Joseph SchumpeterJoseph Schumpeter

Imperialism: A Product of Imperialism: A Product of AtavismAtavism

Intellectual Environment of Intellectual Environment of SchumpeterSchumpeter

• Marginalist Revolution Marginalist Revolution (1871-74)and Austrian (1871-74)and Austrian School of EconomistsSchool of Economists

• Eugen von Eugen von Böhm-BawerkBöhm-Bawerk and and Friedrich von Friedrich von WieserWieser

• Leon Walrus and Leon Walrus and Equilibrium Theory Equilibrium Theory

• Austro Marxian SchoolAustro Marxian School

Elite theories of Social Elite theories of Social OrganizationOrganization• Vilfredo Pareto (15 July, Vilfredo Pareto (15 July,

1848, -August 19, 1923 )1848, -August 19, 1923 )• Trattato di sociologia Trattato di sociologia

generalegenerale (1916) (1916)• Robert Michels ( Robert Michels ( 9, Jan. 9, Jan.

1876, Cologne,- 3 May, 1876, Cologne,- 3 May, 1936 )1936 )

• Political Parties: A Political Parties: A Sociological Study of the Sociological Study of the Oligarchical Tendencies of Oligarchical Tendencies of Modern DemocracyModern Democracy

• Gaetano Mosca ( 1 April Gaetano Mosca ( 1 April 1858-8 November 1941)1858-8 November 1941)

• The Ruling Class (1896)The Ruling Class (1896)

Schumpeter A Defender of Schumpeter A Defender of Rational CapitalismRational Capitalism

• A Lawyer turned Professor A Lawyer turned Professor at Czernowitz at Czernowitz

• Theory of economic Theory of economic Development (1911)Development (1911)

• Founder of the Theory of Founder of the Theory of EntrepreneurshipEntrepreneurship

• Theory of Theory of The Theory of The Theory of Economic Development: Economic Development: An inquiry into profits, An inquiry into profits, capital, credit, interest and capital, credit, interest and the business cycle the business cycle , 1911. , 1911.

• Economic Doctrine and Economic Doctrine and Method: An historical Method: An historical sketchsketch, 1914. , 1914.

Schumpeter as a Politician and Schumpeter as a Politician and an Academican Academic• German Socialization German Socialization

CommitteeCommittee• Kiel School of Economists Kiel School of Economists

and German Marxists Such and German Marxists Such Kautsky and HilferdingKautsky and Hilferding

• Brief Tenure as Austrian Brief Tenure as Austrian Minister of Finance in 1919Minister of Finance in 1919

• President of Bank and President of Bank and Professorship at BonnProfessorship at Bonn

• Harvard University in 1932Harvard University in 1932• Mentor of Paul SamuelsonMentor of Paul Samuelson

Veblen and German StateVeblen and German State

• Influence of Thorstein Influence of Thorstein VeblenVeblen

• Imperial Germany and Imperial Germany and the Industrial the Industrial Revolution (1915)Revolution (1915)

• Comparison between Comparison between Germany BritainGermany Britain

• The Idea of dynastic The Idea of dynastic StateState

• End of Dynastic StateEnd of Dynastic State

Schumpeter’s Idea of Schumpeter’s Idea of ImperialismImperialism

• Influence of Economic Influence of Economic Interpretation of HistoryInterpretation of History

• Proving Marxists Wrong.Proving Marxists Wrong.

• Imperialism is the Imperialism is the object-less disposition of object-less disposition of a state to expansion by a state to expansion by force without assigned force without assigned limits.limits.

• Imperialism benefits a Imperialism benefits a small clique.small clique.

Main Features of Schumpeter’s Main Features of Schumpeter’s ThesisThesis• Historical force of non-Historical force of non-

rational and irrational, rational and irrational, purely instinctive purely instinctive inclinations to war and inclinations to war and conquestconquest

• Consolidation of Class Consolidation of Class of Warriorsof Warriors

• Internal Relationships Internal Relationships and dominant positions and dominant positions of such a group in of such a group in political and economic political and economic structure structure

• Imperialism is an Imperialism is an atavism atavism

Capitalism as an anti Capitalism as an anti imperialist political economic imperialist political economic systemsystem• Imperialism a Legacy of Monarchical Imperialism a Legacy of Monarchical

StateState

• Capitalism as a rational economic Capitalism as a rational economic system opposed to direct imperial system opposed to direct imperial conquestconquest

• Dismantling of the special Interest Dismantling of the special Interest GroupsGroups

• Pacific CapitalismPacific Capitalism

Weaknesses of Schumpeter’s Weaknesses of Schumpeter’s ThesisThesis

• Too Deeply Embedded in Continental Too Deeply Embedded in Continental Context Context

• Failure to see new world wide context of Failure to see new world wide context of EmpireEmpire

• Foreign Trade led to EmpireForeign Trade led to Empire

• The Idea of Informal Economic HegemonyThe Idea of Informal Economic Hegemony

• Predictions of Modern International OrderPredictions of Modern International Order