Question

How does a Kondratiev wave relate to Colonial expansion?

Answer 1

A Kondratiev Wave is a long-term economic cycle result from technological innovation and produces a long period of prosperity. A Kondratiev Wave is a long-term economic cycle believed to result from technological innovation and produce a long period of prosperity. Kondratiev identified three phases in the cycle: expansion, stagnation, and recession. Kondratiev Wave focused on prices and interest rates, seeing the ascendant phase as characterized by an increase in prices and low interest rates, while the other phase consists of a decrease in prices and high interest rates. Colonial expansion indicates growth of new markets, new areas for the settlement. Colonial expansion refers the system of production and consumption in the colonies by the colonialist in order to fulfill their economic demands such as raw materials, markets, area for investment and areas for settlement. The outcome of these colonies was never intended, culture development. This led to large trade enterprises and economical benefits for colonial powers. Kondratiev Wave influence the long wave dynamics on the changes of the world GDP growth rates by helping in the generation of colonial markets for goods, raw materials, fuel, industrial expansion, exportation of precious metals, spices, and luxury items etc. K-waves are quite visible in the world dynamics of such important macroeconomic variables as the world gross fixed capital formation and the investment effectiveness.