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Jun 18, 2022 · Economist Joseph Schumpeter warned against such monopoly fatalism. He recognized that the most important long‐ term competitive pressure comes from new products cannibalizing incumbent...
He cited the Aluminum Company of America as an example of a monopoly that continuously innovated in order to retain its monopoly. By 1929, he noted, the price of its product, adjusted for inflation, had fallen to only 8.8 percent of its level in 1890, and its output had risen from 30 metric tons to 103,400.
Joseph Alois Schumpeter ( German: [ˈʃʊmpeːtɐ]; February 8, 1883 – January 8, 1950) [3] was an Austrian political economist. He served briefly as Finance Minister of Austria in 1919.
In taking a page from Schumpeter, we suggest that monopoly, or the prospect of monopoly, is an engine of creative production, which necessarily undergirds economic progress, in contrast to much ingrained wisdom that sug-gests that monopoly is a drag on economic progress.
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Defenders of Mr. Gates and Microsoft Corp. like to cite Schumpeter's theories on monopoly. Schumpeter believed there was nothing wrong with monopolies and that they could be more effective...
Schumpeter’s view of “monopoly capitalism” is complex. Rather than merely attack or criticize monopolists, Schumpeter saw them as valuable and necessary if momentary players. Their rise, he argued, typically reflects the application of novel technologies that allow them briefly to gain expanded market share and enlarged profit margins.
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Joseph Schumpeter's analysis of capitalism and creative destruction is deeply rooted in early-twentieth-century American history. His oft-cited observation that new technologies bring about competition "which strikes not only at the margins of the profits and outputs of existing firms, but at their
