Schumpeterian endogenous growth theory and evolutionary economics

In this paper, we aim to discuss whether Schumpeterian models of endogenous growth can accommodate Schumpeter’s vision of development through creative destruction. Taking a methodological approach, our focus is on individual decision-making, technology, general equilibrium and welfare, and steady state dynamics as the fundamental principles underlying endogenous growth theory. In particular, the Aghion-Howitt model of Schumpeterian growth in various extended versions is analyzed in the light of Schumpeter’s work. Therefore, we also try to root Schumpeter’s work in historical context. We find endogenous growth theory far from carrying Schumpeter’s idea of an evolutionary approach to change and development. Rather the emergence of numerous models of an evolutionary type can be observed to provide for the formal structure appropriate to keeping Schumpeter’s legacy alive.

Authors and Affiliations

1. LIHRE/CNRS, University of Toulouse 1, 31042, Toulouse cedex, France

   Alain Alcouffe

2. Department of Economics and Business Administration, University of Technology Chemnitz, 09107, Chemnitz, Germany

   Thomas Kuhn

Corresponding author

Correspondence to Alain Alcouffe.

JEL Classification:

B1, B2, B4, O3, O4

Corespondence to: Thomas Kuhn

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