JOSEPH SCHUMPETER: CREATIVE DESTRUCTION

Joseph A. Schumpeter was concerned with the mechanisms of the market economy. He claimed that this was innovation but the ghost of the "the invisible hand". He also saw the necessity of the creative destruction which could be read as constitutive of capitalist organisation.

From this vertex, the theory of the business cycle was developed, where innovation triggered growth or a "bubble" which other can ride before it goes into a downswing or a "burst" till a new innovation lead the market to a new cycle.

Schumpeter saw the entrepreneur as the innovator .Because of this interest in the entrepreneur, Schumpeter viewed credit as important and thought the relationship between credit and active innovation as an essential feature of the capitalist logic.

But despite this, Schumpeter's cries of the adoration for capitalism, he did concede that it would collapse the social structure that made it possible. He highlighted the example of the institution of the family, which had been an ideological support for capitalism but was being undermined by it's cold rationality and individualism in the capitalist spirit.

The criticism of Schumpeter and thinkers like himself were narrowly demanding and most opponent of their critique were in the mainstream of economics thought, who did not include the social, cultural and political in their conception.

Related:

WHAT IS A CAPITALIST MARKET?

THE INTELLECTUAL DISCOURSE OF CAPITAL: KARL MARX?

Do Resteem and give a Upvote if you like this post.