Re: Schumpeter and the Capitalist Process.

 Ganesh,
       Schumpeter considers business cycles to be
historic individuals. Can one then suppose that the
Kondratieff cycle is due to the use of fossil
fuels(1887-1943 for coal and 1944-2000 for crude oil);
the Kuznets cycle to construction, naturally; the
Juglar cycle to machines and the Kitchin cycle
to...what? And, if production determins development,
why does it speed up and slow down at regular
intervals? Why did the dotcom development suddenly
fail in 2000? Why didn't all that 3rd generation stuff
keep development going? Whereas the curve was right on
cue. So how can this predictability of historic
individuals be explained?
 Writing about Hegel in a letter to Engels, Marx said
he had climbed on the shoulders of a giant and stood
him on his head. Or words to that effect. (I seem to
remember reading this in the introduction to the
Penguin edition of Capital, vol.2) Dare we do this to
Schumpeter??
      Regards, Kenneth







 --- Trichur Ganesh <tganesh@stlawu.edu> a écrit : >
Kenneth:
> A few responses come to my mind:
> (1)  Despite what you write, for Schumpeter, each
> cycle is a "historic
> individual" with its own historical specificity.  On
> this Schumpeter is
> unambiguous and this is what I read too in his work.
>  Cf. Business
> Cycles vol.1, Part 1; cf. also Theory of Economic
> Development, chapter
> on business cycles.  I point this out to argue that
> Schumpeter's attempt
> was precisely to explain each cycle individually
> even as he utilised a
> general theory of innovations for that purpose.  (On
> Kuznets I am on
> relatively unfamiliar terrain: I do recall that his
> focus was on
> construction cycles).
> (2)  Schumpeter was less concerned with growth and
> more with the
> dynamics of "development" or Entwicklung, historical
> processes by which
> the contours of the capitalist system as a system,
> unfolds over time and
> space.
> (3) Consumer Demand for Schumpeter, was a
> derivative.  Production was of
> determining importance.  I am inclined to think that
> it is still true
> today, though it is a much more contested terrain
> than in earlier
> periods (cf. N.Klein's No Logo).   Keynes' (i.e.
> Marx's) theory of
> inadequate "effective demand" is a pointer to the
> incapacity of the
> masses who have made possible the great mass
> production, to buy what
> they have produced .  But the production process
> itself, i.e., what is
> to be produced, has little to do with consumer
> demand.  'Consumer
> sovereignty' is more a longing than a 'reality',
> though one could also
> say that 'you only get what you ask for'.  But what
> is it that "you" ask
> for?  Mass assembly line production?  Sweatshop
> labor production?  Is
> there really consumer sovereignty regarding demand
> for the products of
> transnational enterprises of today or the vertically
> integrated
> multinational corporations of the 1890s-1960s?
> (4)  Debt is endogenous to the functioning of the
> economic system.  Who
> is the one who goes into debt and when do problems
> of debt arise?
> Capitalist entrepreneurs go into debt to finance the
> new plant and new
> machinery with which to plunge into production, and
> to unleash processes
> of 'creative destruction', which when complete
> provide rewards
> ('profits') that are adequate to re-pay the interest
> and loans from
> banks taken to finance the investment.  States also
> go into debt, often
> catastrophically.  Spanish bankruptcy in the 16th
> and 17th centuries,
> French bankruptcies in the 17th and 18th centuries,
> these are
> historically documented (cf. Braudel).  There are
> limits to the
> Schumpeterian construct.  What explains the debt
> crises of the 1980s and
> of the late 1990s?  On the one hand you may say
> demand for debt, but the
> demand is forthcoming precisely because there is an
> overabundance of
> liquidity, as there was in the 1980s when third
> world states began to
> borrow avidly from transnational and private banks
> and then found that
> they could not repay the loans.  Such debt crises
> are common to all
> financial expansions.  So it is not as though there
> is no space in the
> Marx/Schumpeterian process of creative destruction
> to accomodate debt
> crises.  And it is not as though no one has taken
> them into account
> either.    Ganesh Trichur.
> 
  

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