on 29 November 2011
Joseph Alois Schumpeter is a must-read genius. He wasn't a nice men at all, but what he has to say about the present is v important.His belief in 'creative destruction' -ie that innovations are accomplished under capitalism at massive cost to human beings means that the economic system is always vulnerable - because people don't like pain or insecurity and, given the choice, will reject them. So in his view 'socialism' is always likely to be more acceptable. But socialism blocks off innovation. What we think of as socialism - high taxes, government control etc, leads to stagnation, loss of liberty etc.It hasn't yet quite happened like that - because of the numerous quite successful attempts to create a Middle Way. But it might well do. Does anyone like our present economic system? Does anyone NOT believe it is somehow doomed? These are the questions that Schumpeter asks in this great, little-known book.
on 21 May 2012
Schumpeter's ideas have made a comeback of late, especially in the digital technology market that likes to think of itself in the midst of his 'gale of creative destruction.' However, those who cite him would do well to read him more closely, and see the concerns he expresses about capitalism without a social dimension, and the foolish conceit of 'perfect competition' still taught in our (quite evidently failing) business schools. His style is tendentious to be sure, and requires close reading for its twists and turns, but well worth the concentration if you want to understand the forces of capitalism. Steglitz' intro is also a bit of a gem in this edition.