Schumpeter is widely remembered for his belief in the power of innovation and entrepreneurship within a capitalist framework. In fact he argues that capitalism owes much of its success to this.

Yet, his argument about capitalism's ultimate downfall in Capitalism, Socialism and Democracy seems to show an strangely negligent view of the nature of innovation and technological change. He argues that a capitalist system will 'creatively destruct' so frequently that it will gradually systematise innovation itself. Entrepreneurship will become a job like any other.

While I agree with and respect much of Schumpeter's contribution to economics, this presumption sticks out like a sore thumb, to me it seems plain wrong. Innovation is disruptive/destructive exactly because it is new, because markets did not predict it, so how can it ever be made in to a predictable bureaucratic process? How can this otherwise exceptionally insightful gentleman, one who was among the first to identify innovation's disruptive power, argue his point in such a seemingly oxymoronic way?

  • $\begingroup$ Not sure how to answer your question, although I gave it some thought and I ended up thinking about how state-cartel universities present online courses which were originally invented to disrupt those same universities by offering the same affordable education, of course it did not happen because government has given accreditation powers to these cartels instead of accrediting the student getting the degree, so an online degree does not hold the same weight, so now an innovative idea has been acquired by the cartel it was meant to disrupt. $\endgroup$ – Daniel Dec 6 '18 at 0:55

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