Abstract
The paper interprets certain parts of Joseph Schumpeter’s oeuvre in association with the writings of Rudolf Hilferding. For instance, we show that Hilferding’s conception of economic development has striking similarities with Schumpeter’s respective thesis. Also, Hilferding expressed the thesis that ‘the size and technical equipment of the monopolistic combination ensure its superiority’ which has striking similarities with the so-called Schumpeterian Hypothesis. Furthermore, Hilferding made a distinction between the entrepreneur who is in charge of the use of capital in production and the capitalist who advances his capital and bears the risk. There, Hilferding identified another personality who has similar tasks to those of an innovative manager. It is exactly this separation of roles which is at the core of Schumpeter’s famous analysis. Moreover, regarding credit, for both theoreticians, it is determined by its demand side i.e. creation of credit money resulting from the demand for investment funds and is indispensable for the functioning of capitalism. In this context, their views on economic instability have further similarities, since for both theorists, development presupposes an innovation, which enables the firm to earn an extra profit and stimulates the demand for credit in order to finance new investments through credit creation. As for socialism, Hilferding regarded it as the organization of production not by and for the benefit of capitalist magnates but by and for society as a whole, whereas for Schumpeter socialism is an institutional arrangement that vests the management of the productive forces with some public authority. Finally, regarding imperialism, Schumpeter differentiated himself from Hilferding and considered it to be an ‘old’ inheritance from pre-modern capitalist eras, which was bound to disappear contrarily to Hilferding, who regarded imperialism as a ‘new’, characteristic of capitalism in its ‘latest’ stage. In brief, some of Schumpeter’s ideas are probably not quite as unique as they appeared to be, since many of them could be described as a reworking of Hilferding’s views. Apparently, Schumpeter’s originality is, at least partly, based on the approaches on which he built his oeuvre.
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It is with great pleasure that we contribute this paper in honour of Mark Perlman. It is, most of all, a great privilege to have been asked to do so.
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Michaelides, P.G., Milios, J.G. The Schumpeter–Hilferding Nexus. J Evol Econ 25, 133–145 (2015). https://doi.org/10.1007/s00191-014-0361-9
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DOI: https://doi.org/10.1007/s00191-014-0361-9