creative destruction

Also found in: Encyclopedia, Wikipedia.

Creative Destruction

A concept in capitalist theory stating that innovation causes failure, but that failure, in turn, creates more innovation. For example, suppose someone invents a better widget. If he/she markets this widget effectively, he/she will eventually drive all previous widget manufacturers out of business. However, this forces older widget manufacturers to create their own innovations that will either keep themselves in business or improve their financial situations in other ways. This is considered one of the most important concepts in capitalism.

creative destruction

Mentioned in ?
References in periodicals archive ?
There is an economic theory called Creative Destruction which is based around the same principle.
SMEs are both an engine of job creation and a significant factor in job destruction, making them the embodiment of Schumpeter s creative destruction , i.
Chris Newfield offers a cogent discussion of this wider context, as well as a clear tracing of the lineage from Joseph Schumpeter's creative destruction to Christensen's disruptive innovation, in his June post on Remaking the University.
16, 2014 /PRNewswire-USNewswire/ -- With more than $130 million in aggregate equity value created among ventures graduating from its first two cohorts, the Creative Destruction Lab at the Rotman School of Management is back at work with its third cohort.
One of the most problematic effects of Schumpeterian entrepreneurship and creative destruction in America is inequality.
Still, if more firms follow RCAP's lead and build platforms for smaller retail investors, they could pose a serious challenge--not only to startups, but to our understanding of creative destruction.
Economists have a charming term for this cascading causality: creative destruction - "destruction" because the status quo crumbles, "creative" because something new takes its place.
In particular, Liu voices a concern over the creative destruction of historical consciousness in the humanities, arguing that with "technologies, techniques, and the efficiency of their alignment .
It is a concept worth thinking about as the regional channel grapples with the creative destruction that is ripping the traditional solution provider and reseller business model to shreds.
THE BENEFITS OF CREATIVE DESTRUCTION in terms of new products and more efficient processes are substantial (Schumpeter, 1950; DeLong, 2000).
The creative destruction of medicine; how the digital revolution will create better health care.
When the Austrian-American economist Joseph Schumpeter developed his ideas about creative destruction more than 70 years ago, he wasn't celebrating capitalism so much as predicting its eventual demise -- in part through its own doing.

Full browser ?