chooses the right strategy. Thus, one should not mourn for the globalization passing in the American style (see, e.g., rylova 2004), but find a proper place in the stream of global processes without loosing one's peculiarities, particularly using common cultural-linguistic traditions in the vast territories of the CIS, and also Russian natural geopolitical and resource advantages (this, by the way, has become apparent in the Russian economic strategy during the last several years) and develop economic strength including the renaissance or creating of different branches of machine construction and industry (there is no sufficient understanding of this point). But what after all globalization is? Its generally accepted definition does not exist and presumably it will not appear in the immediate future, as far as it has most diverse meanings (for some interpretations of globalization see, e.g., Eisenstadt 2010; Kiss 2010; Gay 2010; concerning the formal measuring of globalization see Dreher et al. 2010). Without any claim to a unequivocal definition, I would determine it in
6
Including the cultural level. One can agree that nowadays the chief globalizers are the Americans (Berger 2002). Even Zbignev Brzezinski was in some doubt concerning the effectiveness of the USA's modern policy and appeals to a deeper comprehension or reformulating foreign policy goals and the American ideology more precisely, believing that it must determine its security in such categories, which will be able to suit others' interests (see Brzezinski 2004).
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the following way. Globalization is a process as a result of which the world becomes more connected and more dependent on all its subjects. Both the increase of the quantity of problems common for states and the expansion of the number and types of integrand subjects take place. In other words the peculiar system emerges, where the problems of separate countries, nations, regions and other subjects (corporations, different associations, global media holding companies etc.) interlace into one tangle. Separate local events and conflicts influence a great number of countries. At the same time decisions in the most significant centers of the world have an effect on all the fates. In general the processes of globalization in the broadest sense are characterized by the abrupt intensification and complication of mutual contacts in the basic branches of the economic, political and social life, gaining planetary scales (Ivanov 2004: 19). Globalization is an exclusively versatile process. Practically all spheres of life experience its impact (see, e.g., Giddens 2004).8 Lots of positive as well as negative phenomena also gain a global character, e.g., the struggle for the preservation of the environment, the antiglobalistic movement itself (see, e.g., Levin 2003; Gay 2010; Xu Yanling 2010), terrorism and crime (see, e.g., Mirsky 2004b: 80; Luneev 2005: 114115), drug mafia etc. In this sense the idea of globalizing Islam and other religions is of great interest (Mirsky 2004a: 35; see also: Schaebler and Stenberg 2004; Eisenstadt 2010; Robertson 2011); human rights (Sapkota 2011; Taran 2011; Collins 2010). Any development always means that a certain part of changes makes the situation sometimes worse in comparison with the previous events (see in more detail Grinin 1997a: 6869; 2006f: 9294; 2007e). In my opinion the reducing of the scope of sovereign prerogatives leads both to positive and negative consequences (see, e.g., Kiss 2010; Bauman 2011; Etzioni 2011; Krastev 2011). Thus, the greater than before openness of boundaries provides not only the increase of trade but also contributes to the expansion of terrorism and facilitates drug traffic. At the same time, the balance of advantages and disadvantages looks different for different countries, regions, territories and even dif8
A definite vector in the direction of globalization is present even with respect to such seeming strictly national organizations, as parliaments. For example, now the number of international interparliamentary organizations is about several dozen (see, e.g., Saidov 2004).
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ferent social strata. This implies such an ambiguous perception of globalization. This is not in vain that its critics point at the irregularity in benefiting globalization and the increasing gap in the living standard of different countries (see, e.g., Capra 2004: 171).9 It is important to note that setting up the outlines of the new order, globalization thereby breaks the old one, functioning within the state system's framework, therefore, the speed of the destruction of old relations often exceeds the speed of the formation of the new ones. In particular, in a number of countries this becomes apparent in the destruction of traditional ideology, based on the sacralization of fatherland and nations, and consequently, in the weakening of such earlier highly evaluated qualities as patriotism due to the growth of alternative to the national preferences and identifications. But globalization has not created instead any complete ideology to fascinate masses. This is one of the main reasons, why Western variant of globalization seems so unacceptable for many nonWestern societies. Elsewhere I have already discussed both the above mentioned fact itself and the point that national boundaries become far less serious barrier for modern technical and economic forces than it was earlier (for more detail see Grinin 1999a; 2006e: 158159; 2007f, 2007k). Many factors contribute to this, especially the powerful development of trade, transport, and the role of the international capital, MNC etc. (see Strange 2003; Held 2003; Habermas 2003; Castells 1999, 2002). It is also worth keeping in mind that in the process of world globalization not only states but more and more territories and regions interact (Grebenschikov 2004: 89). I have also pointed out that the most rapidgrowing branches of industry are just supranational in their nature. As a case in point I can mention space technologies or Internet which are more and more actively used for commercial purposes. Figuratively speaking, a person nowadays acquires functions of a mini-station accepting and transmitting different information often leaving aside national boundaries (for more detail see Grinin 1999, 2004b, 2005).
9
Indeed it is rather an ambiguous conclusion, as in some cases, e.g. as regards to many African countries, the gap may increase (see Leftwich 2005: 153), and at the same time in the Second and Third World countries one can see a much higher than average annual economic growth. This concerns particularly some Asian and Latin American countries, and recently many African countries as well as those of the Eastern Europe and the CIS (yet today they have hard crisis of times) (see, e.g., Maddison 2001, 2007, 2010; World Bank 2005; Shishkhov 2004: 18).
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Close interconnections of national economies lead to rapid and moreover, the uncontrollable reacting to the local and a fortiori global crises. This fact has been confirmed by a number of financial crises that happened in the last two decades (on the role of capital flows we have spoken in the previous chapter; see also Grinin 2010c; Grinin, Korotayev 2010b). George Soros concludes (2000) that financial markets are unpredictable and unstable in their nature. One of the main reasons of such instability is founded on the fact that political institutes fall behind economy which overgrew national limits and requires supranational planning (Van der Wee 1994: 374) and some forms of joint control over vibration sources of financial and other markets. 3. GLOBALIZATION AND REDUCING SOVEREIGNTY As has been stated above, in practice the sovereign rights and powers both of states and nations were always limited by various factors (see, e.g., Krasner 19951996). Nevertheless, in theorists' minds Westphalian sovereignty (i.e., unlimited sovereign rights) still existed. In present days it becomes clearer that Westphalian system with its principles of international relations has fundamentally changed.10 It is also important to mention that nowadays the idea of states' free play seems wrong even from a merely theoretical point of view. The point is that the scope of the inner sovereignty has legally narrowed to a large degree due to the international agreements including the issues concerning human rights (see Averyanov 1993: 368; Vincent 1986; Chopra and Weiss 1992; Shinoda 2000) and what is more actually, in connection with already formed models and traditions of states' behavior. As Michael Mann (1997) correctly observes, in works dedicated to the transformation of the position and role of a state in the modern world we often, observe a one-sided debate on the issue whether the state system becomes stronger or weaker, meanwhile the process appears to be quite complicated and ambiguous; in some way the positions of the state system are weakening but in other ways they become stronger (see also Yan 1996: 49).11 Thus, Susanne Strange insists that
10
11
See e.g., the special issue of International Studies Review magazine, 2000, Vol. 2, No. 2, on the subject: Continuity and Change in the Westphalian Order, where this problem was discussed, especially within the following articles: Burch 2000; Blaney and Inayatullah 2000; Caporaso 2000; Litfin 2000; Mattli 2000. Probably, the difficulties in interpretation of changes in world and national policy are also connected with the debate concerning the question whether sovereignty reduces or not what takes
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under the influence of intense economic processes the state power becomes weaker and at the same time surprisingly notes that the state has started regulating the issues, which before people solved themselves without any state involvement, in particular how to build their own house, how to arrange family relations, so that in her point of view there is almost no sphere where the state bureaucracy would not intervene (Strange 2003: 128). She calls it a paradox though this is quite natural, as such processes never go unilinearly and only in a single direction. The general trajectory is always a complicated balance of alternate changes, though at the same time the system's weakening usually combines with strengthening of some its aspects it occurs at the expense of its components conversion and changes in hierarchy levels. In connection with what we have mentioned above we would like to specially emphasize the definite narrowness of the approaches even in the investigations concerning sovereignty since many authors study the issue only from the angle that powerful world economic supranational and to a great degree anonymous powers influence the transformation of national sovereignty, changing it on the whole as if in spite of or even contrary to the will of the states themselves (see, e.g., Keohane 1995; Held 2003; Clark 1999; Slaughter 2000; Strange 2003).12 At the same time another aspect of the problem is almost unnoticed (or it is not regarded sufficiently important), whereas I consider exactly an exceptionally important one: sovereignty to a large (probably, prevalent) degree is reduced voluntarily by national states themselves. I have already pointed out to those aspects and investigated them in a number of works (see Grinin 1999, 2004b, 2005, 2006e, 2007b, 2008a, 2008e, 2011b). In my opinion there is a whole range of factors which influence the process of changing national sovereignty including, of course, technoplace within the context of the old traditions of the theories of international relations and old arguments of different schools. At the same time in some scholars' communities there is an obvious tendency to consider sovereignty at the level of a theoretically pure phenomenon, which however for some reason must meet the reality. Nevertheless, quite obviously those real relations were often far from armchair scientists' ideas. No wonder, for any arguments of the supporters of the idea of reducing sovereignty their opponents produce proves of the fact that this situation is not new in history (see the analysis of various approaches to the comprehension of sovereignty phenomenon: Thomson 1995). The list of threats to the state sovereignty often includes: global financial flows, multinational corporations, global media empires, Internet, etc. and, of course, international interventions, as we see now in Libya. The globalists maintain that state authority is greatly weakened by these processes which lead to the boundaries transparency David Held and Anthony McGrew (2003a: 124) sum up such views.
12
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logical and economic changes (see above; for more details see also Grinin 1999, 1999b, 2007b, 2007f, 2007k), the aspiration for escaping wars, the presence of global problems uniting countries, the processes of the regional rapprochement, the rapid extension of the scope of contacts of all types and levels among the residents of different countries; the necessity of solving the great number of issues and settling controversial questions, increasing number of democratic regimes in the world, etc. However, the factor of voluntariness in reducing the scope of powers for the sake of gaining extra prestige and benefits may be considered among them the most significant, moreover, this very fact, as far as I can see, defines the necessity of this movement.13 Thereupon, I would like to draw attention to the major process lasting since the end of World War II, as a result of which many countries deliberately start limiting themselves in seemingly most sovereign things (for more detail see Grinin 1999, 2004b, 2005, 2006e, 2007d, 2007k, 2008a, 2009c, 2009d). It is enough even to cast a brief glance at the spheres where sovereignty has reduced to agree with above-said. The right to impose duties and taxation and define their rate; to forbid and reward import and export of goods (capitals) and some types of activity; to issue currency; to borrow; to set the rules of keeping the imprisoned and usage of their labor; to use the capital punishment; to proclaim these or those politic liberties or restrict them; to define fundamental rules of elections (and to hold them proper) and electoral qualification, and also a great number of other more or less important points, including smoking rules, have stopped to be defined only by the wishes of a state itself. Not so long ago the Europeans refused the sanctum sanctorum their own na13
Certainly, it is combined with the imposition, in some cases rather tough, on the countriesdisturber of international rules and agreements, and also with the attempts of a direct interference in the affairs of those countries (like, e.g., some republics of former Yugoslavia, Israel, Palestine, Libya, a numbers of African and Latin American countries) that turned out to be incapable of solving inner conflicts or restraining political forces beyond control (see e.g., MacFarlane 19831984; Mayall 1991; Roberts 1991: 519520; Helman and Ratner 19921993; Rosas 1994; Tesn 1996; Acevedo and Grossman 1996; Diamond 1996; Regan 1996). Naturally, such actions of the International Community or separate countries and coalitions (the USA, NATO) also have a great effect on changing of sovereignty and establishing precedents for the future. Nevertheless, it may be claimed that just predominant voluntariness in reducing sovereignty essentially contributes to the formation of a tolerant or even approving opinion to such interference on the part of the whole (or majority) of the world public, without which any intervention can neither succeed nor even take place.
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tional currencies that had been developed for centuries for the sake of one common currency (euro). Finally, what has always been regarded the main thing in sovereignty the right of war and peace is under international control. It was only 50 years ago when Russel and Einstein in their famous manifesto wrote: To extirpate war it will require measures for the limitation of the national sovereignty which will wound national pride (see Adamovich and Shakhnazarov 1988: 185). Today such a control no longer hurts national pride. World wars and totalitarianism showed that absolute sovereignty including also the right to unleash wars and repressions is dangerous.14 Hence it is possible to make an important though on the whole obvious conclusion: a state`s domestic affairs where nobody intervenes and which are regulated only by national law and traditions, are contracting and international law or law of a definite community (of collective participation) is expanding (Grinin 2005, 2007c, 2008d, 2009a, 2009d).15 Thus, one can summarize that the voluntary reduction of sovereignty means in practice and from the juridical point of view a) the expansion in national practice of the norms of some international agreements, declarations, conventions etc.; b) the recognition of these or those norms of international law as dominant over the national ones; c) the recognition of these or those decisions of a definite international agency (e.g., the court) as the dominant over the decisions of national
14
For instance, Jack Levy in his article clearly brings out that though during the last five centuries the wars between the Great Powers were diminishing in number per time unit, but on the other hand they were constantly increasing in size, heaviness, intensity, concentration and to some extent also significance (Levy 1982). 15 At the same time it is important to mention the fact that during the first post-war decades simultaneously with the increasing reduction of sovereignty the opposite processes took place, and as a consequence a modern national state became a leading type of the government on the whole planet (see, e.g., Held et al. 1999: 46), and the number of national states swiftly increased (in 1945 in there were 51 UN members, and by 1994 this number grew to 185 [The United Nations Organization 1995: 289291; Webber 1997: 24; Inoguchi 1999: 175]). But there is no contradiction here. It is just the way the complicated processes go on by the time when either these or those forms achieve their peak, their decay already reveals itself. For example, in Europe one can observe the privileges of the nobility and the most mature organizational forms of this estate at the very period of the early bourgeoisie regime formation, i.e. at the moment when the grave digger for the nobility (bourgeoisie) was actively developing. In this connection it is indicative that in the second half of the 20th century the sovereignty principles were especially actively accepted not in the developed countries (in particular in the former metropolitan countries) but vice versa at the periphery of the Western World, in the colonies getting their independence and young developing states (for more detail see: Spruyt 2000; about different historical tendencies influencing sovereignty see, e.g., Inoguchi 1999).
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bodies; d) finally, the voluntary delegation of own authorities to the supranational, regional or world associations, which seems to me an especially important and modern phenomenon. On the whole, the process of voluntary sovereignty reduction, to my mind, also signifies a profound transformation of the world political system which sooner or later will demand a formation of a definite supranational political order. Besides, this means that since today many economic and other forces act as the ones undermining national states, the new order will be created to a great degree just for the sake of getting control over these at present weakly controllable actors. And naturally, such changes and restrictions will lead to great tension, conflicts and opposition in most various spheres (see below in the second section of the chapter). Undoubtedly, in history one can find many cases of voluntary obligations and pacts, which significantly restricted the sovereignty of sovereigns and countries. Take for example the Holy Union and its interventions into the revolutionary countries in the first half of the 19th century (Male 1938), or the customs union of the German States of the first half of the 19th century (Deni and Sayo 1938: 7880). The processes of internationalization have started not today but have already been going on for centuries constantly accelerating. But as we have already mentioned (Grinin 1999a; 2005: 1617), the prevalence and power of these processes yesterday and today are incomparable, in other words at present they have obtained a qualitatively different level in comparison with past epochs. First, they have embraced the whole world. Second, the economic alliances were uncommon before and now they have become the most typical form of associations. And some of the economic organizations (such as WTO, IMF) encompass the majority of countries of the world. The scale and aims of political associations have also changed. Third, the intensity and regularity of state leaders' contacts have grown enormously. And the problems they solve have changed greatly. Fourth, only a few countries are able to carry out an isolationist policy today and avoid any associations (like the policy of brilliant isolation that Great Britain was carrying out in the 19th century). To emphasize the above said it might be mentioned (though it may sound strange) that today the maximum sovereignty (i.e., the minimum restrictions in the use of the sovereign rights) is possessed by the countries that are closed ideologically (China, Iran, Saudi Arabia and some
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other Muslim countries) and also at the same time economically (such as North Korea, or Cuba), and exactly because of their sovereign rights (in particular to create nuclear weapons) sharp conflicts tend to take place. But on the whole even these countries' sovereignty starts to diminish16. As for sufficiently open and developed countries, in our point of view the tendency to delegate their powers to the international, regional and world organizations and associations is absolutely obvious. The only exception is the USA which at times permit themselves to act regardless of many countries opinion, openly putting their national interests above the world and allied ones (see, e.g., Kissinger 2002: 2; Brzezinski 2004). But it seems to us that just in this confrontation of the USA and other countries which express a certain collective opinion, probably roots the one of the main intrigue of the change of the world in the future as well as the transformation of the content of international relations principles (see Grinin 1999: 2829; 2005: 9, 2526; see also Todd 2004). Yet recently, especially due to the crisis, the USA has not that openly opposed its interests to those the other countries. Thus, there is completely no doubt that today in comparison with the past the sovereignty of completely free and independent countries has become much smaller. And what is extremely important, many countries quite often give away a part of their sovereign powers voluntarily indeed (on the situation in some Asian countries see below). I think that such an altruism can be seriously explained only by the fact that such a restriction becomes profitable as instead the countries expect to gain quite real advantages (see, e.g., Zlokazova 2004: 68). It is quite natural that such an exchange has become possible in principle only as a result of the powerful influence of the described (and many unmentioned but implicit) processes. In my view a kind of world public opinion must be noted as an important cause of sovereignty reduction: the wider is the circle of countries voluntarily limiting their sovereignty the more inferior appear those states which do not make such restrictions. As has been mentioned above in political science it is realized to a certain degree that the doctrine of national sovereignty has become
16
This is especially true with respect to China which rapidly advances regarding its economy's openness in the foreign trade sphere, so it constantly assumes new obligations reducing its sovereign rights concerning the prohibitions, duty rates etc.
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old-fashioned (Kissinger 2002: 296), moreover, these problems were touched even in the UN Secretaries General Butros Butros-Ghali and Kofi Annan's speeches and articles (see, e.g., Annan 1999; see the analysis of his ideas in ICISS 2001). However it seems that most researchers still underestimate the gravity of sovereignty changes and the necessity to re-think this notion itself in the context of modern processes as well as a great number of others, connected with it. At the same time I agree that the state still principally remains (and will endure for quite a long time) the superior unit of historical and political life. However, the scope of the sovereign rights in the modern world has greatly redistributed. In particular, a number of quite important authorities are transferred immediately from states to supranational associations and institutes. The sovereignty is more often distributed between supranational, national, subnational, and sometimes regional and municipal units (Yan 1996: 49). Consequently, as has been mentioned above, new powerful factors have appeared and in the long run these factors gradually lead the state to stop being the principal sovereign and to give this place to larger supranational formations and structures. And in my opinion this tendency will increase. On the other hand, without fail I would like to add that this is not a one-sided and univocal but a many-sided process: sovereignty will reduce somehow (e.g., in the matters concerning economic strategy) but still in some way, it will become stronger and even grow. So, e.g., Egbert Yan considers that ethnical-linguistic, cultural and social functions of the state will increase (Yan 1996: 49). That is why it is dangerous to hurry too much to bury national state, for a long time it will remain the leading player in international affairs (as on the whole one should be cautious enough while forecasting the global political changes see, e.g., Bobrow 1999; Doran 1999). Besides, as some scholars fairly point out, the abrupt reduction of sovereignty and traditional functions of a state may cause chaos (Utkin 2000: 4142). Though sovereignty is contracting, I find this principle significant itself (more exactly the appeal to it in certain cases), that will probably long remain one of the most important in the international affairs. That is why its open disrespect will continue to provoke condemnation. When old ideas are still alive and the new ones have not become firmly established the collisions may obtain a form of opposition of principles
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which hides their historical significance. In that case it is difficult to understand who is right, who is wrong. For instance, if one bases oneself on the right of the strong to openly trample on the sovereignty principle even with respect to a dictatorial regime, the sympathy may appear on the per se reactionary side. The war in Iraq in 2003 proves this. That is why it appears that in the legal and moral aspects really irreproachable arguments are desirable which would be based on the world organizations decisions (the UNO in the first place).17 That is why to support the actions against the regimes-disturbers the sanctions of exactly this kind are important (see, e.g., Arbatov 2004: 77).18 Therefore, as has been shown above, since the end of World War II the tendency is more clearly revealed that countries gradually delegate a part of their sovereignty to the world international organizations. Even a larger part of sovereignty passes to regional associations. And the integration of states in suprastate economic associations is becoming a more and more important part of globalization. Such supranational formations are present on almost all continents and in some cases a transformation of economic alliances into political ones is outlined. Of course, the process of creating really formed, systematically and profoundly integrated suprastate formations can not be rapid. Neither will it be smooth in my opinion, since all its members can not ignore their own interests and in this or that way they will defend their interests against the others. Besides, within the countries themselves different political powers interpret national aims quite in a different way. In other words the adjustment of the supra- and intrastate interests is a difficult problem, and different confrontations are inevitable here. Besides, common aims also may be interpreted in a different way. In this sense, a very significant example is that of the USA which were able to bring together into a tight knot their purely national narrow political problems (such as the coming elections or the necessity to increase the president popularity) with world interests.
17
18
Indeed, this requires the United Nations` high prestige; however, this prestige is unfortunately rather low (see, e.g., a fascinating research about the correlation of the influence of different countries in the UNO and the contentment of their position in this organization in O'Neill 1996). Besides, to achieve their own goals the USA and NATO sometimes use the UNO resolutions yet going far beyond them. The intervention in Libya is a striking example. Concerning the problems, strategies, successful and failed actions of the international court and mediation see, e.g., Fischer 1982; Kleiboer 1996.
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4. REDUCING SOVEREIGNTY AND NATIONALISM Globalization as has been proved by different studies including mine (e.g., Ryan 1997; Bahcheli et al. 2004b; Grinin 1999, 2005, 2009a; Grinin, Korotayev 2009a) produces a dual effect with respect to nationalism. On the one hand, there can be observed a tendency to reduction of national sovereignty, on the other a heavy growth of nationalism and even the smallest nationalities' striving for gaining their own sovereignty (see about such unacknowledged nations, e.g., Bahcheli et al. 2004a). The explanation of the reasons of separatism in the present period, to which I arrived, at first glance may seem paradoxical: nationalism is gaining strength because states are weakening as systems (for more detail see Grinin 1999a, 2005, 2009b). However, there is no real paradox here, especially taking into account that the most states' security is actually provided by the world community and the strongest states (see, e.g., Pugh 1997; see also Grinin 1999a, 2005, 2007a). Besides, nations are not eternal essences, but ethnopolitical societies, forming mostly within the state framework (Gellner 1991; Balibar and Wallerstein 2003; Armstrong 1982: 4) and under the influence of technological changes (concerning the influence of printing technologies on the formation of nations see, e.g., McLuhan 2005: 408 and others).19 Under certain conditions their solidarity and homogeneity intensify, and under the others vice versa weaken. So, creating the supranational systems in the 20th century proceeded parallel with the destruction of colonial empires as well as of the old and newly created states, especially multinational ones (see, e.g., about Yugoslavia and Czechoslovakia's collapse: Bookman 1994). Note that some of them looked rather stable (the USSR, and earlier in the beginning of the process, Austria-Hungary). And such a collapse, as I see it, fulfils in a certain sense a progressive role, facilitating regional and world integration. But it is very morbid and destructive progress, which confirms the above-said ideas that a progress and regress are going hand in hand. The matter in fact is in their balance. Thus, I am inclined to believe that on the one hand, we may expect some forthcoming decades when national problems will stand sharply enough in different regions and countries, since the reasons for nationalist and secessionist conflicts are very diverse (for a survey of these
19
About the development of the views on the nature of nations and nationalism see also: Llobera 1994; Diamond and Plattner 1994; Periwal 1995; Woolf 1996; zkirimli 2000.
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grounds see, e.g., Brown 1997; Beiner 1999; Diamond and Plattner 1994; Macartney 1996 [1934]; zkirimli 2000; Voronovich and Romanchuk 2009). But, on the other hand, the belief is growing that the national right to the self-determination has turned into the opium for peoples (see Altermatt 2000: 104; about the correlation between monoethnic and polyethnic states and the reasons for the rise of nationalism in the latter see also: Zagladin et al. 1995: 180205). As Mikhail Ignatieff puts it, the narcissism of small differences between ethnoses start to flourish (Ignatieff 1999), and the consolidating ethnic ideology forms almost the main resource for the revival of the violence today (Wieviorka 2003: 109). However, at the same time although inconsistently and with difficulty, a negative attitude to the abuse of this right is formed in the world public opinion. As a consequence, in my opinion the aggressive nationalism gradually splitting up the states and producing a threat to the world order must diminish. The disappearance of nations and national differences is out of question. As we see it, the process will develop in the right direction when national affairs, problems and relations come from the sphere of the highest politics and heated fights to the quieter level, as it happened with the relations among the different directions of Christianity in the majority of European countries. However, it is worth to mention that the level of nationalism in different countries correlates with their level of economic and political-cultural development. For example, in some Asian as well other regional states, nationalism has not yet reached its culmination in contrast to European states. The matter is the level of economy and economic relations development in certain peripheral countries most probably belongs to industrial type than to a postindustrial one. Accordingly, the level of nationalism is higher there, in large regional states it is just suitable for playing the hegemonic role in their regions (see Grinin 2008a). In some Asian and Latin American states which are economically rising and ideologically consolidating, nationalism frequently emerges as a state ideology shared by the population. That is why nationalism in large regional countries as the ideology of the state and citizens quite often awakes accompanied with the striving for maintaining their sovereign rights including rights to have nuclear weapons etc. (This is a suitable way to attract the attention of the in-
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ternational community to a state during a long period as for instance Iran does.) Thus, for instance, a successful nuclear test in India has become the national pride for the Hindus although it has provoked a strong anxiety in the USA and Western countries (Srinivas 2002). In Arab countries the growth of nationalism has always been hindered by Islam, which ideologically made all Muslims brothers. But, nowadays in some Arab countries including the oil-producing ones, violent contradictions between the ideas of the state system and Islamist ideology are appearing and gaining strength as the state always requires a certain order, submission, recognition of its prevailing interests (in fact, this is the essence of domestic sovereignty) and Islamic fundamentalists believe that the interests of the state must yield to the general Islamic interests. This leads to the support of terrorism unapproved by the state, which is provided by different radical groups in Islamic countries. All this creates some tension in the society which sometimes results in the open struggle between the forces of the state sovereignty and forces of Islamic internationalism (the examples of Algeria, Turkey, Egypt are quite significant but the indicated tension exists in Saudi Arabia and in a number of other Arab countries).20 Within the general global context this means that, on the one hand, certain Islamic states will hardly fit the formation of the new world order. But on the other hand, the necessity to control fundamentalists and extremists can induce a number of Islamic states to come into closer contacts with world community. 5. DIFFERENT ISSUES OF NATIONAL SOVEREIGNTY CHANGE It is essential to show that though the process of changing and reducing sovereignty to a greater or lesser extent refers to overwhelming majority of countries still, the basic trends of voluntary reduction of the scope of sovereign prerogatives are very different in Europe, the USA, Russia, the CIS, the Islamic world, Far Eastern states, North and Tropical Africa, Latin America and other non-Western regions. Moreover, the fu20
The turbulent events of late 2010 and 2011 in a number of Arabian countries can be also considered to a certain degree as a manifestation of Arabian nationalism as in those events the political organizations took an active part which have affiliates in many Arabian countries. On the other hand, further social revolutions could contribute to the strengthening of nationalism.
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ture of non-Western cultures depends much on the way this process will proceed. First of all, it is worthy noting that the voluntary reduction of sovereignty is more characteristic of Western (or closely related with them economically or culturally) countries. And, on the contrary, the transformation of sovereignty in other civilizations and countries with different cultural traditions proceeds with more difficulty and also is closely connected with the level of economic development. These countries are usually not post-industrial, but industrial or agrarian-industrial, i.e. they belong to the type of states that are tightly connected with sovereignty and the state regulations or protection. Perhaps, just for this reason the regional powerful states like China, India,21 Pakistan and Brazil are less inclined to reduce their sovereignty as compared with the European countries. For China's and India's level the classical (Westphalian) type of state sovereignty is much more preferable than the present (or more precisely coming) type, vague and obscure one. Nevertheless, one should pay attention that Japan also is not at all in a hurry to demonstrate the reduction of its sovereignty. China's striking economic success drives a number of scientists to conclude that China will play one of the most important or even leading roles in the future global world (on this point discussion see Grinin 2010c; Grinin, Korotayev 2010c). China is vitally interested in its own economic integration into the world economy, therefore, it cannot but support globalization. But Chinese government attempts in every way to control other, especially cultural global impacts. Yunxiang Yan (2002) quite exactly calls it a guided globalization. India which has been lately demonstrating prominent economic results (Srinivas 2002) is quite an unusual for Asia power, where more or less firm democratic institutions have been established. At the same time, on the one hand, the power in India is based on the principles of modern national state, and, on the other, it represents an original model of the multicultural world, where different religions, ethnic groups, classes and castes coexist. Besides, India itself is to a certain degree an exporter of a number of other cultural models, which became the whole world's prop21
China and India need to be regarded not only as regional states but as states, which aim at transforming into superpowers. China demonstrates very active trade politic in Africa, South America and other regions.
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erty like meditation, yoga, Tantrism etc. (for more detail see Srinivas 2002). The second point is the following. As regards the particular reasons for the convergence of certain societies, it should be taken into account that in the condition of a certain bifurcation which the world is currently going through, new lines and vectors contributing to the countries uniting into supranational establishments, unions, groups, blocs and clusters depend on a variety of reasons, among which a certain feature of proximity may turn out to be critical. Beside geographical proximity, economic relations and common political (geopolitical) interests, the proximity of culture and mentality (i.e. civilizational affinity and similarity) can be the strongest in many cases. These specific political, cultural, and religious features may lead to the creation of some special regional or even interregional supranational approximation models. For example, Chilean political scientist Talavera asks, whether there is a special Latin way of action in the globalized world? He states, there is such a way and quite particular indicators exist which confirm this. Further on, he points at the formation of a development variant implying the coexistence of socioeconomic order based on openness and free market relations (i.e. a purely Western phenomenon L.G.), with a conservative socioreligious regime (Talavera 2002), i.e., let us add, a cultural form typical for a part of the old Europe. Nevertheless, in spite of all differences, the common movement to the transformation of the former type of sovereignty into this or that way is evident practically in all countries and regions, cultures and civilizations. In this connection it is necessary to show the third point connected with regional level of sovereignty transformation. A number of the developing countries are themselves ready to unite into regional communities to assert their interests together and solve problems. For example, the regional organizations in Africa, South-East Asia and Asian-Pacific region, as well as in Latin America after the Iraq events accepted a new stricter policy concerning terrorism and the use of weapons of mass destruction. However, they prefer to solve these problems in their own way on their own territory and by means of independent peacemaking organizations which they also develop themselves.22 But at the same time they start to search for the means to
22
A recent example: the threat of the Economic Community of West Africa States (ECOWAS) to start intervention to Cte dIvoire in case the President Laurent Gbagbo does not accept the re-
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minimize the risk of the violent American invasion and also of the USA using the tactics share and rule against the regional members (Bayles 2004: 75; on the issues of the global security in the Third World Countries see also: Buzan 1991). The fourth point concerns the transformation of sovereignty in respect of common tasks encountered both by developed and developing countries. Especially the matter concerns global problems (about other reasons see Grinin 1999a: 3234). They touch the whole World community, therefore, the Western interest to solve them in the underdeveloped countries will be surely increasing. And it seems the latter in their turn will have to limit sovereignty in this or that way to fit general rules. For instance, we take the risk of supposing that as demographic and ecological problems are closely connected, probably, the regulation of population level will gradually become not only national, but also a common matter. But to solve a lot of common problems it is necessary to become aware of the fact that development cannot always widen and this requires a voluntary reducing in consumption and also the mechanisms capable of forcing the majority of countries to accept such limitations (see Grinin 1999a, 2005). As Deniel Bell figuratively mentions, we have advanced enough to be capable of realizing a new vocabulary, where a key word will be limit. The limits of the rise, plundering of the environment, interference in the animate nature, armament limit etc. (Bell 1979: XXIX). And the International Commission on the Environment and development formulated the concept of the sustainable development, which was passed at the UNO conference in 1992 and which includes two notions: necessary needs and limitations (Yevteev and Perelet 1989: 50). It seems quite probable that there will be allocation of rates of the economic growth in future, as without it other limitations seem impossible to reach (for more detail see, Grinin 1999a, 2005). Peter Berger (1986, 2002) in his conception of the diversity of cultural globalizations in the world mentioned, that the final result of the global influence of the foreign culture on the native one depends much on the character of the latter, as well as on the response that the native culture is able to give to the challenge coming from the foreign (global) culture. He distinguishes four main types of variations of the relationship of these cultures: 1) the substitution of the native culture by
sults of the elections held in the country in December 2010. The later example is Saudi Arabia' troops incursion in Bahrain, as both these states are members of the Cooperation Council for the Arab States of the Gulf.
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the foreign one; 2) the co-existence of the native and global cultures without their evident amalgamation; 3) the certain synthesis of the global and partially native cultures; 4) the denial of the global culture as a result of the powerful reaction on the part of the native culture. However, probably, the number of such types of variations may be enlarged. I believe that with respect to the sovereignty prerogatives in a situation of the collision of the states with outer global influences (challenges) there may also be a whole range of types of variants connected with the character of outer influences and peculiarities of the economical and political state of the countries (society, elite). However, at the same time one should take into account that the character of the response to the transformation of sovereign rights as compared with the influence on the cultures on the whole is much more controllable on the part of the states (society), as well as the national political forces and elites. Besides, since the balance of political forces inside the state, as well as the position itself of a particular state in the world rating can essentially change23 one and the same state can make sharp turnings concerning the tractability or non-tractability with respect to the concession of sovereign rights. In the connection with the above mentioned I suggest the following typology of sovereignty transformation: Western and Russian types: the European type of the supranational community (with a number of subtypes); the type of the superpower (the American one); CISRussia (former superpower); new countries type. Typical of the young or somehow aggrieved states, which require an international support/recognition. The complete readiness to turn under the patronage of the more powerful supranational formation (voluntary taking its rules). Some non-Western types: regional leaders type. Striving for playing the role of regional leaders as India, Pakistan, Iran etc. (the tractability in one direction and non-tractability in the other);
23
It depends, for instance, on the forces which are at the helm of a state; the prevailing spirit in a society; the economic progress and failures of a society.
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the controllable globalization (by Yunxiang Yan). The necessity to maintain the entrance into economic globalization for the sake of economic benefits, but the aspiration for minimizing in every way the external influence (China); civilized/regional type. Striving for geographical, cultural or ideological regionality. Readiness to sacrifice the sovereign rights but only within the frames of the particular regions, unions, but not under the pressure of the USA or Western countries (Latin America, some African countries etc.); closed type. The aspiration for closure, and therefore, for saving the whole set of sovereignty prerogatives for the sake of maintaining a certain ideology and/or a regime (Cuba, North Korea, some Islamic countries). Such regimes yield only under a strong pressure of circumstances or powerful states. Section 2. ON THE WAY TO GLOBAL SOCIETY: THE COMING EPOCH OF NEW COALITIONS
1. ARAB SPRING AS A PRECURSOR OF THE WORLD RECONFIGURATION? The turbulent events of late 2010 and 2011 in the Arab World, including revolutions in apparently successful and dynamically developing Egypt and Tunisia (see, e.g., Korotayev and Zinkina 2011a, 2011b) confirms that the world will encounter very serious changes in the forthcoming decades (see Grinin 2009f, 2010c). Forms of their realization may be rather different ranging from slow and unapparent to sharp and sudden. When considering the Arab revolutions one may indicate a whole set of their factors both objective and subjective, local and global, logical and random. On the one hand, it is clear that a certain role has been played here by the global crisis. Note that it contributed significantly to the synchronization of political upheavals in different countries (including even such prosperous countries as Bahrain). A special role here was played by agflation (a steep rise of the agricultural commodity prices [see, e.g., Fig. 13]):
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Fig. 13. World wheat prices, $/ton, 20052011 Source: Korotayev, Zinkina 2011b: 74.
Indeed, already before the crisis, in spring 2008, the first agflation wave generated a wave of sociopolitical destabilization in a number of the Third World countries, including some Arab states. For example, in spring 2008 the protests against food price growth surged in Egypt. Global financial-economic crisis was accompanied by bubble bursts, including the food price one. As a result the prices for many food commodities fell significantly during the crisis in the second half of 2008 and early 2009. That is why despite some slowdown in economic growth rates the poor people of Egypt, paradoxically, rather benefited from the crisis, and about three millions of poor Egyptian managed to come above the poverty line (see, e.g., Siam, Abdel Rady 2010). However, global economic post-crisis recovery together with poor harvest of 2010 led to the blowing of new price bubbles in the world food market almost reaching or even exceeding the peak levels of 2008 by the end of 2010 and in early 2011, and, in our view, this certainly made a contribution to political destabilization in the Arab World in this period of time. A number of observers emphasized the role of modern technologies in the Arab Spring (see, e.g., Tausch 2011). Of course, we should also keep in mind the diffusion of the Internet and cellular telephone networks, which supplied Arab educated youths with unprecedentedly powerful means of self-organization, as well as the Arabic satellite
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channels translated exceptionally vivid images of people uprisings to all countries of the Arab world. An especially important role was played by the high proportion of the youth in the population (the so called youth bulge24) and a sharp growth of the young population in recent years. Consider, for example, the dynamics of the number of Egyptians aged 2024 in recent years (see Fig. 14):
Fig. 14. Number of Egyptian youths aged 2024, thousands, with forecast till 2015 Source: Korotayev, Zinkina 2011b: 88.
Total number of the unemployed on the eve of the Egyptian Revolution was about 2.5 million (Abd al-Rahman 2010: 4) among them there is a great number very highly educated youths. At present some political scientists even consider countries with high proportions of youth in their population as forming the Arc of Instability stretching from the Andes region of Latin America through Africa and Middle East to the northern areas of South Asia (e.g., National Intelligence Council 2008: 61). This forecast appears to be rather realistic now.
24
According to J. Goldstone, in the 20th century most revolutions happened in those developing countries where a particularly substantial youth bulge was observed (Goldstone 1991; 2002: 1112). See also Moller 1968; Mesquida, Weiner 1999; Goldstone 2002: 1011; Heinsohn 2003; Fuller 2004; Grinin, Korotayev, Malkov 2010b; Korotayev, Bogevolnov, Grinin, Zinkina, and Kobzeva 2010; Korotayev, Bogevolnov, Grinin, Zinkina, and Malkov 2010; Korotayev, Khaltourina, Kobzeva et al. 2010; Korotayev, Khaltourina, Malkov et al. 2010 for more detail.
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The Arab Revolutions should be also connected with modernization traps related, for example, to inflated levels of expectations (see, e.g., Grinin, Korotayev, Malkov 2010b; Grinin 2011d). Finally, one should mention the influence of various globalization processes (in addition to the global crisis). In particular, the presence of Arab and pan-Islamic radicalism may be regarded not just a peculiarity of a certain type of modern Islamic ideology. It may well be regarded as an indicator of the growth of globalizing processes in the present-day world. As we see the influence of globalization may be detected in the transformation and reduction of the sovereign prerogatives of the states. This was especially apparent in the point that, under the influence of the world public opinion, as well as under its direct pressure governments of such destabilized countries as Egypt, Tunisia could not apply force against rebels (in other states as Libya, Syria the use of armed forces against insurgents was strongly limited by foreign countries). Notwithstanding all the understandable factors (including those that have not been mentioned above), it is difficult not to notice that those factors do not appear to be sufficient to account completely for a striking synchronicity of the respective sociopolitical explosions. Note also that the Arab Spring turned out to be a surprise both for the absolute majority of the analysts, and for the population of the respective countries. It also appears necessary to emphasize that the level of poverty in almost all the countries affected by the disturbances is not really high for the Third World. It is clear that we are dealing here with the effect of the revolutionary influence of some countries on some others (especially, the ones that are similar in their languages and cultural characteristics), which was sometimes already observed in history after the beginning of globalization process and establishing modern WorldSystem. As such first synchronous social-ideological event one can consider the Reformation which began from Luther's Ninety-Five Theses in 1517 in Germany and quickly spread to other countries. One cannot ignore here the impact of the advanced for that time and powerful informational technology the printed word. 25 As another event of the kind one can probably consider the national revolutions in Latin America in
25
For example, during the period of emergence and strengthening of Protestantism in Europe there were published 500 millions copies of Bible (Nazarchuk 2006: 79).
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18091826 that started after Napoleon had deposed the Spanish royal dynasty in 1809. To a lesser degree the synchronicity of events was manifested in the years 183031, but nevertheless, the July Revolution in France evoked response in Belgium and Poland, as well as in some German lands. Quite obviously, the synchronicity was realized in the revolutions of 18481849 involving a number of European countries. It is significant that the revolution was closely connected with the world economic crisis of 1847 and with bad potato and grain harvests in 184547. The crop failure led to the processes analogous to modern agflation. The Russian Revolution of 19051907 also triggered a certain wave of imitations in the world and also took place after the world economic crisis of 19001903, and as a result of poor harvest in 1901, 1905, 1906. By the way, the emergence of new printing techniques and new (electric) communication means, as well as transport development contributed to the potential breaks of revolutions. The explosive character was also typical for the national liberation movements in African colonies in the late 1950s early 1960s, whose apogee was the year 1960 when seventeen new African states appeared on the world map. The last such synchronous events before the Arabian spring were the revolutions in Europe socialist countries in 19891990. 26 Thus the recent events in the Arab World are themselves important. But it is more important that here we are dealing with the effect of the start of the global reconfiguration. Let me repeat that the respective changes will take place in various (and sometimes unexpected) forms that can involve whole sets of social systems. 2. CHANGE OF LEADERSHIP OR A FUNDAMENTAL SYSTEM MODIFICATION? However, more important changes in the present-day world are occurring in other dimensions. First of all, today we observe the weakening of the economic role of the USA as the World System centre; in a more general sense we observe general weakening of the World System core
26
So the comparison of the events of 2011 and 1989 is not incidental. For example, the observer of Financial Times Gideon Rachman notes: For the Western world the Arab spring threatens to be a classic case of good news and bad news. The good news is that this is Arab 1989. The bad news is that we are the Soviet Union. Rachman, G. 2011. It's 1989, but we are the Russians. The Financial Times April 5. URL: http://www.ft.com/cms/s/0/202b56b0-5eea-11e0-a2d700144feab 49a.html#axzz1IWcr89Lz
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countries.27 There have been a great number of such forecasts (see, e.g., Todd 2003; Buchanan 2002; Inozemtsev 2008; for detail see Grinin 2009: ch. 5; Grinin, Korotayev 2010). That is why there is no doubt that sooner or later (in any case in the foreseeable future) the USA's status as the World System's leader will change and its role will diminish. American analysts are worried by this more than anyone else (see, e.g., Mandelbaum 2005; National Intelligence Council 2008). The current crisis is an important step toward the present leader's weakening. As we have already spelled out (see Grinin 2008c, 2009a, 2009e; Grinin and Korotayev 2010a: ch. 4), the former priorities and foundations of the world economic order which were based on making profits for the USA will sooner or later start to transform into a new order. In the foreseeable future such a transformation will constitute collisions of relations between USA national interests, on the one hand, and the general world interests, on the other (see Grinin 2008c, 2009b; Grinin and Korotayev 2010a: Conclusion for more detail). However, such a collision will lead to very important transformations, which, unfortunately, tend to be ignored. There is a general universal tendency to believe that in the proximate future, the USA's current tenuous leading position will be occupied by the European Union or some other country (starting with India and ending with Russia) and especcialy often it is name China (see, e.g., Frank 1997, 1998; Pantin and Lapkin 2006; Selischev A. S. and Selischev N. A. 2004; Lukonin and Mikheyev 2010; Wolfensohn 2006; for an analysis of such views see, e.g., Wang 2010). But to model the World System transformations mostly with regard to a change of its leader is a serious mistake. Today we are dealing not only with a crisis in the World System or a crisis of the World System core; rather, we are dealing with a crisis of the established model of its structure which is based on having a leader who concentrates many aspects of leadership (political, military, financial, monetary, economic, technological, and ideological ones). The USA also acts as an avantgarde of the developed countries as a whole (about some aspects of
27
This is manifested in the slow-down of the economic growth rates in the World System core and their acceleration in the most of the World System periphery (see Grinin and Korotayev 2010a; Khalturina and Korotayev 2009; Meliantsev 2009), in too rapid and anarchic deindustrialization, in the dependence on cheap imports, budget deficits, general growth of public and private debts, negative demographic developments, etc. This resurrects the ideas of the death of the West (see, e.g., Buchanan 2002).
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the USA position in the World see, e.g., Renwick 2000; Nye 2002; Bacevich 2002). Thus, we are dealing with a rather complex leadership structure: the USA leading European countries and Japan newly industrialized countries of Asia and so on. Besides, a special position is occupied by the USA's neighbors (Mexico, etc.). When we speak about the USA losing their leadership status, we should not simply surmise that there will be a change in leader of the World System. We should rather presume that there will be a radical transformation of the overall structure of the world economic and political order. The simple change of the World System leader is rather unlikely already due to the fact that no country will be able to occupy the position of leadership in a way that is equivalent to the one held by the USA today, as no country will be able to monopolize so many leadership functions. Only as a result of this factor (although there is a number of other important factors), the loss of the leading role by the USA will mean a radical transformation of the World System as a whole. First of all one should point out that the USA world leading position is unique in history. We also believe that the concentration of the world's economic, financial, military, political, and innovation-scientific potential in one centre (i.e. in the USA) after World War II was a generally positive factor (and the existence of the USSR as the alternative political and military center even amplified its positive value in some respects). Let us recollect that the USA became the World System leader after World War I. But even at that time the United States controlled only economic and financial power, it lacked equivalent political power, and did not even strive for it. Further, it should be emphasized that such a situation, i.e., the absence of a recognized World System leader, contributed significantly to a very severe economic and political World System crisis during the period between the two World Wars and also the start of the Second World War. In the 1960s one could observe a decrease in the economic role of the USA in the World System which led to the emergence of a threecenter model of economic leadership: the USA Western Europe Japan. However, it is important to note that this system was formed under the political and military (recognized and desired) leadership of the USA. This structure turned out to be rather viable for almost four dec-
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ades. It works even now; yet, if it turns out to be impossible to restore the economic dynamics of the Western economies, its role will weaken (whereas since the early 1970s one can observe a general trend toward the decline of the economic growth rates in all the three centers). Unfortunately, today those centers are not able to give much to each other as they have rather similar problems. The opportunity to strengthen themselves is connected to unifying their forces in order to preserve certain advantages inherent to developed countries (and that are also useful for the World System as a whole, see below). In a way this process would be similar to the one just after World War II through which the West strengthened itself against the backdrop of the expansion of the Communist Block and the simultaneous disintegration of its colonial empires, by uniting militarily, politically, and ideologically (and partly economically). One cannot exclude the possibility, of course, that the emergence of new revolutionary technologies could give new life to the economic development of the USA (as happened in the late 1980s and 1990s), and the West as a whole; however, first, such technologies do not seem to be likely to be developed in the forthcoming decade, and in this period the problems in the American economy will be aggravated; second, in order for such new technologies to produce major results would take a rather long period (at least 1520 years) and over that time many things are bound to change; third, even such new technologies would be unlikely to help preserve military and political leadership. Thus, it is evident that a place similar to the one held by the presentday USA cannot be occupied in future, neither by another state nor by an alliance of states. For example, according to Fareed Zakaria (2009), the functions of the World System leader can only be performed by a country that achieves dominance in ideas or ideology, in economic system, and military power. Will such an ideological leader of the world appear in the nearest future? It is doubtful. So in the foreseeable future, there will be no country (nor even, an alliance of countries) that will be able to concentrate several aspects of the World System leadership. As it is above said they are often proposed that China will replace the USA as the new World System Leader. But this function is not likely to be performed by China even if China eventually surpasses the USA with respect to its GDP volume. Those who suggest China as such
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a leader do not appear to take into consideration that its economy is not adequately innovative, that it does not develop on the basis of technologies of tomorrow (and, to some extent, even of today). This is noted even by those analysts who have rather optimistic moods with respect to the China's capabilities to sustain extremely high GDP growth rates for long time in future (e.g., Mikheev 2008: 311, 319; see also Meliantsev 2009: 123124).28 In addition, it is too much export-oriented (see, e.g. Van Pay 2010; Berger 2009). In this respect it is not sufficiently autonomous. There are no entirely autonomous economies in the world now, but there are some that are more self-sufficient than the Chinese one.29 What is more, its dynamics, power, and successes appear to be based on its ties with richer economies, they depend on their fluctuations to a considerable degree.30 We believe that the economic center of the World System cannot be based on the exporting of non-innovative (and even not sufficiently highly technological) products. Besides, the Chinese model is very resource-intensive which makes it dependent on the opportunities of extending the world raw materials production and their prices whereas China becomes the leading importer of a number of commodities. And at the same time this makes the world extractive industry extremely dependent on the Chinese economy's growth (Gel'bras 2007: 2930). In order to perform the World System centre role, the Chinese economy should become, on the one hand, innovative and highly technological (which is hardly compatible with heavy industry, or conveyor industries), and ecologically advanced on the other hand. However, China does not possess necessary conditions for this. One would need
28
However, one should not neglect the explosive growth of patent applications and patent grants in China (see, e.g., Korotayev, Zinkina, Bogevolnov 2011), as well as the point that in some spheres (e.g., in biotechnologies) China has certain undeniable innovation achievements. 29 In particular the role of exports in the Chinese economy is c. 2.5 times higher than in India (calculated on the basis of Machavariani and Tanasova 2008: 387; Meliantsev 2009: 106), though the proportion of export in the Indian GDP is constantly growing (Volodin 2008: 334). 30 The explanation of a relatively small slow-down of the economic growth rates in China, India, and some other countries during the crisis needs additional research; yet, it is already quite clear that one should take into account (1) a certain developmental inertia; (2) state efforts aimed at the stimulation of the internal demand and very considerable financial infusions; (3) the lesser role of the financial sector; (4) the high role of the state in China's model of development (Huang 2008). In addition, one cannot exclude that those countries will become victims of the next crisis, that the crisis has been delayed rather than prevented in those countries (see the previous chapter; see also Grinin and Korotayev 2010b).
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no less than 2025 years to become an innovation pioneer. We believe that in some respects it is India that is more likely to become a technological leader, but India does not have many other leadership components that China has.31 That is why the idea that in 1520 years many countries will be more attracted by China's alternative development model rather than by the Western models of political and economic development (National Intelligence Council 2008: iv), provokes serious doubts. The Western models may be criticized, whereas it is quite natural that China's successes could hardly avoid bringing attention. But it is very unlikely that any country (with a possible exception of North Korea) will try to introduce the Chinese model.32 The point is that this model simply cannot be introduced. In order to do this one would need a totalitarian communist party. Even the USSR was unable to copy the Chinese model. Not to mention that Chinese polluting model of economy can hardly suit any country. In my opinion, the issue of the restructurization of the model of the Chinese economy is tightly connected with the necessity for China to preserve the current high growth rates, whereas the latter is extremely important for the ideological prestige of the government. On the other hand, such high economic growth becomes more and more unprofitable and even in some respects destructive. So it will be better to slow it down a bit. In this connection it is symptomatic that in late February 2011, Premier Wen Jiabao announced that the target for annual GDP growth in the period of the 12th five-year plan (till 2015) is 78 % (see, e.g., Beglaryan 2011; Eichengreen 2011). This is connected with the desire to change the model of growth, with the inflation increase as well as with an evident difficulty of supporting the previous extremely high growth rates that deform the social system. Of course, it may happen as
31
In this respect, some suggestions seem to be noteworthy (National Intelligence Council 2008) which state that in ten years India will almost have reached the USA level of human and scientific capital (as measured by the model of National innovational system), while China will almost have reached the USA in terms of state receptivity to business innovations. This seems dubious but is nevertheless revealing in terms of different development vectors of these two great Asian states. Substantial differences in the export structure of Chine and India should also be noted. While in the former 90 % of export growth is supplied by growing goods exportation, in the latter 40 % of export growth accounts for the growth in service exportation, particularly in the information sector (Meliantsev 2009: 107). The USA would most probably preserve for a long time its role of the innovation leader of the World System, accounting for the fact that the USA currently produce 40 % of global expenses for research and development (Ibid.: 60). 32 Those capable have already introduced it (we mean Vietnam and Laos).
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before that the Chinese economic growing rates will exceed the targeted ones. But this will mean that it will be impossible to reject the resourceintensive and export-oriented model. Besides, the disproportion in economy and society will achieve the limit beyond which a severe crisis may occur. It is not coincidental that the analysts note overinvestment and the presence of excessive production capacities in the Chinese economy that are caused by fierce competition between provinces that struggle to attract investments and to secure high growth rates in the respective regions (e.g., Berger 2009). It will be very difficult if at all possible to change the present extensive and costly Chinese model. In any case the transition to a new and more advanced economic model focused on internal consumption and technological innovation is further complicated by the following points: ) the growth of internal consumption implies the acceleration of the growth of the living standards and Chinese labor costs (that are growing anyway); b) the growth of the labor costs is not likely to be compensated by an adequate increase in the labor productivity; c) consequently, the costs of exported commodities may increase, their competitiveness may fall, while the attractiveness of investments in China will then decrease. This may cause a slowdown of growth rates. Thus, the transition to a new type of economy in China with simultaneous preservation of its leadership in economic growth rates is quite difficult or impossible. Even though home demand will continue to develop, either it will be incapable of sufficiently replacing the export demand, or this will mean a profound structural rebuilding of the economy. Investments into infrastructure, housing construction, etc. can be locomotives of development only if sufficient resources obtained through exports are present, but combining the two directions simultaneously does not seem probable in the long run.33 A decrease in growth rate implies a state revenue decline accompanied by the aggravation of unemployment and an increase in social obligations. Basing on the aforesaid and taking into account the already attainable resource, inflation and even demographic limits, we suppose that, in spite of all possible efforts of the officials, the overfulfilment of fiveyear plan for growth rate and double average annual growth rate in
33
Economy re-orienteering turns out to be very complicated even for such developed countries as Japan. Let us remember that attempts made in Russia during several decades to re-orient the export have been unsuccessful so far.
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China will fail. In other words it seems that the most probable scenario is that during the next five years the growth rate will considerably decelerate to 67 %. We suppose that it will happen in any case (i.e. the growth will slow down under conscious act of Chinese government or under some circumstances without its will) And this is in case of favorable conditions. China will probably face more severe challenges. As a result, the same processes may start that were observed in Japan after 1975 (see, e.g., Karsbol 2010; Eichengreen 2011). The developing impulse force is still great in China, while inertia is still powerful, but it is quite obvious that all will most probably weaken. At the same time, the idea of higher living standards by the majority of China's population will be increasing at an advanced rate. This has both positive (as this inspires energy and new search motivations in some part of the population) and negative (as it increases ungrounded claims to the state and decreases the competitiveness of Chinese economy) implications. 3. HYPOTHETICAL AND REAL ALTERNATIVES Thus, the future World System will not be able to possess the same structure as the current one with an equally strong centre. What can be an alternative to the modern order in the world? Here we step upon unsteady and ungrateful soil of forecasts. Let us first consider the future structure based upon the following probable but still hypothetical suggestion. Objectively, globalization leads to the appearance of some new forms of political and economic establishments of a supranational type. The EU represents just one version of such a type, other types and forms have just been outlined or are currently being outlined. However, they may emerge rather fast at favorable conditions. The largest states (e.g., the USA, China, India) may, for quite a long time, rival such supranational establishments, but still the future ultimately lies in front of the latter, not the former. According to this hypothesis, the new World System leader (if it emerges altogether) will hardly be a separate state, but rather a (potentially increasing) block of states. Will this alliance be headed by some of the largest states of the modern world, or will it arise from a coalition of states of medium size and power? Or will such a coalition emerge on some other bases? Obviously, neither China, nor India can unite around themselves some relevant group of countries on their political (for India also civilizational) specific features. In order to become such an integrating cen-
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ter, China must change its political regime.34 For China, changing its political regime will most probably imply a severe shock (presumably even disintegration, Tibet and Xinjiang being the main candidates for separation35), while the preservation of the regime requires relying on its own capacities. The regime in China will remain solid and strong until it is capable to support the process that is quite accurately denoted by Yunxiang Yan (2002) as managed globalization. This implies the ability of the government to control diverse (cultural, in particular) global influences. That is why China is not ready to lead the process of the economic coordination of the region. But, at the same time, it will not agree to perform the role of number two (see, e.g., the opinion of a famous Japanese economist, Richard Koo [Ivanter 2009: 97]) and clearly increases the economical influence on the ASEAN countries (Kanayev and Kurilko 2010: 4344; Potapov 2010). Still, Richard Koo's statement that China sooner or later will have to burden itself with the leadership, at least in Asia (Ibid.), does not look entirely convincing. A more natural integration of the American region under the aegis of the USA (some kind of a pan-America) could theoretically revive the role of the USA as the world center. However, the disposition of political forces in Latin America is too unstable, and the level of development differs greatly among the states. Brazil has already stepped into the first line of the largest countries. Besides, quite a number of regimes are much tempted to play on confronting the USA. A union with Mexico and Canada (NAFTA), though supplying more than 85 % of the whole export for Canada and Mexico, is incapable of fulfilling such a role which could solve the above-mentioned task (Kirichenko et al. 2008: 226). Among all variants of the emergence of such hypothetical leading union the European version has the largest (though on the whole small) probability. However, the European expansion comes across natural geographical limitations, whereas the economic and political crisis in
34
It should be noted that China actively advances in respect of a more active integration with neighbors. In particular, one could mention the development of project of free trade area China+ASEAN and a united integrative space in North-East Asia with participation of Japan, China, South Korea, and possibly Russian energetic resources (see Lukonin and Mikheyev 2010; Potapov 2010; Fedorovsky 2010. Still this is just a movement towards free trade which cannot form a basis for real integration. At present only in Europe there have managed to pass from economic convergence to political integration, yet with a modest success. 35 Tibet, possessing no statehood traditions, most probably will follow the Kosovo pathway, turning into one more drug state (see, e.g., Bykov et al. 2009: 103).
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Greece, Portugal and some other countries has demonstrated many weak points of the European Union. Yet, those problems are likely to be overcome sooner or later. It cannot be also excluded that in some time we will see Turkey with its more than 70 million population entering the EU. This would turn the EU into a supra-European union (we should also account for the strengthening ties between the EU and non-European Mediterranean states). If Europe could integrate with Russia, Ukraine, and Belarus, this would give a certain impulse to restructuring the World System relations and even form some strong centre. In terms of practice, this is a highly complicated, but not an impossible scenario.36 In any case the EU must cope with financial problems, periodically encountered by one or another member. All the above-mentioned scenarios are rather unlikely. Thus, the most real alternative to the role of the USA is currently... the USA itself. That is why during the nearest one or two decades the USA will remain the most real leader if, of course, the Americans do not undermine their positions themselves (through a sharp change in foreign policy, strong devaluation of dollar, a default, or an economic collapse).37 In the current absence of an obvious leader counterweighing the USA, the world will be obliged to support the preservation of the USA as a non-alternative, though getting decrepit, center as any weakening in the USA position can lead to a great extent uncontrolled transformation of the World System. A certain imbalance cycle arises (National Intelligence Council 2008), where imbalances support each other. On the one hand, this plays into the hands of the USA, but on the other hand, the absence of strong competition for leadership greatly weakens the capacities of the USA to renewal. There exists an opinion that, though the demand for the USA leadership remains high, the interest and readiness of the USA to play the leading role may decrease, as American voters will reconsider their attitude towards economic, military and other expenses of American leadership (National Intelligence Council
36
37
However, the Europeans' high living standard and the aspiration of the new EU members to immediately attain the same level substantially decrease the impulses to adopt new members (the same, but in lesser scale, occurred during the reunification of Germany). The last two ones will indeed require fast decision-making at the global scale. Spontaneous US dollar collapse can lead to downfall of all national financial and currency systems. Along with a sharp fall of the main global currency rate the whole global economy would devalue (see Platonova et al. 2009: 88).
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2008). To put it more exactly, fluctuations in foreign policy are more possible, along with variations of the struggle between isolationism and hegemony, as a result of which foreign political activity of the USA may decline for some time. However, state transition from the policy of sheer hegemony and external expansion to passive foreign policy took place a number of times in the course of history, in particular, in Japan, Germany, and in most recent times in Russia. In uncertain conditions the number of probable scenarios can be great. Thus, the document prepared by the National Intelligence Council of the USA Global Trends 2025: A Transformed World (National Intelligence Council 2008) considers four hypothetical scenarios: A World Without the West when new forces press the West out of its leading positions in the geopolitics;38 October Surprise an ecological catastrophe; BRICs' Bust-Up a conflict between India and China over the access to vitally important resources; Politics is not Always Local when various non-state structures unite in order to develop an international program for the environmental protection and to elect a new Secretary General of the United Nations. All of them, though based on certain trends of the modernity, do not seem sufficiently real, which is admitted by the authors themselves (National Intelligence Council 2008). Given the wide range of the variants of future, it is remarkably difficult to consider all variations. That is why it is better to select certain main parameters for the analysis of the hypotheses. Let us take such an important parameter of future development as the degree of suddenness and sharpness of geopolitical and geo-economic changes. Obviously, if the process proceeds gradually, people get accustomed to it and try to put it under influence, and the system somehow has time to transform. If the changes occur suddenly, for some time there arises a vacuum of the system and order, chaos, hasty building of temporary and thus not always successful constructions. Let us view two such hypo38
As regards economic ousting of the West, which, of course, results from faster economies' growth in the periphery, there is a fundamental point to note, which will change not so fast, if at all. Currently (and it will stay this way in the foreseeable future) the development vector is still being set by the West, while the fastest-growing economies, with rare exception, are adjuncts to the Western economy. If we try to imagine that only developed countries are left in the world, without the periphery ones, life standard and the level of technology in the West would suffer much less than those in periphery countries in a vice versa situation. Besides, in this fantastic scenario the Western economy would obviously go up rather rapidly, while in the periphery a collapse would occur.
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thetical scenarios: the one of gradual change and the one of sharp change.39 In the first one, the USA power would decrease not sharply, but gradually. In this case the USA, trying to preserve its leading position, would possibly be obliged to maneuver, join some coalitions, give in sometimes in certain questions, and accept some global ideas in order not to lose leadership and to preserve the acceptable geopolitical balance. On the other hand, the USA would aspire to create something at the global scale, try to institutionalize the situation, seeking to strengthen the position of primus inter pares in some commonly accepted international and interstate agreements and interaction systems (organizations, consultations, etc.) at the same time not insisting on absolute or even evident hegemony which is present nowadays.40 Naturally, this would require great skill. This process would be more successful if the USA could, according to Brzezinski's recommendation, unite with Europe and Japan in important directions (Brzezinski 2004; for the analysis of American foreign policy and the USA position in the world see also Kagan 2003; Bacevich 2002; Jervis 2005). Given the low growth rates in developed countries, the West is objectively interested in creating such an order which would institutionally formalize some of its advantages (to some extent this would be useful for the whole World System).41 It is questionable whether this necessity could be realized in time, but the success of such an institutionalization greatly depends on whether this realization occurs sooner or later.42 This would be, so to say, a scenario of planned re-building.
39
Though the process will most probably be uneven: slow uncontrolled changes will be succeeded by large but not fatal collapses and crises, inspiring the transformation process and even changing its directions. As the forecasting experience shows, not a single forecasting model could be realized in its pure version; usually something arises, in which different trends can be seen in specific combination. 40 Wilkinson called a somewhat similar scenario unipolarity without hegemony, but with probable dominance of the USA (Wilkinson 1999). In our version some crucially important points have been added, including the necessity of trying to secure de jure the advantages in some relations. Securing the prevailing role of dollar turned out to be exceptionally important for the USA in its time. 41 An example of such securing is the definition of the five leading states having the veto right in the UN Security Council. The disposition of powers in the world is changing, while this order is not easy to alter. 42 One of the possible outcomes for the West implies quoting the economy growth rates in order to restrain the all too fast periphery development (on the possibilities of such quoting see Grinin 2009b). If the limitations cannot be achieved through direct quotes on economic growth, they
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The second scenario will occur in case when the USA changes its position dramatically, i.e. as a result of a sudden dollar collapse and especially as a consequence of an American default (say, at sudden change in the global economy resulting from a crisis sharper that the one of fall 2008; or in case when the debt security matters are not solved as in the end of July 2011). In this case the US public opinion may sway to folding up the global functions of the USA, which will additionally aggravate the vacuum of international governance. In this situation, the possibilities include anarchy (a less likely scenario) or hasty gathering (or knocking together) of some system capable of supporting the collapsing world order and solving the momentary tasks, offering certain palliative solutions and agreements which on the whole can turn out to be perspective further on. However, among all hypothetical variants the two alternative ones seem most probable to us. The first one, which is naturally more preferable, is the expansion of the club of leading global players up to a number which would allow them to influence somehow the course of world development (which will be considered further on). The second variant implies spontaneous uncontrolled development where main players will be mostly concerned with domestic problems, the politicians will mind only the popularity ratings, while the global problems will be solved in passing. The Japanese society is a good example of such self-isolation (though even there some certain trends to integration can be observed [see, e.g., Ivanter 2009: 99; Potapov 2007, 2010]), the EU also too frequently reveals reticence with their own interests. For Western countries there exists a danger of becoming hostages to a democratic system, in which the position of politicians precludes them from thinking about future, and this could ultimately turn them into demagogues and statemongers. Besides, incidents of protectionism and other anti-globalization measures are in no way excluded. In this case only unexpected shocks, such as the modern crisis, can wake Western politicians and societies up. Surges of national, civilizational, and hegemonic pride are also useful.
can still be pursued under the mask of struggling for the global ecology, for the rights of wage earners, against dishonest rivalry etc.
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4. WILL THE DEFICIT OF GLOBAL GOVERNANCE AND WORLD FRAGMENTATION INCREASE? We have already mentioned in the previous chapter that economic and financial globalization greatly advances the development of international law and political globalization (see also Grinin 2008a, 2008c, 2009c, 2009d, 2009f, 2011b). Will the political component of the World System lag behind the economic one even more in the decades to come? The answer to a great extent depends on what the economic development will be in the nearest future. Numerous economists and social scientists, presenting various arguments (sometimes basing on the dynamics of the famous Kondratieff cycles), suppose that in the next 1520 years world economic development will most probably proceed at a slower rate than in the preceding period. We support this point of view (see Grinin and Korotayev 2010a; Grinin, Korotayev, and Tsirel 2011). However, if this forecast comes true, will not the political component of the World System be able to catch up slightly? Besides, the weakening of the US leadership and the absence of an alternative (in any case leader change is a lengthy and complicated process) must obviously lead to the international system transforming faster and in a more substantial way. Consequently, we are entering a period of searching for new structural and systemic solutions within the World System, which means a considerably complicated period awaiting us in the near future. Working out and stabilizing the model of a new political order within the World System will be a complicated, lengthy, and rather contentious process. In one way or another, global governance deficit is present, and in the forthcoming decades it obviously will not disappear. Supposedly, it will become more ideologically sensible, while the project of eliminating this deficit will become relatively feasible. However, global governance requires great effort and substantial sacrifices. To what extent will the states and non-state subjects wish or be able to endure the growing burden of global governance? A refusal to divide this burden will aggravate the situation of increasing institutional lack (National Intelligence Council 2008). Seemingly, there will be quite a few countries ready to take some burden of international regulation by themselves, in the same way as nowadays only a few states take obligations to make large contri-
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butions to international organizations including the UN. That is why for some time many countries will still be interested in the USA leadership even though, as has been mentioned above, the USA itself in certain conditions may not be interested in or capable of continuing to be a leader. Certain large states rivaling the USA leadership will be most probably incapable of global governance as well. Such a situation may reveal the most important spheres whose regulation will be profitable, as well as certain important fields where it will be compulsory to participate according to international obligations. This should strengthen the trend to various collective activities, formation of associations, and developing different types of cooperation. This will also transform the global governance towards new technologies. American analysts suppose that ) in the near future the politicians and the public will have to cope with the growing demand for multilateral cooperation; b) current trends are leading to the emergence in 15 20 years of a fragmented and contradictory world; c) multipolarity and structurelessness are the main features of the future system (National Intelligence Council 2008). As regards the demand for multilateral cooperation, which is already high nowadays, it will continue to grow. It seems, however, that the growth of this demand ) gives an opportunity for certain regional states and unions to strengthen their positions; b) will contribute to faster emergence of various formats of multilateral cooperation. It should be noted that the new international order would best emerge with the formation of a sufficient number of supranational unions, coalitions, coordination centers, multilateral agreements, as well as influential NGOs and networks varying in type and scale, on the one hand, and with presence of de jure (or at least de facto) accepted institutionalized leading center of the World System. Multipolarity (though this term is interpreted differently) has become a geopolitical motto for some states and it seems to be forming (see also Nye 2002). New centers of power (primarily economic, but also military and political) are being established, causing new configurations within the World System. However, in any case multipolarity in the context of peaceful coexistence implies the presence of
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some order, so multipolarity and structurelessness are opposites to each other. Fragmentation increase would imply the World System disintegration (at least temporary). To what extent is it possible? We consider this to be unlikely due to some realities of a certain quasi-unity being customary for us. Even the crisis did not lead to disintegration; on the contrary, it united the world to some extent. Certain global conscience seems to be formed. Let us set just one example of unexpected metamorphoses of modern economic psychology. During the period of a particularly low fall of production indexes in 20082010 many economists were circulating the idea that the Chinese economy would pull the whole world out, and so things are not too disastrous. 5. THE EPOCH OF NEW COALITIONS AND SOVEREIGNTY TRANSFORMATION If we continue discussing the problem of state sovereign powers with respect to the way the process of its transformation will develop in future it is worth noting some important points. The necessity to pull up the political component of the World System and to strengthen the global regulation of financial and other agents contributes to the sovereignty transformation process, as the states must voluntarily limit themselves in some spheres, and sometimes undertake additional functions (for more detail see Grinin 2008c, 2009a, 2009b, 2009c, 2009d, 2009b, 2010c; Grinin and Korotayev 2009a, 2010b, 2010c). The global crisis has revealed the sovereignty limitations more clearly, showing that even the USA cannot act without real support of other countries. By 2025 a single international community composed of nationstates will no longer exist. Power will be more dispersed with the newer players bringing new rules of the game while risks will increase that the traditional Western alliances will weaken (National Intelligence Council 2008: iv). Indeed, the real composition of international community will most likely be more complicated in the next decades due to the addition of some supranational unions, official or unofficial councils of leaders of states and unions, temporary or constant coalitions, and, possibly, NGOs. However, sovereignty transformation within the new world order creation is not a unidirectional and unilinear process. Firstly, let me re-
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peat once again, the national state will for a long time remain the leading player in the world arena, as in the foreseeable future only the state will be capable of solving a number of questions. Secondly, sovereignty may even increase in some aspects, as the current world crisis shows once more that the fate of national economies to a great extent depends on the strength of the states and on the abilities of their leaderships. Even those who previously were ready to bury the state are claiming today that the governments should take the most radical measures. Thus, it is quite probable that the nearest future may reveal a certain renaissance of the state role and activity in the world arena. In some countries sovereign powers that had previously been (sometimes thoughtlessly) given away to supranational organizations, unions, and global capital may possibly be returned. In long-term trends such ebbs and fluctuations are not only possible but inevitable. Thus, the seemingly steady movement towards democracy in the first half of the 20th century suddenly made a swerve towards totalitarianism; the development of free market trade in the late 19th century was turned to protectionism. Thus, a return to etatism can be both rather lengthy and rather useful. Nevertheless, it should be mentioned that such a return to the increasing role of state cannot be performed on the former bases, when the benefits of a state (even within the fulfillment of undertaken obligations and the observation of common international norms) were accepted in international relations as the highest cause of its activity on the world arena. We suppose that the return of the state role cannot be successful without a substantial change in the state foreign policy ideology. In other words, we can suggest that purely egoistic interests of states will to a much lesser extent underlie the foreign policy concept and performance.43 Naturally, national egoism will not disappear altogether for a very long time (if ever at all), but it will be more disguised by supranational interests and necessities than it is now. To put it more exactly, every action may require not only a real interest, but also an ideological grounding.44 Viewing the global
43
One of the numerous examples of such egoistic approach in the position of the USA on the question of greenhouse gases emission into the atmosphere. Let us also note that foreign policy of such major countries as India, China, and Japan does not essentially possess any special ideology altogether. 44 In this respect it is useful to pay attention to the ideological position of China and a number of Western officials who mark China's great contribution to the support of the world economy dur-
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arena as a great chess board (Brzezinski 1997) where the strongest wins, while small pieces may be exchanged or sacrificed will possibly not be in demand any more. The world arena will rather be viewed as a common field of interests where rules advantageous for everybody must be stated and somehow supported. The countries will more and more remarkably define not only their own security in such categories which would accord with interests of the others, as Brzezinski advises to the USA (see Brzezinski 2004), but also all their large-scale actions. That is why it is sensed that gradually the mottos of common (regional, global, group) good will strengthen in foreign policy, though the whorepresents-the-global-interests-better formula may, as always, disguise egoistic causes.45 However, this will lead to substantial changes, generally positive. In any case, the countries continuing to roughly stand up for their national egoistic interests will eventually lose, sooner or later. Radical changes will be unavoidable in the policy of large states aimed at direct and rough domineering in global or regional scale. In this case national interests assertion, rivalry forms on the world arena, conflicts and litigations will acquire a different from now form. Rivalry will increase on directing the process of new world order formation. Rival forces will perform under mottos of a new, more honest world arrangement, for just and crisisless global development, against national (especially American) egoism etc. For conducting such a policy, allies and blocks are obviously necessary. This, regrouping of forces on the world and regional arenas will invariably start. In the struggle for a place of honor in globalization and coalitions, in organization and functioning of a new world order the phenomenon occurs which we named the epoch of new coalitions (see Grinin 2009b, 2009c, 2010c; Grinin, Korotayev 2010c). The forces playing in the world and regional arenas will have to regroup. At present, the point is a new economic order in the first place, which includes the most urgent problem
ing the crisis in general and of its particular branches. This shows that nowadays it is profitable to disguise purely egoistic national interests under the form of help to the world and West in the hour of need. 45 For sure, in modern history different actions have been and are still carried out under the aegis of common interests, in particular, intervention into dependent countries (on the part of both the USSR and the USA), pressure upon certain countries under the mottos of defending the human rights, democracy, etc. Ideological aspect will presumably substantially increase.
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of the world and regional currencies. As opposed to previous coalitions, new alliances and unions may become permanent and fixed and acquire specific supernational forms.46 As a result, new force disposition may be outlined for quite a lengthy period. Forms, particular aims and activity directions of the new coalitions will depend on numerous factors, in particular, on how far the process of making common decisions will go and what means and forms of common decision-making will be realized. Thus, it seems that the system of simple democracy (one state/participant one vote) at the World System level will hardly be viable.47 China and India cannot be equaled to Lesotho (less than 2 000 000 inhabitants) or all the more Tuvalu with the population less than 15 000. Probably, for some time the mobility of partnerships within the World System will increase, the arising coalitions may turn out to be chimerical, ephemeral, or fantastic. In the course of search for most stable, advantageous, and adequate organizational supranational forms various and even rapidly changing intermediary forms may occur, where the players of the world and regional political arenas will be searching for most advantageous and convenient blocks and agreements. For example, if population number and other parameters will be taken into account at decision-making (and quota distribution),48 countries and participants may block with each other basing on the relative advantages of everyone in order to accept a decision advantageous to them (similar to political parties). However, some of the new unions and associations may eventually turn from temporary into constant ones and accept specific supranational forms. In support of the above-said with respect to some completely unexpected alliances and coalitions one can adduce the BRIC countries forum. As is known the acronym has appeared from the note of Jim
46
47
48
Taking into account such possible enlargement one may note that today in the economical surveys there are often discussed not particular countries, but whole large regions or continents (Asia, Asian-Pacific region, Africa or its parts etc.), at that the recommendations are given just to the whole groups of countries as certain economic entities. The EU experience shows that this substantially restrains the development process, while such rules in the global representations will simply block it up. There exists an index of national power measurement which integrates GDP measurements, defense expenses, population and the state of technology. Some indexes may serve as a basis for institution at the counting of quotes and votes.
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O'Neillin (the analyst of Goldman Sachs) in November 2001. But unexpectedly the speculative constructions came alive and in 2009 the first summit of the BRIC countries was held in Yekaterinburg in Russia, and then in 2010 in Braslia (Brazil). Then this group of four invited the fifth member South Africa and BRIC had been transformed into BRICS. In April 2011 the BRICS first summit took place in China on the Hainan Island. This summit is rather an image project for the countries with developing economy, but the BRICS has development prospects as an expert says. One can agree with Fyodor Lukyanov,49 the Editor-in-Chief of the journal Russia in Global Policy that it is profitable for these countries to show their peculiar status in world system At present for each of them it is just the matter of prestige Lukyanov adds that with time the association will become more and more promising (Surnachaeva and Artemyev 2011). It is, of course, difficult to forecast, but the main thing is that contemporary alliances can emerge by chance and due to quite unexpected reasons. The globe becomes rather tight for making friends even being far from each other. That is why there appear quite different geopolitical fantasies, some of which are quite probable to come alive as it happened with BRIC. Among such kind of geopolitical fantastic combinations one can cite the appearance of Chinindia or Chindia as a probable in some aspects association (concerning this point there is a number of speculations of different kind as well as analytics50). Some new imperatives of global law will start being worked out in the same process. This idea is quite supported by the events connected with the modern global crisis, in particular the G-20 meetings. Direction towards such supranational regulation forms is obvious, though it is unclear whether namely G-20 will become a constant organ, as 20 is possibly too great a number. However, as it has been stated above, another variant of leading players' club expansion is possible. Bringing the number of G club members up to at least 1112, i.e. 7 plus BRIC (or BRICS)
49
The information about BRICS summits can be found at http://archive.kremlin.ru/events/chron/ 2009/ 06/217951.shtml (in Russian). 50 See, e.g., Chinindia: More Challenges and More Opportunities (Kumar 2011a); The CHINDIANS Reshaping the future of the global economy (Kumar 2011b); Chindi (Chindia n.d.); Will Chindia Rule the World in 2050, or America after all? (Ambrose 2011).
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countries could already make this organ more influential than it is today. However, presidential meetings once a year or even more rarely, and even ministerial meetings do not suffice. Such meetings bear more of a ritual than practical character. In order to make such an organ not just influential, but a real global one, at least de facto, it is necessary to arrange the formats of negotiations, consultations, private agreements etc. on various levels and in different combinations. One more form, much less likely but, in our opinion, much more desirable, would be the form of certain union representation. It would be reasonable to create a certain organ representing 1015 leading establishments of the world (EU, OAS, LAS, CIS, etc.). Its sessions could allow representing the whole world through a limited number of representatives, while within the frames of representatives' powers the unions and coalitions would have an opportunity for better understanding of their common interests. Even such a dialogue in itself could be useful. The stability of new geopolitical and geoeconomic forms will depend on numerous factors. However, historical experience shows the most stable ones to be those with not only particular advantages and objective necessity, but also with certain non-political bases for uniting (i.e. geographical, cultural, economic, ideological etc.). As regards the particular reasons for the convergence of certain societies, it should be taken into account that in the condition of a certain bifurcation which the world is currently going through, new lines and vectors contributing to the countries uniting into supranational establishments, unions, groups, blocs and clusters depend on a variety of reasons, among which a certain feature of proximity may turn out to be critical. Beside geographical proximity, economic relations and common political (geopolitical) interests, the proximity of culture and mentality (i.e. civilizational affinity and similarity) can be the strongest in many cases. These political, cultural, and religious specific features may lead to the creation of some special regional or even interregional supranational approximation models (see above mention example with Chilean political scientist Talavera [2002]). Naturally, the movement towards the new world order will proceed at different levels. The regional level is very important. Regional leaders
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gather power very quickly; consequently, they will probably play a more significant role than now. Besides, some regional states will start playing the key role in the whole geopolitical disposition in huge territories. Nowadays, according to some opinions, Iran is starting to play such a key role (see, e.g., Bykov et al. 2009: 101102). The eminent role of regional states will be revealed not only in geopolitical and geoeconomic aspects, but also, so to say, in geo-cultural aspect, which would be in no way less important than the first two.51 It is not improbable that, responding to the possible deficit of global governance, non-governmental actors will form networks concentrated on particular problems.52 However, neither the role of NGOs nor networks should be exaggerated. The main part in the formation of a new world order will most probably be played by states, while supranational unions of all formats and forms will be gathering strength. A coordination centre is desperately necessary, without which the net world will become an uncontrolled conglomerate. Besides, there is a prevailing stereotype on the necessity of some global institutions, so they will be aspired to, more or less successfully. Thus, the question of the coordination-political center of the World System remains exceedingly important. If some collective political (coordination) center (with limited rights) could be created, the coexistence of other functional centers could become more possible and systemic, interactive.53 Namely states and especially supranational unions are most likely to be capable of moving towards the creation of such a center. Search for global answers to major problems will lead to various types of solutions at highest political level, from ones aimed at forming an order capable of functioning for decades (huge experience of the 20th century proves this to be quite possible) to a mass of non-systemic,
51
In Bernstein's (2002: 245) opinion, countries lying beyond the West and sufficiently powerful in economy, such as Japan (on the penetration of the Japanese mass culture into Asian countries see Aoki 2002), or in culture, such as India, are capable of influencing the global culture. 52 One could mention as examples of such networks the Financial Stability Forum, the Carbon Sequestration Leadership Forum, and the International Partnership for the Hydrogen Economy (National Intelligence Council 2008: 85). 53 Such a centre could rally the separate centers of the World Systems differing in their innovativity, industriality, financial capabilities, etc. Even though the rivalry between them would not disappear, it would become more productive.
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pragmatic, and palliative ones. However, even impulsive decisions allow starting the formation of a new system of decisions and institutions, coalitions and unions. On the other hand, the success of certain institutions will allow creating some projections on world restructuring. Thus, we are regarding a wide range of decisions, institutional and juristically formalized, aimed at systemic building of a new world; global, but for narrow problems, which, along with important but less global decisions will gradually be creating the outlines of a new world order. Thus, the future epoch will be an epoch of not only new coalitions, but also one of new global institutions, and new international technologies of multilateral (diplomatic, social, cultural) cooperation, on which much will depend. For example, the format of international congresses and multilateral agreements that originated after the Napoleonic Wars and reached its apogee in the 20th century is likely to be pressed by other formats which most probably will be based on modern communication technologies. Thus, some standing commission that work not at a bargaining table, but through the video conference format could become a convenient and rather cheap organ which could work permanently on solving certain problems. As Charles de Gaulle said, politics is too serious a matter to entrust politicians with it (Belmis 2009: 238). The same may be said about the diplomacy in the globalizing world. Thus, in 1525 years our world will be both similar to the present one and already substantially different from it. Global changes are forthcoming, but not all of them will take a distinct shape. Contrary to that, new contents may be covered by old outdated surfaces (as in the Late Middle Ages the emerging centralized state was not quite distinctly seen behind the traditional system of relationships between the crown, major seniors, and cities). One may say that these will be such changes that could prepare the world for the transition to a new phase of globalization (it will be very fortunate if there are grounds to call it the phase of sustainable globalization) whose contours are unclear yet.
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*** Though globalization has not started today, in general it is a new, unknown, most complicated and in many ways unpredictable process, which will create new problems in all spheres of life and require their solutions. One of the most important problem for a long time will be that of combining national and supranational, group and world interests. After all only an institutionalized solution of this huge problem will finally establish a more or less stable world order. Naturally it will take some time when there must occur a profound turn in the elites and peoples' outlook, and, as a result, the national problems will start to be considered primarily through the prism of common interests and only after that in the context of common (regional and world) tasks and problems.
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Complete Table of Contents

Introduction
. . . . . . . . . . . . . . . . . . . . . . . .
Part I. MACROHISTORY SURVEYS Chapter 1 Production Revolutions and Periodization of History: A Comparative and Theoretic-Mathematical Approach . . . . . . . . . . . . . . . . . . .
15 15 20 26 26 27 30 32 33 35 46 47 47 50 51 53
1. On historical process and the rules of periodization . . . 2. The production principles and production revolutions . . . 3. The elaboration of the periodization and development of historical process . . . . . . . . . . . . . . . . . . . 3.1. When does historical process start? . . . . . . . . 3.2. The first formations of historical process. The Hunter-Gatherer production principle . . . . . . . . 3.3. The second formation of historical process. The Craft-Agrarian production principle . . . . . . . . . 3.4. The third formation of historical process. The Industrial production principle . . . . . . . . . . . 3.5. The fourth formation of historical process. The Information-Scientific production principle . . . . . . 4. Mathematical interpretation of historical process . . . . . Chapter 2 The Role of an Individual in History: A Reconsideration . . . . . . . .
. . . . . . .
Section 1 . . . . . . . . . . . . . . . . . . . . . . 1. Views on the role of an individual in history up to the 18th century . . . . . . . . . . . . . . . . . . 2. The development of views on the role of an individual from the 18th to early 20th century . . . . . . . . . . . . . . . 2.1. The view on the individual as an instrument of historical law . . . . . . . . . . . . . . . . . . . . . . . . 2.2. Heroic, scientific, deterministic, middle and other views
Contents
317
3. Modern approaches to the problem of the role of an individual . . . . . . . . . . . . . . . . . . . . . . . .
59 66 66 66 69 71 72 73 73 74 77 79 83 83 88 91 93 96 98 105 116 123 129 132 134
Section 2 . . . . . . . . . . . . . . . . . . . . . . 1. General approaches . . . . . . . . . . . . . . . . . 1.1. Dialectic difficulties of the problem and the general scheme of the approach to its solution . . . . . . . . . . 1.2. On the typology of roles in history. Who can be considered an outstanding personality? . . . . . . . . . . . 1.3. Some factors changing the scale of historical personalities' influence . . . . . . . . . . . . . . . . 1.4. An individual and the masses. . . . . . . . . . . . 2. Factor and phase analysis . . . . . . . . . . . . . . . 2.1. The factor of situation . . . . . . . . . . . . . . 2.2. Some constituents of the factor of situation . . . . . . 2.3. Society's state phases . . . . . . . . . . . . . . 2.4. Modeling of change of the role of an individual in various phases of society states . . . . . . . . . . . . Chapter 3 The Evolution of Statehood
. . . . . . . . . . . .
1. The beginning of politogenesis . . . . . . . . . . . . . 2. About the views on the origin of state . . . . . . . . . . 3. On the typology of the Early States . . . . . . . . . . . 4. On the necessity of change in the concept of evolutionary stages of statehood. . . . . . . . . . . . . . . . . . . 5. Main differences of the Early, Developed, and Mature States 6. Early State . . . . . . . . . . . . . . . . . . . . . 7. Developed State . . . . . . . . . . . . . . . . . . . 8. Analogues of developed states and some notes on the World System political evolution . . . . . . . . . . . . . . . . 9. Mature State . . . . . . . . . . . . . . . . . . . . 10. Additional comparison between evolutionary types of state . 11. Mature state transformation in the 20th century . . . . . . 12. Concluding remarks . . . . . . . . . . . . . . . . .
318
Contents
Part II. GLOBALIZATION: ECONOMIC AND POLITICAL ASPECTS Chapter 4 Economic Aspects of Globalization
. . . . . . . .
136
Section 1. The Theory of Economic Cycles and Current Global Crisis . . . . . . . . . . . . . . . . . . . . . 136 1. On some approaches of economic science to the problem of cyclicity and economic crises . . . . . . . . . . . 137 2. General systemic model of crisis . . . . . . . . . . 146 3. On some important specific features of cyclical economic crises . . . . . . . . . . . . . . . . . . . . . . . 152 4. A verbal model of the J-cycle . . . . . . . . . . . 157 5. Recovery phase . . . . . . . . . . . . . . . . . 161 6. Upswing phase . . . . . . . . . . . . . . . . . 164 7. Overheating sub-phase . . . . . . . . . . . . . . 167 8. Recession phase . . . . . . . . . . . . . . . . . 174 9. Depression phase . . . . . . . . . . . . . . . . 181 10. On the importance of further research of the theory of J-cycles . . . . . . . . . . . . . . . . . . . . . 183 Section 2. The Global Financial System: Pros and Cons . . . 1. Global causes of the global crisis . . . . . . . . . 2. Why have classical features of previous economic crises been manifested in the current crisis? . . . . . . 3. Financial speculation: does it have a positive side? . . 4. Financial currents as the world pension fund? . . . . 5. Feeling of the necessity of changes . . . . . . . . . Chapter 5 Political Aspects of Globalization
. . . . . . . . .
185 186 188 191 194 203 207
Section 1. Why do States Lose their Sovereignty in the Age of Globalization? . . . . . . . . . . . . . . . . . . . . 207 1. Why is the notion of sovereignty difficult and ambiguous? . . . . . . . . . . . . . . . . . . . . . . 208
Contents
319
2. Globalization, economy, and world policy . . 3. Globalization and reducing sovereignty . . . 4. Reducing sovereignty and nationalism . . . . 5. Different issues of national sovereignty change
. . . . . . . . . . . . . . . .
211 216 224 226
Section 2. On the Way to Global Society: The Coming Epoch of New Coalitions . . . . . . . . . . . . . . . . . . . 231
1. Arab Spring as a precursor of the world reconfiguration? . . . . . . . . . . . . . . . . . . . . . 2. Change of leadership or a fundamental system modification? . . . . . . . . . . . . . . . . . . . . 3. Hypothetical and real alternatives . . . . . . . . . 4. Will the deficit of global governance and world fragmentation increase? . . . . . . . . . . . . . . . . . . 5. The epoch of new coalitions and sovereignty transformation . . . . . . . . . . . . . . . . . . . . . References
. . . . .
231 235 242 248 250 259
. . . . . . . . . . . . . . . . . . . . . . . . .
UCHITEL PUBLISHING HOUSE PRESENTS JOURNAL OF GLOBALIZATION STUDIES

ISSN 2075-8103 Frequency: Biannual. Published since 2010 The Journal is published in association with the Faculty of Global Processes of Lomonosov Moscow State University Editors: Leonid Grinin (Russia); Andrey Korotayev (Russia); Victor de Munck (USA); James Sheffield (New Zealand). Editorial Board: Christopher Chase-Dunn (USA), Alexander Chumakov (Russia), Randall Collins (USA), Georgi Derluguian (USA), William C. Gay (USA), Ioanna Kuuradi (Turkey), Gerald Mazarire (Republic of Zimbabwe), Janet McIntyre-Mills (Australia), Jack Meek (USA), Arno Tausch (Austria), Vladimir Shubin (Russia), Ian Yeoman (New Zealand). Journal of Globalization Studies (JGS) is a new international journal distinguished by its focus on the systemic aspects of globalization processes in particular geographic, social, cultural and historical contexts. Its themes include, but are not limited to, the following: global studies: urgent questions of philosophy and theory of history; theory of globalization and philosophical aspects of globalization; processes of globalization in history; economic, scientific-technical, social, political, ecological, cultural, ethical, religious and other aspects of globalization; formal models of globalization processes; futurological aspects of global studies; global dynamic forecasts etc.; global problems of modernity; global economic crises; impact of electronic media on globalization. JGS provides a multi-faceted analysis of globalization, based on perspectives of authors working in both Western and non-Western traditions. The special character of JGS is that it provides for a broadly international and multicultural forum on issues associated with globalization, and the influence of globalization in particular cultural-geographic regions. The journal invites all the students of globalization to enrich the discussion by presenting their own perspectives. Journal of Globalization Studies calls for papers for general issues. For the detailed guidelines, please, contact Editors: Prof. Leonid E. Grinin lgrinin@ mail.ru; Prof. James Sheffield jim.sheffield@vuw.ac.nz; Prof. Andrey V. Korotayev akorotayev@gmail.com; Prof. Victor de Munck demunckv@ gmail.com. For more information about the journal, please, visit its homepage at www.socionauki.ru

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LOMONOSOV MOSCOW STATE UNIVERSITY Faculty of Global Processes RUSSIAN ACADEMY OF SCIENCES

INSTITUTE OF ORIENTAL STUDIES

MACROHISTORY AND GLOBALIZATION

Uchitel Publishing House Volgograd 2011

207 231 259 316

References . . . . . . . Complete Table of Contents

Leonid Grinin. Macrohistory and Globalization

Leonid Grinin. Macrohistory and Globalization

Leonid Grinin. Macrohistory and Globalization

The chapter has been written in cooperation with Andrey Korotayev.

Leonid Grinin. Macrohistory and Globalization

Leonid Grinin. Macrohistory and Globalization

Part I MACROHISTORY SURVEYS

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Leonid Grinin. Macrohistory and Globalization

1929 1955 0.025 2105 2115 (2080 2090) 0.01

Chapter 1. Production Revolutions and Periodization of History

1.0 0.04 0.01 0.015

0.6 0.025 0.01

9.4 0.525 0.135 0.160

0.025 0.015 0.03 0.02

Leonid Grinin. Macrohistory and Globalization

Chapter 1. Production Revolutions and Periodization of History

Phase III Phase II

Leonid Grinin. Macrohistory and Globalization Diagram 2. Craft-Agrarian production principle

Phase III Phase II

8000 BCE (100 00 B P)

Diagram 3. Industrial production principle

1730 Phase II 1600

1490 1520 1550

1580 1610 1640

1700 1730 1760

1820 1850 1880

1940 1970 2000

Formation III (industrial production principle)

Formation II (craft-agrarian production principle) Formation I (hunter-gatherer production principle)

1500 5300 8000 10500 12000 3000

2000 1800 1600 1400 1200 1000

8 000 1430 CE BCE

Chapter 1. Production Revolutions and Periodization of History

Chapter 2 The Role of an Individual in History: A Reconsideration

Chapter 2. The Role of an Individual in History: A Reconsideration 47

See, e.g., Tacitus, The Annals, VI, 22.