Joseph Schumpeter had three goals in his life: To become the greatest lover in Austria, the greatest horseman in Europe and the greatest economist in the world. (Sandmo, 2011) I cannot assess his achievements in the first two areas but there is no doubt that he became an important economist and father of entrepreneurship and innovation research.
This essay will show how Joseph Schumpeter influenced the evolution of conceiving and developing concepts of entrepreneurship and innovation. This essay will be structured in three sections. In the first section I will explain Schumpeter’s theory on equilibrium and economic development and I will describe the role of the entrepreneur as an agent of change, also taking into account the time context and his peers. The second section will show how Schumpeter became the foundation and a source of inspiration for subsequent scholars in the area of entrepreneurship and innovation research. The last section will critically look at the importance of Schumpeter for our understanding of entrepreneurship and innovation but also the limitations of his work.
Table of Contents
- Schumpeter and his theory in the context of the history of economic thought
- Schumpeter's legacy
Objectives and Key Themes
This essay explores the impact of Joseph Schumpeter's work on our understanding of entrepreneurship and innovation. It examines his theories on equilibrium and economic development, the role of the entrepreneur as an agent of change, and the influence of his work on subsequent scholars in the field.
- Schumpeter's theory of equilibrium and economic development
- The role of the entrepreneur as an agent of change
- Schumpeter's legacy on entrepreneurship and innovation research
- The importance of Schumpeter's work for understanding entrepreneurship and innovation
- The limitations of Schumpeter's work
Chapter Summaries
Schumpeter and his theory in the context of the history of economic thought
This section discusses Schumpeter's rejection of the neoclassical economic model and his emphasis on the role of the entrepreneur as a driver of change. It explores his concept of "creative destruction" and his differentiation between "competitive capitalism" and "trustified capitalism." It also examines his theory of innovation waves and the different types of business cycles he identified.
Schumpeter's legacy
This section focuses on the impact of Schumpeter's work on subsequent scholars in the field of entrepreneurship and innovation. It examines the resource-based view, the human capital theory, the knowledge-based view, and the intellectual capital view. It also highlights the importance of Schumpeter's concept of innovation as a cumulative process.
Keywords
Entrepreneurship, innovation, equilibrium, economic development, creative destruction, competitive capitalism, trustified capitalism, innovation waves, business cycles, resource-based view, human capital theory, knowledge-based view, intellectual capital view, cumulative innovation.
Frequently Asked Questions
What is Joseph Schumpeter's theory of "Creative Destruction"?
It describes the process of industrial mutation that incessantly revolutionizes the economic structure from within, destroying the old one and creating a new one through innovation.
How did Schumpeter define the role of the entrepreneur?
The entrepreneur is seen as an "agent of change" who drives economic development by introducing new combinations of products, methods, or markets.
What is the difference between "competitive" and "trustified" capitalism?
Competitive capitalism relies on individual entrepreneurs, while trustified capitalism refers to a stage where innovation is increasingly systematized within large corporations.
How does Schumpeter's work influence modern human capital theory?
Schumpeter's focus on the individual's ability to innovate laid the foundation for theories that value knowledge, skills, and intellectual capital as primary economic resources.
What are the limitations of Schumpeter's theories?
Critics point out that his work may underestimate the role of incremental innovation and the influence of institutional frameworks beyond the individual entrepreneur.
- Quote paper
- Kai Wright (Author), 2014, Entrepreneurship and Innovation. About the legacy of Joseph Schumpeter, Munich, GRIN Verlag, https://www.grin.com/document/295453
