Creative Destruction

The idea of creative destruction describes how new innovations are constantly being generated by entrepreneurs in order to displace older ones in a cyclical dynamic that is the driving force behind the evolution of capitalist economics. The idea of creative destruction was expressed in the work of Joseph Schumpeter in his book </span>The Theory of Economic Development where he describes a circular flow to economic development which, excluding any innovative activities, leads to a stationary state of equilibrium, order, and predictability. The entrepreneur is the one that disturbs this equilibrium and is thus the prime cause of economic development, which proceeds in a cyclical fashion along several time scales. The central premise being that capitalism can only be understood as an evolutionary process of continuous innovation and "creative destruction."</span>

Systems Innovation

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