Professor John Hall
Journal of Economic Literature Classification Codes
N13, N14, B3
Circular Flow, Creative Destruction, Entrepreneur, Innovation, Karl Marx
In his writings Joseph Schumpeter stresses the important role played by the entrepreneur, serving as the agent bringing about change and contributing dynamic activities to an economy. Also, Schumpeter views capitalism as an evolving system, with his entrepreneur contributing to this evolution. Schumpeter also stresses the importance of innovation for enabling an entrepreneur to earn and accumulate profits. Related to innovation, Schumpeter’s entrepreneur can help bring about a “creative destruction.” This is thought to take place as outmoded businesses fail and their productive assets are bought up and creatively reorganized and brought back into production. In this manner, Schumpeter’s entrepreneur can be thought of as revitalizing the capitalistic system. Schumpeter also discusses Karl Marx as figure whose ideas assisted him in formulating his own understanding of capitalism.
© Serene Mistkawi
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Mistkawi, Serene "On Joseph Schumpeter and Economic Development, Working Paper No. 49", Portland State University Economics Working Papers. 49. (15 June 2020) i + 16 pages.