Solar Activity and Perturbations in Economy and Society

 

 

Theoretical claims

 

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William Stanley Jevons (1835-1882), English economist and logician:

 

Major “commercial crises” occur with intervals broadly matching solar cycle length, a “beautiful coincidence”.  Read more

 

ch1_1 - chizhevsky

Alexander Chizhevsky (1897-1964), Russian interdisciplinary scientist:

 

Up to 60 percent of revolutions and other “most important historical events involving large numbers of people” occur in three years around and after cyclical maximums of solar activity.   Read more

 

 

Solar Activity and Economic Recessions

 

Fact: Out of 22 recessions in the US economy identified by the National Bureau of Economic Research (NBER) in 1901-2008, in the years corresponding to solar cycles numbered by astronomers from 14 to 23, eleven recessions began in two years around and after maximum points of those cycles. Moreover, out of 13 of those recessions that began in 1933-2008 (solar cycles 17 to 23), eight – over 60 percent – began in two years around and after solar maximums.

 

 

Fact: Out of 36 recessions in G7 countries identified by NBER and The Economic Cycle Research Institute (ECRI) in 1965-2008 (solar cycles 20 to 23), 21 – nearly 60 percent – began in 3 years around and after solar maximums.

 

 

Solar Activity and Unemployment

 

Fact: Each of eight solar maximums in 1929-2008 overlapped closely with low points in the US unemployment rate followed by its sharp increase.

 

 

Fact: Each of five solar maximums in 1956-2008 overlapped closely with low points in the aggregate unemployment rate in the G7 countries followed by its sharp increase.

 

 

Solar Activity and Revolutions

 

Fact: Two most important revolutionary events of the XX century – the Russian revolution of 1917 that brought communists to power and USSR collapse in 1991 – occurred in the years of maximum solar activity.

 

 

Years

Events

1905-07

Revolution of 1905-07 in the Russian Empire

1917

1918

February Revolution, Great October Socialist Revolution in Russia

Revolutions in Germany, Hungary, collapse of Austro-Hungarian Empire

1936

Revolution in Spain

1946-49

Conversion of Eastern Europe to socialism

1956

Hungarian Revolution, Poznań protests in Poland

1968

1970

“Prague Spring” in Czechoslovakia

Protests in Poland

1980-81

Polish crisis, emergence of “Solidarity”, martial law in Poland

1989

1991

Fall of Berlin Wall, collapse of communism in Eastern Europe

Collapse of Soviet Union and Yugoslavia

 

Fact: Out of 21 solar maximums in 1785-2014, 16 associated with most important revolutions that shaped the human history.

 

 

Years

Events

1789

Great French Revolution

1830

Revolutions in Europe (France, Poland, Germany, Italy, Greece)

1848

Revolutions in Europe (Italy, France, Germany, Austria, etc.)

1861

Secession by the 13 southern US states that formed the C.S.A.

1871

Uprising in Paris, “Paris Commune”

1905-07

Revolution of 1905-07 in the Russian Empire

1917

1918

February Revolution, Great October Socialist Revolution in Russia

Revolutions in Germany and Hungary, collapse of Austro-Hungarian Empire

1927

Revolution in Mexico

1936

Revolution in Spain

1947

1949

Independence and violent partition of India

Revolution in China

1957-59

1960

Revolution in Cuba

“Year of Africa”: 17 countries gained independence

1968

Student protests, general strikes in Europe and in Mexico

1979

Islamic Revolution in Iran

1989

1991

Fall of Berlin Wall, collapse of communism in Eastern Europe

Collapse of Soviet Union and Yugoslavia

2001

Rise of al-Qaeda, terrorist attack on the U.S. on September 11

2010-13

2013-14

“Arab Spring”: Revolutions in Egypt, Libya, Syria, Yemen, Tunisia

Revolution in Ukraine

 

Fact: The currently unfolding solar cycle 24 went through an unusual double maximum, with solar activity peaking in late 2011 and then reaching its cyclical maximum in early 2014. The 2011 peak overlapped with the chain of revolutions in the Arab countries dubbed “Arab Spring”. The solar maximum in the early 2014 overlapped with revolution in Ukraine.

 

Fact: Refugee inflows in the EU countries followed solar cycle pattern in 1985-2015.

 

 

Are these facts an interesting coincidence or part of a broad pattern?

 

Solar Activity and Current Developments

 

Economic conditions in the U.S. and G7 countries deteriorated in 2015, consistent with the historical pattern. Composite leading indicators (CLIs) designed by the OECD to give early signals of turning points in the business cycle deteriorated for the U.S., for the G7 countries (read more), and for the entire OECD.

 

 

 

 

But no US recession? A pattern observed for over 100 years suggests elevated chances of U.S. recession starting in 2014-15, which has not happened (yet).

 

And no reversal in the U.S. unemployment trend? The historical pattern points to possibility that the declining trend in the U.S. unemployment rate would bottom out and reverse in 2014-15, which has not occurred (yet).

 

 

In both cases, U.S. Fed’s highly accommodative monetary policy targeted at supporting economic recovery and boosting employment can explain the deviation from the historical pattern. Never before the U.S. Federal Funds rate remained virtually zero for so long even as the economy expanded and unemployment rate declined to its lowest level since 2008.

 

 

Research papers and presentations

 

Can Solar Activity Influence the Occurrence of Economic Recessions? (2015)

 

This paper revisits evidence of solar activity influence on economy. We examine whether economic recessions occur more often in the years around and after solar maximums. This research strand dates back to late XIX century writings of famous British economist William Stanley Jevons, who claimed that “commercial crises” occur with periodicity matching solar cycle length. Quite surprisingly, our results suggest that the hypothesis linking solar maximums and recessions is well anchored in data and cannot be easily rejected.

 

Also available from RePEc

 

 

Sunspots, unemployment, and recessions, or Can the solar activity cycle shape the business cycle? (2012)

 

Over the last 77 years (from 1935), all 7 cyclical maximums of the solar activity overlapped closely with the US recessions, thus predicting (or triggering?) 8 out of 13 recessions officially identified by NBER (including one “double-deep” recession). Over the last 64 years (from 1948), all 6 maximums of the solar activity were preceded by minimums of the US unemployment rate, and the spikes in the unemployment rate followed with lags of 2-3 years. On the world scale, over the last 44 years (for which the data is available), all 4 maximums of the solar activity overlapped with minimums of the unemployment rate in the G7 countries, followed by its spikes within 2-3 years. From 1965, when consistent recession dating is available for all G7 countries, nearly 3/5 of the recessions started in the 3 years around and after the sunspot maximums. Was it a mere coincidence or a part of a broader pattern? This paper explores the correlation between the solar activity cycles (as measured by the number of sunspots on the sun surface) and the timing of recessions in the US and other economies. It finds out that the probability of recessions in G7 countries greatly increased around and after the solar maximums, suggesting that they can cause deterioration in business conditions and trigger recessions. This opens new approach for projecting recessions, which can be applied and tested with regard to the next solar maximum in 2013.

 

Also available from RePEc

 

 

Can Solar Activity Influence the Occurrence of Economic Recessions? (2016)

 

Can solar activity influence the occurrence of recessions? (2015)

 

Sunspots, Unemployment, and Recessions, or Can the Solar Activity Cycle Cause the Business Cycle?  (2012)

 

 

Further research and literature references

 

 

Last update: January 2016