Long-Wave Rhythms in Economic Development and Political Behavior.

• Author: Schaniel, William C.

By Brian J. L. Berry. Baltimore and London: The John Hopkins Press, 1991. Pp. xiv, 242.

The value of this book depends heavily on the interests of the reader. The book can be approached in several different ways: a summary of long-wave theories; as an application of chaos theory to economics; as a merging of long-wave theories; as a new attempt to interrelate economic, social and political events; or as a challenge to conventional economic wisdom. The interplay and skilled weaving of these various themes along with Professor Berry's clear and engaging writing style make this book eminently readable. Despite these strengths in style, the method and arguments fail to convince this reader of the validity of his long-wave theory of economic and political behavior.

The first chapter opens with the question of the appropriate tools to be used in analyzing and presenting evidence for long-waves in economic variables. Chaos theory is the main tool employed in the book to analyze data for long wave propensities. Chaos theory contends that the relationships between variables can change as the variables themselves change, resulting in seemingly random, or chaotic, behavior by the variables. Chaos theory does not rely on new mathematical techniques, but instead is based on analysis of data patterns developed using conventional techniques. The seemingly random data of a chaotic system will often reveal itself by operating around a strange attractor, that is a point of collection of points around which the variables will oscillate. In this exposition on long-wave theory, as with previous long wave theory presentations, the argument relies on the use of smoothed data to show the long term trends. Professor Berry notes Slutzky's argument that a moving average applied to random numbers can create cyclical fluctuations where none existed. In reply, the author argues that by using chaos theory the critique is no longer valid because ". . . a chaotic system lies somewhere between one that is perfectly periodic and one that is a random walk" [p. 14]. While this conclusion could be valid, the data set he employs to analyze by long-wave economic activity is not appropriate to chaos theory. Professor Berry chooses to use moving averages to "smooth out the year-to-year oscillations" [p. 12], or eliminate the behavior in the annual data he cannot explain. This elimination of "year-to-year oscillations" eliminates seemingly random variations that chaos theory...