Simon Kuznets’s Happy Prognosis Crushed in an Ideological Coup

In 1955, economist Simon Kuznets suggested that, while inequality increases during early economic development, in later stages it declines. However, this felicitous hypothesis has been contradicted by inequality’s explosion since the 1970s. This explosion was energized by President Ronald Reagan’s declaration in 1981 that “government is the problem.” Turning popular sentiment against government was an ideological coup, because only government policies can decrease inequality. Government was not reduced in size or in its intervention into the workings of the economy, but policies shifted radically in favor of the wealthy. Taxes were cut for the rich, the economy was significantly deregulated, and welfare measures were trimmed. This chapter unfolds the dynamics that enabled laissez-faire ideology to revive and become more entrenched than ever before. It clarifies how this ideology managed to survive the Great Recession following the financial crisis of 2008, during and after which inequality has continued to explode.

ПРИНЦИПИ ПРОЕКТУВАННЯ ЛЮДИНО-МАШИННОЇ ВЗАЄМОДІЇ У ЦИФРОВОМУ СЕРЕДОВИЩІ

Modern society life is inextricably linked with the digital environment. A consequence is the transformation of ergatic systems into digital ones. The result is the emergence of new types of man-machine interaction. The essential feature of such interaction is to minimise human involvement in the ergatic system functioning. According to this, the issues of organising the safe and effective functioning of digital ergatic systems have priority importance. In this regard, the aim was to study the features of man-machine interaction in an actual digital ergatic system. We chose an ergatic system for research. The main elements of the system were students (70 people of the first-year study) and teachers (5 people) of the Simon Kuznets Kharkiv National University of Economics, as well as the digital system “Personal training systems the Simon Kuznets Kharkiv National University of Economics” (PTS). This digital system is an adapted model of the Moodle digital system. The study found out that the key components that determine the safety and efficiency of the digital ergatic system are the operator's digital mindset, digital tools and digital devices. The study of these components in the system made it possible to establish that it had a balanced state. It is substantiated the optimal form of man-machine interaction in the system. It is mixed learning. It is shown that the tendency to minimise the human role in a digital ergatic system does not always have the expected positive result, which determines the need for further research on this issue. In addition, we analysed the difficulties arising in the design of digital systems. The main reason for this is a lack of developers awareness of the ergonomic and cognitive aspects of man-machine interaction. It is shown that the development of critical thinking and intuition in students is closely related to the individual trajectory of learning. For this, it is essential to update interdisciplinary knowledge. In this case, it is necessary to familiarise students with current concepts and system-forming principles, which are the basis of human factors engineering. It was substantiated that the application of current concepts and system-forming principles in training will allow optimising man-machine interaction. The positive results will be evidence even at the stage of designing digital systems

Alteration of Consumption Habits in Turkey Over Time

Simon Kuznets and John Maynard Keynes did research on the subject of propensity to consume. Kuznets asserted that people do not alter their consumption/saving ratio and spend more when they have more disposable income. Keynes alleged that when disposable income increases, the rate of saving also increases over time because people tend to keep their consumption habits steady. Namely, the consumption/saving ratio of households or individuals tends to decrease as disposable income goes up. And in this study, the Keynesian consumption function is investigated in the Turkish economy. The result of this research might give insight into the future of the consumption/saving ratio in Turkey. In the study, the ARDL econometric model is operated with data from the Turkish Statistical Institute. The result of the study is that people change their consumption habits with the increase of disposable income. As a result, the consumption level has been slowing down, and the propensity to consume diminishes. That proves that the Keynesian consumption function holds in Turkey.

¿Smith o Kuznets en Argentina? La matriz laboral durante la primera globalización (1870-1914)

In the classic theory about the evolution of economies in the long term, Adam Smith and Simon Kuznets proposed two contrasting theories about the evolution of the labor market in a period of economic growth. Smith proposed a growth in the labor markets guided by the more dynamic and productive sectors through a process of specialization led by the insertion in international commerce. Kuznets, instead, theorizes that the growing modern economies generate changes and diversification on the labor markets towards secondary and tertiary sectors and on the skills stock of the labor force. With that in mind, this work presents an analysis of the labor structure in Argentina during the first globalization period (1870-1914) through a classification of workers and the economic active population divided by sectors and skills, using the occupational compilation of the national census of 1869, 1895 and 1914. The main results show that, despite the high growth of the economy during the first part of the studied period (1870-1895), Argentina did not show high changes in the labor structure at an inter-sectoral level. However, the growth of the economy, especially after 1890, involved a series of transformations on the labor markets that modified their composition and the intensity of skills by the labor force.

A Relevância da Obra de Simon Kuznets para o Debate sobre Distribuição de Renda desde o Pós-Segunda Guerra

O objetivo do artigo é tomar como referência a obra de Simon Kuznets para descrever aspectos importantes do debate sobre desigualdade econômica e distribuição de renda nos países desenvolvidos desde 1945. A primeira seção, baseada em Kuznets (1955), expõe seu modelo com simulações dos efeitos de mudanças de estrutura produtiva e de emprego sobre o perfil distributivo. A segunda apresenta o debate sobre distribuição de renda após 1980, quando ocorre a “reversão” da Curva de Kuznets. Na terceira, destaca-se o “debate do 1% mais rico”, que incorpora aspectos políticos para compreender a recente expansão da desigualdade nas economias desenvolvidas no século XXI. As conclusões apontam a relevância e atualidade de sua obra para o debate sobre distribuição de renda e desigualdade econômica.

Structural Transformation and Income Distribution

This chapter explores the question of structural transformation and income distribution through the eyes of the pioneer in such analysis, Simon Kuznets. It argues that his 1955 paper stands the test of time in providing insights which are relevant to understanding current phenomena such as the evolution of Chinese inequality. The chapter shows how the Kuznetsian framework can be used, for example, in predicting the differential relationship between urbanization and inequality in India versus China, in assessing the detail of the contribution of sectoral mean and inequality evolution to overall inequality change, and in linking the recent inequality of opportunity literature to rural–urban migration. Thus the original Kuznets framework has the seeds of getting us beyond Kuznets as sometimes (mis)understood in the literature on structural transformation and income distribution.

Egyenlőtlenség és gazdaság: hogyan hatnak egymásra?

A társadalmi egyenlőtlenség számos módon tud hatni egy ország gazdaságára, például az iskolázottságon, az egészségen, vagy a fogyasztási és megtakarítási szokásokon keresztül. Ezek a mechanizmusok sok – de nem minden – esetben az egyenlőtlenség káros hatásairamutatnak rá. A gazdaság is hatással van a társadalmi egyenlőtlenségre, a kapcsolat tehát komplex és nem egyirányú. Az összefüggés részletes adatokon alapuló megértésére elő-ször a későbbi Nobel-díjas Simon Kuznets tett kísérletet. Mindenesetre a nevéhez köthető görbét – miszerint a gazdaság növekedésével párhuzamosan először az egyenlőtlenség is növekedik, majd csak később mérséklődik – mára meghaladottnak tartják, az elmúlt évekkutatásai ugyanis többféle fejlődési pálya meglétére engednek következtetni. 2 A pénzügyi válság és az egyenlőtlenség elmúlt évtizedekben érzékelt változásai nemcsak magára az egyenlőtlenség kérdésére irányították rá a figyelmet, hanem a közgazdasági modellek ezzel kapcsolatos hiányosságaira is. A gazdaság és az egyenlőtlenség kapcsolatának vizsgálatán túl, így jelen cikk szót ejt a jövedelmi/ vagyoni eloszlás makroökonómiában betöltött szerepéről is.

Development as take-off, 1950–75

As a student, Walt Whitman Rostow resolved to write a riposte to Marxism. After studying British economic history, he identified a period of thirty years of rapid development as the core of an industrial revolution, which he thought was characteristic of all subsequent industrial revolutions. He used this idea of a take-off period to forecast future revolutions in developing countries that would lead to an American-style consumerist society. After advising President Johnson on a strategy for the failed Vietnam war, he resumed his academic career in the face of much criticism of his theory. Alternative interpretations of the British experience was offered by Simon Kuznets, and of the Continental experience by Alexander Gerschenkron, while Raul Prebisch and Latin American colleagues produced the radically different dependency approach to explain the underdevelopment of that region.