IDEAS home Printed from https://ideas.repec.org/a/cup/jechis/v63y2003i04p1023-1058_00.html
   My bibliography  Save this article

Why Schumpeter was Right: Innovation, Market Power, and Creative Destruction in 1920s America

Author

Listed:
  • NICHOLAS, TOM

Abstract

Are firms with strong market positions powerful engines of technological progress? Joseph Schumpeter thought so, but his hypothesis has proved difficult to verify empirically. This article highlights Schumpeterian market-power and creative-destruction effects in a sample of early-twentieth-century U.S. industrial firms; his contention that an efficiently functioning capital market has a positive effect on the rate of innovation is also confirmed. Despite market power abuses by incumbents, the extent of innovation stands out: 21 percent of patents assigned to the firms sampled between 1920 and 1928 are cited in patents granted between 1976 and 2002.

Suggested Citation

  • Nicholas, Tom, 2003. "Why Schumpeter was Right: Innovation, Market Power, and Creative Destruction in 1920s America," The Journal of Economic History, Cambridge University Press, vol. 63(4), pages 1023-1058, December.
    • Handle: RePEc:cup:jechis:v:63:y:2003:i:04:p:1023-1058_00
    as

    Download full text from publisher

    File URL: https://www.cambridge.org/core/product/identifier/S0022050703002523/type/journal_article
    File Function: link to article abstract page
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bakker, Gerben, 2013. "Money for nothing: How firms have financed R&D-projects since the Industrial Revolution," Research Policy, Elsevier, vol. 42(10), pages 1793-1814.
    2. Wang, I. Kim & Seidle, Russell, 2017. "The degree of technological innovation: A demand heterogeneity perspective," Technological Forecasting and Social Change, Elsevier, vol. 125(C), pages 166-177.
    3. Naomi R. Lamoreaux & Kenneth L. Sokoloff & Dhanoos Sutthiphisal, 2008. "The Reorganization of Inventive Activity in the United States during the Early Twentieth Century," NBER Chapters, in: Understanding Long-Run Economic Growth: Geography, Institutions, and the Knowledge Economy, pages 235-274, National Bureau of Economic Research, Inc.
    4. David B. Audretsch & Antje Fiedler, 2023. "Power and entrepreneurship," Small Business Economics, Springer, vol. 60(4), pages 1573-1592, April.
    5. Olszewski Krzysztof & Trojanowski Dariusz & Łaszek Jacek, 2024. "Low Interest Rates and Uncreative Destruction in the Office Market," Real Estate Management and Valuation, Sciendo, vol. 32(2), pages 90-99.
    6. Etro, Federico, 2008. "Growth leaders," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 1148-1172, September.
    7. Chandril Bhattacharyya & Dibyendu Maiti, 2023. "Informal Sector, Innovation and Growth," Working papers 334, Centre for Development Economics, Delhi School of Economics.
    8. Arthur M. Diamond, Jr., 2006. "Schumpeter's Creative Destruction: A Review of the Evidence," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 22(Fall 2006), pages 120-146.
    9. Mihaela Ghicajanu & Gabriel Dolea, 2018. "The Role of Innovation in Increasing Business Quality and the Added Value for the Customer," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 18(2), pages 45-52.
    10. Konstantinos Konstantakis & Panayotis G. Michaelides & Theofanis Papageorgiou, 2014. "Sector size, technical change and stability in the USA (1957-2006): a Schumpeterian approach," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 41(10), pages 956-974, October.
    11. Jürgen Bierbaumer-Polly & Sandra Bilek-Steindl & Thomas Url, 2019. "Monitoring and Nowcasting Sustainable Development Goals. A Case Study for Austria," WIFO Studies, WIFO, number 66635, March.
    12. Naoto Jinji & Xingyuan Zhang & Shoji Haruna, 2022. "Deep Integration, Global Firms, and Technology Spillovers," Advances in Japanese Business and Economics, Springer, number 978-981-16-5210-3, June.
    13. Zhao, Shengchao & Zeng, Deming & Li, Jian & Feng, Ke & Wang, Yao, 2023. "Quantity or quality: The roles of technology and science convergence on firm innovation performance," Technovation, Elsevier, vol. 126(C).
    14. Xu, Fei & Liu, Qian & Zheng, Xingdong & Cao, Luqi & Yang, Mian, 2022. "Research on the impact of China's high-speed rail opening on enterprise market power: Based on the perspective of market segmentation," Transport Policy, Elsevier, vol. 128(C), pages 121-137.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cup:jechis:v:63:y:2003:i:04:p:1023-1058_00. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kirk Stebbing (email available below). General contact details of provider: https://www.cambridge.org/jeh .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.