It is great to see that The Economist is using “Schumpeter” as the name for a new column on business and management that it is launching.
I am looking forward to becoming a loyal reader.
In response to the launch of this new column, I am posting this slightly revised version of an item that I wrote a little over two years ago.
Back then, I made the argument that it is vital to begin to re-think Schumpeter’s important contributions and his signature notion of how “the perennial gale of creative destruction” plays a central role in capitalism.
Despite all the deserved attention that Schumpeter is getting, there is an important issue that also merits discussion, namely:
The way that quantitative changes in the amount and the rate of Schumpeterian transformation are triggering important qualitative changes in the nature of Schumpeter’s creative destruction.
In fact, a tsunami of “Industrial-Strength Creative Destruction” is flooding across virtually every part of the world…and our encounter with “Schumpeter on Steroids” is cramming unprecedented change and transformation into every nook and cranny of the planet.
If you look back to the first half of the 20th century, you can see that the industrialization and mass-production of manufactured goods began to radically change not only the quantity of those goods, but also the nature of the goods that were produced and the roles that those products played in our lives.
In an analogous sense, the new “mass-production of creative destruction” has important implications for the role and nature of Schumpeterian change…and for the role and nature of innovation in today’s world.
I’ve touched upon these issues in several “Articles from the Archives” that already have made it onto this site (for example, In Praise of Bad Ideas and Nobel Laureate on R&D Changes), and I expect to be exploring other implications – specific and general – in future postings.
So, stay tuned for more…much more.
In the meantime, here are few links to a selection of notable recent items about Schumpeter and to the book that spurred my initial posting back in 2007, the biography of Schumpeter by Pulitzer-winning historian Thomas K. McCraw.
- Fifty years on, Schumpeter’s brand of capitalism is all the rage – This piece from the Globe and Mail does a nice job of outlining Schumpeter’s key ideas and connecting them to a number of current business and economic developments, e.g., the emergence of China, the growing role of private equity.
- The SUMMER BOOKS ISSUE from The National Dialogue on Entrepreneurship (NDE) – The NDE has included McGraw’s book on a fascinating list of readings about entrepreneurship and innovation.
- Unfettered finance is fast reshaping the global economy – In this excellent piece in the Financial Times, Martin Wolf makes a strong argument that “We are witnessing the transformation of mid-20th century managerial capitalism into global financial capitalism”…and sketches out a few of the early implications that are beginning to emerge.