Essay on Joseph A. Schumpeter ⋆ Sociology Essay Examples ⋆ EssayEmpire

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Schumpeter is generally acknowledged as one of the first-rank economists of the twentieth century, along with John Maynard Keynes. He was born in Tfest, a small Moravian town in the Austro-Hungarian Empire (now the Czech Republic). He was educated at the University of Vienna. He taught at some provincial universities (Czernowitz, Graz, and Bonn), and for a short period after World War I he held the post of finance minister under the Austrian socialist government. In 1932 Schumpeter moved to Harvard University, and stayed there until his death.

Schumpeter’s central concern was the formulation of the evolution of the capitalist economic system. His wide-ranging project can be interpreted as consisting of a system of substantive theory, i.e., (1) economic statics, (2) economic dynamics, and (3) economic sociology, and a system of metatheory, i.e., (4) the philosophy of science, (5) the history of science, and (6) the sociology of science, and is called a three-layered, two-structure approach to mind and society (Shionoya 1997). The ambitious aim Schumpeter cherished throughout his academic life was a ”comprehensive sociology,” an approach to social phenomena as a whole. Its central idea is the Soziologisierung (sociologizing) of all social sciences. Schumpeter’s two-structure approach was intended to replace Marx’s social theory based on the economic interpretation of history.

Schumpeter’s economic dynamics or theory of economic development is well known for its emphasis on entrepreneurial innovation in a capitalist economy that includes new products, new techniques, new markets, new sources of supply and new forms of organization. He called the process of economic development ”creative destruction,” referring to the destruction of existing economic order by the introduction of innovation.

Schumpeter defined economic sociology as ”a sort of generalized or typified or stylized economic history.” The core of economic sociology is the concept of an institution that can generalize, typify, or stylize the complexities of economic history consisting of a series of innovations. He identified economic sociology as the fourth basic technique of economic analysis besides theory, statistics, and history.

In Capitalism, Socialism, and Democracy (1942), Schumpeter presented his famous thesis on the demise of capitalism as the result of its success. The relevance of Schumpeter’s idea of economic sociology is its impact on the growth of institutional economics and evolutionary economics after World War II.

Bibliography:

Schumpeter, J. A. (1950) [1942] Capitalism, Socialism, and Democracy, 3rd edn. Harper & Brothers, New York.
Shionoya, Y. (1997) Schumpeter and the Idea of Social Science: A Metatheoretical Study. Cambridge University Press, Cambridge.