Joseph Schumpeter is my favorite Austrian Economist. His ideas about the entrepreneur and creative destruction were fifty years ahead of his time. I think Schumpeter is the most penetrating analyst of capitalism who ever lived. He saw things other people didn't see,
From Capitalism and Socialism and Democracy Ch 7.
Capitalism is by nature a form or method of economic change and not only never is but never can be stationary. The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers’ goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates. The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in. Capitalism requires the perennial gale of Creative Destruction.
It is not that kind of competition which counts but the competition from the new
commodity, the new technology, the new source of supply, the new type of
organization (the largest-scale unit of control for instance)—competition
which commands a decisive cost or quality advantage and which strikes not
at the margins of the profits and the outputs of the existing firms but at their
foundations and their very lives.
Think: Apple, Google, Amazon, Netflix
"Without innovations, no entrepreneurs; without entrepreneurial achievement, no capitalist returns and no capitalist propulsion."
Joseph Schumpeter
