Carlota Perez may be the most significant proponent of long-wave theory, an approach classically associated with Nikolai Kondratiev and his 50-year cycles of boom and bust, and Joseph Schumpeter and this view of creative destruction that he saw as essential in these cycles. According to Perez, the world is due for a technological and economic boom that makes everyone better off, but it’s up to us to make it happen. This article consists of an interview by Art Kleiner with Perez, whose book, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages, came out in 2002.

Perez developed an interest in the link between technological and financial cycles. She developed a model in which change begins in a 20 or 30 year period which she calls Installation. In this stage a new generation of technologies is ready to emerge into widespread use but needs the force investment capital to give it momentum. Installation is followed by another 20- to 30-year period called Deployment, when the potential of those technologies for improving quality of life comes to fruition.

In the interview, Kleiner asks Perez about five previous technological revolutions since the late 18th century, each lasting 45 to 60 years. The current, fifth, surge is the age of information technology and telecommunications. It began in 1971 with Intel’s microprocessor and should continue for another 20 to 30 years. Perez expects the next wave will be driven by biotechnology, bioelectronics, nanotechnology, and new materials. She explains how differ the fifth age differs from the age of oil, both in terms of its effects on the economy and on the most effective structure for organizations.