Psychoeconomics: globalization, markets, crisis

Summary of the Chapter

The economic and historical development of mankind is not only an accumulation of material assets, but also a change in people’s culture. One of the most important moments of these changes is the change in the system of dynamic stereotypes, the psychotypes of a population, in the economically active population, the elites. These changes are regular, and related to the degree of psychological and social compatibility of the different psychotypes in the course of life of several generations. The most unfavorable outcome, post-postresonators in the elite and the economically active population, leads to psychoeconomic crises of special depth. The majority of the world’s countries are now living through this crisis.

References

Reich, Robert B. Aftershock: The Economy of the Future. Moscow, Career Press. 2012, p.193.

Konyukhov, N.I., Arkhipova, O.N., Konyukhova, E.N. Pyschoeconomics. 2nd edition. Мoscow, 2012. 540p.

Chapter 3. Globalization as a process of synchronizing the psychoeconomic changes in the world

It is important to evaluate the measures any country takes to optimize economic and social development against the processes on which the effectiveness of those measures depends. This above all means understanding the place of a given country in the international division of labor and the effect of globalization on the country’s development.

Globalization is a fact of life in the modern world, and involves the synchronization of many economic, social, psychological, technological and other factors. This introduces qualitative changes in the development of the contemporary world, including psychoeconomic events.

3.1 Synchronization of psychoeconomic phenomena in the contemporary world and its reflection in economic indicators

Carl Jung expressed an unusual idea for his time, namely that the psychotype, or drives that oppose conscious drives, forms within the unconscious. But over time, the unconscious and the conscious exchange places. Subsequent research has shown that this idea needs some restatement, namely, that drives form in the unconscious that are opposed to conscious drives, especially if the conscious drives are not reliable. Yes, that’s how we’re arranged.

Our unconscious senses the incorrectness, the imprecision, the one-sidedness of the conclusions reached by consciousness, and it builds up a need to make these conclusions precise, including by denying their opposite. In its own way, this mechanism is rational, and at times it is astonishing in its precision, prognostic ability, and accuracy. The fact is, our consciousness is single-plane and factorial. By and large the determinants of socioeconomic development have a heterogeneous, multifactorial, and cumulative nature. Some microfactors have a tendency to escalate into factorial, leading causes, so it is periodically necessary to change opinions, outlooks, and mindsets. This change is cyclical and tied closely to solar activity. The mechanism that opens and closes nerve cells works better precisely at times of increased solar activity, and this is valid for everyone. Therefore, during periods of economic globalization we also get harmonic curves of change across very different economic indicators.

In a period of increased solar activity, human thought and the thoughts of market players change more often. At times, this takes the form of projection in regard to understanding the factors of economic development, while at others, it takes the form of a sharp shift in management decisions, namely those that can affect the condition of the market.

Therefore it is not accidental that the rate of change in the value of a market basket of consumer goods rises and falls or that the price of housing relative to the price of gold grows then declines, etc. At some point, it becomes clear that the value of the market basket is such that you have to produce more goods from this basket and to obtain higher than average profit in market terms. But as time passes, it turns out that the normal profit for production of goods from the basket of consumer goods has dropped below a psychologically justified level. Once more the opinion forms that it is better to obtain a profit in the financial sphere, in the stock market, in the area of trade etc. All of this is established based on economic calculations… However, before the beginning of high solar activity, less attention is at times paid to this, in view of the rigidity of reasoning and inadequately active functioning of the open-close mechanism of nervous impulses.

There are other periods of pendulous swings of opinion among the agents of economic activity. These periods are smaller than the period between the peaks of solar radiation. Large, global periods of change in opinion co-exist with the oscillating change of opinion for minimal time intervals – months, weeks, days, hours, minutes… The more indefinite the condition of the market, the smaller the time intervals in which changing occurs from one type of decision to the opposite one.

What do we make of this? This is indeed what actually happens on the world market, in the stock market, in the world economy. Our economic drives are realized in hundreds or thousands or even millions of buying and selling transactions. So as a result these economic decisions of the mass of individuals and companies become sinusoidal, cyclical… First one factor (or a group of factors of the same type) becomes absolute when decisions are made, then another one does.

And this is not only in the economy. Fashion, science, and art function the same way. At points of high solar activity we become more inclined to change our position and our opinions. And we change them toward the relative opposites. Everything is according to the laws of the relationship of the conscious and unconscious, according to Jung. That’s how we’re built. This is a deeply reinforcing device that compels us to understand the truth even in spite of our will, by directing our consciousness toward one factor, then to its opposite.

Gradually, after we have sorted out these factors, we obtain a more comprehensive picture of the market’s development, of socioeconomic processes, and of the world as a whole, getting closer and closer to the truth with each new historical stage of development. It is as though we are being compelled to acknowledge the truth, the necessary psychological prerequisites for this are being created.

Regarding the processes of economic globalization, in connection with the formation of a single market, these processes become more and more coordinated on a global scale.

Cyclically repeating economic dependencies reflect the intentions of the people making decisions. Thus, the relationship of the price of gold to securities reflects the relationship of the intentions of the domain experts and social motivators in deciding whether to buy stock or gold. At the same time, this is a relationship of the intentions of kinesthetic and auditory types, of people with a developed “total” or “partial” metaprogram, of those inclined toward metamodeling or Milton modeling, people with hysteroid traits (peak share price) versus paranoid traits (who tend to choose gold a little more often), etc. Moreover, each psychotype, each metaprogram that is present to one degree or another in the agents of economic activity, oscillates somewhat, but in the aggregate these micro changes, these “somewhat” give the effect of reconsideration of the decisions of market participants, which are flex points of price changes. These “negligible” oscillations by many over a certain time interval in their majority predetermine the market’s “U-turn”.

A hardly perceptible, and at times simply imperceptible change of the agents of economic activity in terms of all the metaprograms, accentuations, and psychotypes that have been examined before goes unnoticed by its participants. But in the aggregate, according to the degree of growth of these cumulative causes, we see the result, namely a change in the trendline. And only after this change has occurred does consciousness look around for the causes of this phenomenon.

And before it can reach extreme values, some psychological indicator (value, accentuation, personality trait, metaprogram, etc.) passes through an oscillatory correction, and sometimes a real change, in a specific person or in a group of people. That is, the swings exist within the cycles designated on the graph. They are universal. Behind these swings stands an oscillating change of consciousness and even the culture of the subject of economic activity in the widest sense of this word. That’s how people are constructed.