Creative Destruction and Partial Obsolescence in American Economic Development

With the growing emphasis on structural change and Schumpeterian innovation in economic development, the paradoxical concept “creative destruction” has come into wide use among economists and economic historians. It is an appealing concept because it recalls the death and birth cycles of nature and various tribal myths of gods shuttling between ferocity and compassion. But the concept has been applied to economic situations rather casually. This paper suggests that “creative destruction” is not an apt description of the way dominant production methods succeeded one another in the United States from 1850 to 1914, even though the term is applled to this era more than to any other. Data are presented to show that apparently obsolete methods survived and grew in the face of novel competition. An explanation of the staying power of partially outdated production methods is attempted.