Business Activity in Cyclic Development of Economy and Stages in Investment Value Specialization

Abstract

On the basis of system approach the article analyzes the development of economic system during movement of investment values (jobs) and human capital by stages of their specification. Economic cycles were discussed briefly and each of them finishes in the late first quarter of the 21st century. With the help of exchange equation the author shows economic investment cycles and stock cycles as a result of business activity aimedatresolvingproblemscreatedbygrowingnumberofhumancapitalanditsdemandforvaluesofcomfortablelife. Cycles of staff business activity were studied, which constantly take the economic system to new stages of investment value specialization. Controversial results of business activity were highlighted, which can cause either a recession of the economic system or galloping inflation. An important role of inflation in managing business activity and developing economic system was underlined. The article identifies the conditions when the poor become poorer and the rich – richer. Special attention was paid to problems that could arise in economic systems in case the sequence in staff business activity is broken.

Keywords

• jobs
• human capital
• labour productivity
• business activity
• exchange equation
• aggregate demand
• economic cycles
• inflation
• deflation