Gales of Creative Destruction

GMU's Thomas Hazlett:

"Gales of creative destruction," in Joseph Schumpeter's memorable phrase, drive the capitalist economy. The awesome result is the Free Market Innovation Machine, as William J. Baumol's 2002 treatise was titled. It delivers prosperity such as the world had never known. "Average growth rates for about one-and-a-half millennia before the Industrial Revolution are estimated to have been approximately zero," writes Baumol. "In the past 150 years, per capita incomes in a typical free-market economy have risen by amounts ranging from several hundred to several thousand percent."