A. Erinç Yeldan Bilkent University and IDEAs Capitalism into the 21st Century: Segmentation and fragmentation of labour markets A. Erinç Yeldan Bilkent University and IDEAs

Fordist technology and management: mass production for mass consumption

Two important attributes of the era of hyper-globalization: Hyper-liquidity of (finance) capital The new international division of labor (based on global commodity chains)

Productivity growth and wages under the Taylorist / Fordist Era of Capitalism

OECD data confirm historical trends

Looking over to the 21st century

Observations on the pathways of capitalism in the 21st century World economy is on a slowing trend Nature of growth tends to switch from jobless growth to wageless growth Tendencies of concentration and monopolization in the global commodity and services markets Industry’s share in production and employment tend to decline (de-industrialization)

Projections of growth for the global economy: 2000-2060

Unequal distribution of income leads to declining rate of growth globally….

Threat of climate change affects growth adversely…

Sources: Unctad, Trade and Development Report, 2018 and ILO, 2018

Global Labour Markets: Unemployment and Vulnerability

Source: IMF Statistics

“The growing economic wealth and power of big companies—from airlines to pharmaceuticals to high-tech companies—has raised concerns about too much concentration and market power in the hands of too few. In particular, in advanced economies, rising corporate market power has been blamed for low investment despite rising corporate profits, declining business dynamism, weak productivity, and a falling share of income paid to workers”.   “The Rise of Corporate Giants” F. Diez ve D. Leigh https://blogs.imf.org

In fact The largest 2,000 trans-national corporations have sales revenues exceeding the annual volume of global trade

Mark-ups (profits over costs) expand disproportionally in the advanced / developed countries

Increased profitability did not accompany increased fixed investments…

Source: Robert Gordon (2016) The Rise and Fall of American Growth, Princeton University Press.

The US Economy is on a declining trend…

Vicious cycle of global capitalism

OECD, (2014): 2060 Policy Challenges for the Next 50 Years” OECD Economic Policy Paper, July No 9.  Average annual rate of growth of the World will fall from 3.6% in 2014-2030 to 2.7% over 2030-2060; Within the advanced developed economies of the OECD, rate of growth will fall from 2.4% in 2014-2030 to 0.5% in 2030-2060   Emissions of green house gases due to industrial processes and burning of fossil fuels will rise two-folds from 48,700 million tons annually to 99,500 mtons in 2060. As a result of these adverse developments, the threat of climate change will reduce the rate of growth in the Asian economies by 1.5% to 5%. Sources of growth will increasingly rely on R&D gains rather than accumulation of phsyical capital. Gaps between knowledge-intensive human capital and physical power will widen As a result unequal distribution of incomes will widen ocver 2014-2060 and will lead to social exclusion and social tensions

Monetary Policy has proven ineffective

Source: Wolff and Resnick, 2006, Advances in Marxist Theory