State Space Models

All state space models are written and estimated in the R programming language. The models are available here with instructions and R procedures for manipulating the models here here.

Sunday, July 26, 2026

INDIA: The New Axis of Evil and Hardship

 




In a prior posts (here and here), I looked at the Geopolitical Effects on Hardship as a result of India's "Cockroach" Protests and the possibility of a New Axis of Evil forming involving Russia, China and India. In this post, I'll explore the effects of potential alliances between China, Russia and India on Hardship in India.






Notes


HARD1 CN-RU-BAU-RW AIC STATISTICS

The best short-term model, using the AIC Statistics, is the Random Walk (RW). 

IN CN-INPUT HARD1 MODEL






Saturday, July 25, 2026

Hardship and Protest in India


India has had two decades of mass protest culminating in the 2026 Delhi Jantar Mantar protests or "Cockroach Protests". My questions are  (1) how much of the protests are a result of material conditions (Hardship) and (2) What possible response might the government consider in the face of discontent?

My Hardship Index (HARD1) for India has been increasing since the 1960s (see the graphic above). The Business-as-Usual forecast (BAU) suggests that, even though the model is stable (see below), Hardship will increase linearly until well after 2100--not a desirable outcome.

Linking India Geopolitically with the United States would result in a Hardship peak around 2040 and decline after that. Future increases in Hardship before the decline might or might not be sustainable politically.

Linking India Geopolitically to the World System keeps Hardship steady until after 2040 when it starts decreasing. This would be the best outcome but the most difficult to achieve politically (I will explore the difficulty of linking to the World System more fully in future posts).

Of course, India can keep muddling through, randomly responding to Protests (a Random Walk, RW) and hope that  protesters will retreat from the streets, pushing problems off into the future at the current level of Hardship. 

For more of my posts on India see Blog Roll: IndiaThe WL20 India Model in R-Code is available on my Google site. INL20 BAU is an example of a moving equilibrium model that can both easily be stabilized or destabilized. Also, see the About page and the Boiler Plate.



 Notes


INL20 Hardship Measurement Model





HARD1 =  (Growth - mortality and longterm unemployment ),  HARD2: Unemployment and poverty, HARD3 = Business cycle, Unemployment and reduction in CPI.  From the World Development Indicators.




INL20 HARD1 AIC STATISTICS


Best model is W-input.


INL20 HARD1 W-INPUT MODEL




The model is stable. Commodity Markets have the biggest negative impact on Hardship.

WL20 MEASUREMENT MODEL



W1 = (Growth-LP), W2 = (LP+P.Wheat-TEMP), W3 = (Commodity Markets).

Monday, July 20, 2026

Austerity Forecasts for the UK (1980-2060)


The AUST index (see the details below) captures a number of issues of importance in UK Politics: (1) Increasing military expenditures to meet Russian Challenges and US withdrawals from NATO, (2) Increasing Health Expenditures to upgrade the National Health Service (NHS) and at the same time, (4) Not reducing Education Expenditures and (5) Not increasing overall Government expenditures.









Notes

  • Shefner, 2015 here and here Austerity and Anti-Systemic Protest, JWSR.


UK AUST Measurement Model



The AUST index has three components that explain 96% of the variation in the indicators. AUST1 = (Overall Growth), AUST2 = (GE+G+GE-GH) and AUTS3 = (G+GM-GE-GH) where GE=(Government Education), G=(Total Government), GE=(Government Eduction), GH=(Government Health) and (GM=Government Military).


Overtime, AUST1 increased and reached a asymptote around 2010, AUST2 peaked in 1975 and 2010 and AUST3 increased from 1975 until 2000 and then started increasing again after 2010.



UK AUST1 AICs


The best AUST1 model takes the W-index as input.

UK AUST1 W Input Model



The AUST1 W-Input model is stable with negative effects from W3 (World Commodity Markets).



Over time



W3 peaks around 1980 and increases again after 2010.



Hardship Forecasts for the United Kingdom (1980-2060)







Notes


UKL20 HARD Measurement Model








UK1 AIC Statistics










 

Monday, July 13, 2026

UKL20: Shrinking the Financial Sector (1980-2060)


 


A 2026 change in political leadership in the United Kingdom (UK) triggered by a no-confidence vote, brings up the issue of what policies might be expected from the new Labor Government, potentially headed by Andy Burnham, champion of the Green New Deal UK. One of the core goals of the Green New Deal UK (see Notes below), based on analogies to the 1930s New Deal in the US, is to restructure the UK Financial Sector.


In this post, I am going to present an index of UK Financialization (FINZ) and how it might be affected by various Geopolitical Alignments as a result of Brexit, Britain leaving the European Union (EU).

The graphic above shows five possible Geopolitical Alignments and how they might affect the FINZ1 index (see Notes below, the growth component). Business-as-Usual (BAU) creates unlimited growth in the Financial Sector while other alignments (a Random Walk, RW, the US, the World System, W, and the EU) stabilize or contract the Financial Sector. The biggest contraction comes from alignment with the EU, which may have been another motivation for Brexit.

As a result of Brexit, the UK now has the opportunity to stabilize the Financial Sector by regulation Capital-Asset Ratios, Nonperforming loans and Commercial Banking growth. Whether it can redirect investment toward Green Energy Deployment is hard to predict. Although the UK has been every successful reducing CO2 Emissions; investments in dirty energy projects will not be very attractive.

Notes


UKL20 FINZ Indicator Codes


UKL20 FINZ Measurement Model


The components explain 96.7% of the variation in the indicators. FINZ1=(CommercialBanking-BankCapital-LiquidReserves). FINZ2=(BankCapital-NonperformingLoans), FINZ3=(Growth).



Historically, FINZ1 (Banking Capital and Liquid Reserves) was in balance until after 1975 as the period of Neoliberalism started. FINZ2 (BankCapital-NonperformingLoans) came into balance after 1965. FINZ3 (Overall Growth) was cyclical throughout the late 20th Century.

UKL20 FINZ1 AIC Statistics






UKL20 FINZ1 EU Model



UKL20 FINZ1 US Model


UKL20 FINZ1 UK Model



UKL20 FINZ1 BAU Model



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