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Joseph Alois Schumpeter Quotes

Joseph Alois Schumpeter was an Austrian-born American economist and political scientist. He briefly served as Finance Minister of Austria in 1919. In 1932 he became a professor at Harvard University where he remained until the end of his career. One of the most influential economists of the 20th century, Schumpeter popularized the term "creative destruction" in economics.

✵ 8. February 1883 – 8. January 1950  •  Other names Schumpeter
Joseph Alois Schumpeter photo

Works

The Theory of Economic Development
The Theory of Economic Development
Joseph Alois Schumpeter
Capitalism, Socialism and Democracy
The Theory of Economic Development
The Theory of Economic Development
Joseph Alois Schumpeter
Capitalism, Socialism and Democracy
Joseph Alois Schumpeter: 13 quotes4 likes

Famous Joseph Alois Schumpeter Quotes

“The first thing a man will do for his ideal is lie”

Joseph Alois Schumpeter

Source: History of Economic Analysis, p. 43

“When we inquire about the general forms of economic phenomena, about their uniformities, or about a key to understanding them, we ipso facto indicate that we wish at that moment to consider them as something to be investigated, to be sought for, as the “unknown”; and that we wish to trace them to the relatively “known,” just as any science deals with its object of inquiry.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 1 : The Circular Flow of Economic Life as Conditioned by Given Circumstances

“Geniuses and prophets do not usually excel in professional learning, and their originality, if any, is often due precisely to the fact that they do not.”

Joseph Alois Schumpeter book Capitalism, Socialism and Democracy

Source: Capitalism, Socialism and Democracy

“Since as we have seen the entrepreneurial qualification is something which, like many other qualities, is distributed in an ethnically homogeneous group according to the law of error, the number of individuals who satisfy progressively diminishing standards in this respect continually increases. Hence, neglecting exceptional cases — of which the existence of a few Europeans in a negro population would be an example — with the progressive lightening of the task continually more people can and will become entrepreneurs, wherefore the successful appearance of an entrepreneur is followed by the appearance not simply of some others, but of ever greater numbers, though progressively less qualified.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

“The swarm-like appearance of new combinations easily and necessarily explains the fundamental features of periods of boom.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

“In all cases, not only in the two which we have analyzed, recovery came of itself. There is certainly this much of truth in the talk about the recuperative powers of our industrial system. But this is not all: our analysis leads us to believe that recovery is sound only if it does come of itself. For any revival which is merely due to artificial stimulus leaves part of the work of depressions undone and adds, to an undigested remnant of maladjustment, new maladjustment of its own which has to be liquidated in turn, thus threatening business with another crisis ahead. Particularly, our story provides a presumption against remedial measures which work through money and credit. For the trouble is fundamentally not with money and credit, and policies of this class are particularly apt to keep up, and add to, maladjustment, and to produce additional trouble in the future.”

Joseph Alois Schumpeter

"Depressions: Can we learn from past experience?" in Schumpeter, Joseph A.; Chamberlin, Edward; Leontief, Wassily W.; Brown, Douglass V.; Harris, Seymour E.; Mason, Edward S.; Taylor, Overton H., The economics of the recovery program (1934)

Joseph Alois Schumpeter Quotes

“The more the process of development becomes familiar and a mere matter of calculation to all concerned, and the weaker the obstacles become in the course of time, the less the “leadership” that will be needed to call forth innovations. Hence the less pronounced will become the swarm-like appearance of entrepreneurs and the milder the cyclical movement.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

“The innovation is hazardous, impossible for most producers. But if someone establishes a business having regard to this source of supply, and everything goes well, then he can produce a unit of product more cheaply, while at first the existing prices substantially continue to exist. He then makes a profit. Again he has contributed nothing but will and action, has done nothing but recombine existing factors. Again he is an entrepreneur, his profit entrepreneurial profit. And again the latter, and also the entrepreneurial function as such, perish in the vortex of the competition which streams after them. The case of the choice of new trade routes belongs here.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 4 : Entrepreneurial Profit

“Economists have never allowed their analysis to be influenced by psychologists of their time, but have always framed for themselves such assumptions about psychical processes as they have thought it desirable to make.”

Joseph Alois Schumpeter

Joseph Schumpeter, History of Economic Analysis, 1945. p. 27

“Only a few people have these qualities of leadership and only a few in such a situation, that is a situation which is not itself already a boom, can succeed in this direction. However, if one or a few have advanced with success many of the difficulties disappear. Others can then follow these pioneers, as they will clearly do under the stimulus of the success now attainable. Their success again makes it easier, through the increasingly complete removal of the obstacles analysed in the second chapter, for more people to follow suit, until finally the innovation becomes familiar and the acceptance of it a matter of free choice.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

“Chentlemen, you are vorried about the depression[sic]. You should not be. For capitalism, a depression is a good, cold douche.”

Joseph Alois Schumpeter

To economics students, recorded by R. L. Heilbroner, The Worldly Philosophers, 1953

“Why do entrepreneurs appear, not continuously, that is singly in every appropriately chosen interval, but in clusters? Exclusively because the appearance of one or a few entrepreneurs facilitates the appearance of others, and these the appearance of more, in ever-increasing numbers.”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

“Many things may be copied by the latter; the example as such also acts upon them; and many achievements directly serve other branches too […].”

Joseph Alois Schumpeter The Theory of Economic Development

The Theory of Economic Development (1934), Ch. 6 : The Business Cycle

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