Schumpeter’s Market
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Schumpeter’s Market

Enterprise and Evolution

David Reisman

Schumpeter was an interdisciplinary political economist who made institutional transformation the centrepiece of his theory of supply and demand. This comprehensive monograph reconstructs and assesses Schumpeter’s contribution to the restless economics of entrepreneurship, disequilibrium and search. Examining the evidence from all of Schumpeter’s published work, the book fills a significant gap in the literature of economic thought. Partly because Schumpeter was so prolific, partly because he touched on so many interrelated topics, there have been few books that have sought to span the whole of this important author's influential insights.
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Chapter 9: The Sociology of Socialism

David Reisman


The capitalists pushed the aristocrats to the brink of extinction. The next step will be for the capitalists to dig their own grave: ‘The very success of the business class in developing the productive powers of [the] country ... has paradoxically undermined the social and political position of the same business class.’ (Schumpeter, 1950b:423). Soon it too will be no more. The bourgeoisie will flourish only so long as the entrepreneurs hold sway (Schumpeter, 1942a:134). The legitimacy of the property-owning class is not in doubt so long as its leading members are known to be the iconoclasts who usher in the new. Things change radically when it is the bureaucrat on a wage who, working in a team and seldom pictured in the press, makes the decisions that shape people’s lives. Corporate capitalism is an epoch in which labour and not capital is put in control. Centralist socialism, creating nothing new, merely perpetuates the tradition of post-entrepreneurial choice when it concentrates command in the hands of salaried politicians who take no share in the profits of the firm. The sociology of capitalism gives way to the sociology of socialism once an obsolete and functionless social grouping has without disruption been tidied out of the way. This chapter is concerned in three sections with three aspects of the society that is to come: cultural values, national character and the potential for Catholic corporatism. It is not concerned with class location and class consciousness. Schumpeter, like Marx, has little or nothing...

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