The network of self-centered ties woven in the world since the industrial revolution has exhausted its potential and led humanity into a global economic crisis...
The economic crisis is arousing anxiety among economists and decision-makers throughout the world...
When analyzing the causes of the crisis, it appears that the existing economic paradigms no longer suit the global reality of our lives. While the old thought patterns that have dominated the world for more than a hundred years seem significantly lacking, new thought patterns that match the current reality and would help cope with the crisis are simply nonexistent...
In studying living organisms, the scientist first simplifies and explains how the various organs function, then explains about the different systems and their interrelations, thus performing analysis and synthesis...
The purpose of every theory is to simplify reality, and theories in economics are no exception. However, every researcher knows that perfect congruence between theory and practice is seldom found. The current economic theory assumes that each person wishes to maximize his or her personal benefit, and describes a system of relations between consumers, manufacturers, firms, and countries according to that premise...
Economics uses statistical tools that allow for isolation of variables to detect which connections repeat themselves, and under what conditions. Using these statistical tools, researchers learn from past events and build models of behavior over time. They can use these mathematical tools because it is possible to quantify the various parameters. However, what happens when the models need to include unquantifiable parameters? Human behavior is just such a parameter, and because economics relates directly to human behavior, it renders the entire field of study limited and inexact...
Thus far, the economic theory has managed to characterize the behavior of economic units on the level of particular units, as well as on the general level. However, the theory worked only as long as units could be looked at as particular elements...
The current economic paradigm that led us into this crisis created—among other ills—a legal and moral foundation to exploit cheap labor, primarily in East Asia, and to over-consume our natural resources. That foundation has led to mutual dependence from which we can no longer escape. The U.S., for instance, has become a superpower of financial services and consumption. China, on the other hand, as well as India and other developing nations, have become the world’s factories. The global system is more connected than ever, and economists must build an economic paradigm that supports that mutual dependence...
To demonstrate the connection between the laws of the global-integral system and our ability to identify its characteristics we must turn to other fields of science...
The vast gap between the global-integral reality to which the human society has evolved, and the current economic paradigms, which have not significantly changed since the industrial revolution, is the real reason for the crisis. Understanding the gap is the first step toward solving the crisis, and this is the great challenge that economists face today...
The existing systems cannot be discarded offhandedly. We have a major challenge ahead of us that entails a profound change of perception on our part...