What Causes Booms?

This paper was presented to the joint conference of the AFEP, AHE and IIPPE in Paris, July 2012. A more developed and substantially revised version was presented to the conference on ‘Marxism: Marx and Beyond’ in Calcutta, 22-24 March 2012 and is due to be published. The paper argues that booms, not depressions, are the exception in capitalist history; this inverts the general approach of economics. I argue that booms are recurrent, but irregular events that arise when certain specific sets of political and economic conditions are met. If we can establish these conditions this will help understand what booms can achieve, what their dangers are, and whether their historical potential is exhausted, shedding light on such intractable problems in political economy as what causes growth, whether it is desirable, what circumstances bring about economic development, and what causes so-called depressions JEL Codes: B1, B14, B3, B5 Keywords: Crisis, Rate of Profit, TSSI, Marxis