Schumpeter’s Contemporary Relevance
December 9, 2011 Leave a comment
McQuinn Center friend and Université d’Angers doctoral student Matt McCaffrey writes in today’s International Business Times on the relevance and importance of Schumpeter’s thinking on the entrepreneur.
From the article:
While he was by no means the perfect economist, he remains one of the most challenging and thought-provoking minds of the 20th century. Schumpeter has been called the “prophet of innovation” because of his emphasis on the importance of the entrepreneur in driving the economy. Sometimes, however, he played the role of a sort of end-of-the-world prophet, predicting the decline of capitalist economies into socialism.
Matt goes on to talk about how Schumpeter’s thinking, developed and written down during the Great Depression, seems to be equally applicable on the current financial crisis. And he discusses how entrepreneurship is ultimately crippled by what economist Robert Higgs terms “regime uncertainty.” Interestingly, while some economists (Knight, Mises) define entrepreneurship as uncertainty bearing, the forceful changing of the rules of the game – regime uncertainty – distorts, undermines, and ultimately makes uncertainty bearing impossible.