DEFINITION of Kondratiev Wave
A Kondratiev Wave is a long-term economic cycle believed to result from technological innovation and produce a long period of prosperity. This theory was founded by Nikolai D. Kondratiev (also spelled "Kondratieff"), a Communist Russia era economist who noticed agricultural commodity and copper prices experienced long-term cycles. Kondratiev believed that these cycles involved periods of evolution and self-correction.
Also known as "Kondratieff Wave," "supercycle," "K-Wave," "surge" or "long wave."
BREAKING DOWN Kondratiev Wave
Economists have identified five Kondratiev Waves since the 18th century. The first resulted from the invention of the steam engine and ran from 1780 to 1830. The second cycle arose because of the steel industry and the spread of railroads. It ran from 1830 to 1880. The third cycle resulted from electrification and innovation in the chemical industry, and ran from 1880 to 1930. The fourth cycle was fueled by autos and petrochemicals and lasted from 1930 to 1970. The fifth cycle was based on information technology and began in 1970 and has lasted to this day. Some economists believe we are at the start of a sixth wave and that this one will bring additional information technology innovation, but will be driven more by biotechnology and healthcare.
What Happened to Nikolai D. Kondratiev?
K-Waves are not widely accepted by economists, and the theory was also not welcomed in Kondratiev's Russia. His views were disliked by Communist officials because they suggested that capitalist nations were not on an inevitable path to destruction, but that they instead only experienced ups and downs. As a result of his seditious writings, Kondratiev was sentenced to serve time at a concentration camp in Siberia, but he was executed there in 1938.