Schumpeter

"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 same process of industrial mutation—if I may use that biological term—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 [Schumpeter’s emphasis]. CSD, 83.

Capitalism…is by nature a form or method of economic change and not only never is but never can be stationary. CSD, 82.

[Capitalism is]…the perennial gale of creative destruction. CSD, 84.

Economies don’t grow, they evolve. The dictionary defines growth as an increase in quantity or size. If an economy were to literally grow, it would have more or bigger companies hiring more of the same kinds of workers and producing more of the same goods and services. Evolution, in contrast, is a process of continuous change, leading to a higher, more complex and better state. Capitalist economies evolve, and their evolution is endogenous, arising spontaneously from the ingredients of the capitalist economic system. The competition to innovate (so as to gain market share or simply survive) pushes living standards forever onward and upward like a perpetual-motion machine. Moreover, there is no reason to believe that progress will slow over time; indeed, it may even speed up as new technologies spill over into other areas, making whole new industries possible or economically feasible. Technology spillovers—unintended consequences—are the alchemy of the capitalist macroeconomic system. Doom-saying in the capitalist economy is a losing proposition. The essential point to grasp is that in dealing with capitalism we are dealing with an evolutionary process. CSD, 82.

Innovation is the outstanding fact in the economic history of capitalist society or in what is purely economic in that history, and also it is largely responsible for most of what we would at first sight attribute to other factors. BC, 86.

Surely, nothing can be more plain or even more trite common sense than the proposition that innovation…is at the center of practically all the phenomena, difficulties, and problems of economic life in capitalist society. BC, 87.

These revolutions periodically reshape the existing structure of industry by introducing new methods of production—the mechanized factory, the electrified factory, chemical synthesis and the like; new commodities, such as railroad service, motorcars, electrical appliances; new forms of organization. CSD, 68.

Those revolutions are not strictly incessant; they occur in discrete rushes which are separated from each other by spans of comparative quiet. The process as a whole works incessantly however, in the sense that there always is either revolution or absorption of the results of revolution, both together forming what are known as business cycles. CSD, 83, footnote 2.
Our model…does not give to prosperity and recession…the welfare connotations which public opinion [typically] attaches to them. Commonly, prosperity is associated with social well-being, and recession with a falling standard of life. In our picture they are not, and there is even an implication to the contrary. BC, 142.

Times of innovation…are times of effort and sacrifice, of work for the future, while the harvest comes after.…The harvest is gathered under recessive symptoms and with more anxiety than rejoicing.…[During] recession…much dead wood disappears. BC, 143.

If we glance at those long waves in economic activity, analysis…reveals the nature and mechanism of the capitalist process better than any-thing else. Each of them consists of an "industrial revolution" and the absorption of its effects. CSD, 67.

The Firm, Innovation and ProfitFirms—particularly new ones—are the means by which innovation enters the economy. Firms have a life cycle that begins with the introduction of a new, better or cheaper product and ends likewise (with a competitor’s introduction elsewhere). Firms tend to be the most profitable when young, before competitors have had the time to enter the market with a cheaper, better alternative. Economic development flows from innovation, and innovation requires anticipated profit, but profit sows the seeds of its own demise by beckoning other suppliers (even outright copiers). Patent laws, in this regard, can help to preserve profit and thus stimulate innovation. But over the long term, the law of the corporate jungle is clear: mutate or die.
Most new firms are founded with an idea and for a definite purpose. The life goes out of them when that idea or purpose has been fulfilled or has become obsolete or even if, without having become obsolete, it has ceased to be new. That is the fundamental reason why firms do not exist forever. Many of them are, of course, failures from the start. Like human beings, firms are constantly being born that cannot live. Others may meet…death from accident or illness. Still others die a "natural" death, as men die of old age. And the "natural" cause, in the case of firms, is precisely their inability to keep up the pace in innovating which they themselves had been instrumental in setting in the time of their vigor. BC, 94–95.

Without development there is no profit, without profit no development. TED, 154.


The carrying into effect of an innovation involves, not primarily an increase in existing factors of production, but the shifting of existing factors from old to new uses….If innovation is financed by credit creation, the shifting of the factors is effected not by the withdrawal of funds—"canceling the old order"—from the old firms, but by the reduction of the purchasing power of existing funds which are left with the old firms while newly created funds are put at the disposal of entrepreneurs: the new "order to the factors" comes, as it were, on top of the old one, which is not thereby canceled. BC, 111–12.

The capitalist process, not by coincidence but by virtue of its mechanism, progressively raises the standard of life of the masses. It does so through a sequence of vicissitudes, the severity of which is proportional to the speed of the advance. But it does so effectively. One problem after another of the supply of commodities to the masses has been successfully solved by being brought within the reach of the methods of capitalist production. CSD, 68.

The capitalist engine is first and last an engine of mass production which unavoidably means also production for the masses. CSD, 67.

Electric lighting is no great boon to anyone who has money enough to buy a sufficient number of candles and to pay servants to attend them. It is the cheap cloth, the cheap cotton and rayon fabric, boots, motorcars and so on that are the typical achievements of capitalist production, and not as a rule improve-ments that would mean much to a rich man. Queen Elizabeth owned silk stockings. The capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within the reach of factory girls in return for steadily decreasing amounts of effort. CSD, 67.

Capitalism inevitably…educates and subsidizes a vested interest in social unrest. CSD, 146.
One of the most important features of the later stages of capitalist civilization is the vigorous expansion of the educational apparatus and particularly of the facilities for higher education. CSD, 152.

The hostility of the intellectual group—amounting to moral disapproval of the capitalist order—is one thing, and the general hostile atmosphere which surrounds the capitalist engine is another thing. CSD, 153.

Capitalist evolution produces a labor movement which obviously is not the creation of the intellectual group. But it is not surprising that such an opportunity and the intellectual demiurge should find each other. Labor never craved intellectual leadership but intellectuals invaded labor politics. They had an important contribution to make: they verbalized the movement, supplied theories and slogans for it—class war is an excellent example—made it conscious of itself….They naturally radicalized it, eventually imparting a revolutionary bias to the most bourgeois trade-union practices….Having no genuine authority and feeling always in danger of being unceremoniously told to mind his own business,…[the intellectual] must flatter, promise and incite, nurse left wings…appeal to fringe ends.…Thus, though intellectuals have not created the labor movement, they have yet worked it up into something that differs substantially from what it would be without them….[This]…explains why public policy grows more and more hostile to capitalist interests. Intellectuals rarely enter professional politics and still more rarely conquer responsible office. But they staff political bureaus, write party pamphlets and speeches, act as secretaries and advisers, make the…politician’s…reputation….In doing these things they…impress their mentality on almost everything that is being done. CSD, 153–54.

Capitalism stands its trial before judges who have the sentence of death in their pockets….The only success victorious defense can possibly produce is a change in the indictment. CSD, 144.


References
BC: Schumpeter, Joseph A. (1939), Business Cycles: A Theoretical, Historical, and Statistical Analysis of the Capitalist Process (New York: McGraw-Hill).
CSD: ——— (1950), Capitalism, Socialism, and Democracy, 3rd ed. (New York: Harper and Brothers), orig. pub. 1942.
HEA: ——— (1954), The History of Economic Analysis (New York: Oxford University Press).
TED: ——— (1936), The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle (Cambridge, Mass.: Harvard University Press).

Fonte: http://www.dallasfed.org/research/ei/ei0103.html