creative-destruction

Indeed, Schumpeter was among the first to lay out a clear concept of entrepreneurship. He distinguished inventions from the entrepreneur's innovations. Schumpeter pointed out that entrepreneurs innovate, not just by figuring out how to use inventions, but also by introducing new means of production, new products, and new forms of organization. These innovations, he argued, take just as much skill and daring as does the process of invention.
Under perfect competition all firms in an industry produced the same good, sold it for the same price, and had access to the same technology. Schumpeter saw this kind of competition as relatively unimportant. He wrote: "[What counts is] competition from the new commodity, the new technology, the new source of supply, the new type of organization... competition which... strikes not at the margins of the profits and the outputs of the existing firms but at their foundations and their very lives."
Most economists accept the latter argument and, on that basis, believe that companies should be able to keep their production processes secret, have their trademarks protected from infringement, and obtain patents.
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- The question, especially in the digital age, is how long and under what conditions such a monopoly should be extended.
  posted by brianddrpm on 2008-02-11 03:59:42

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Rediscovering Schumpeter: The Power of Capitalism — HBS Working Knowledge

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Creative Destruction's Reconstruction: Joseph Schumpeter Revisited - ChronicleReview.com

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The average literate Americans know of three 20th-century economists: John Maynard Keynes, Milton Friedman, and Alan Greenspan
post by brianddrpm on 2008-02-11 03:00:55

Schumpeter saw farther: that market capitalism destroys its own earlier generations. There is, he wrote, a constant "process of industrial mutation — if I may use that biological term — that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in, and what every capitalist concern has got to live in."
It is important to stress that a Schumpeterian entrepreneur is not an inventor, but an innovator.
He did not think governments could maintain enough social insurance to counter the destructive part of capitalism without strangling the sources of rapid growth. But why Schumpeter's Capitalism, Socialism, and Democracy places so much blame on "democracy" is unclear to me: Oligarchs fear change at least as much as democratic electorates do.
One great test of our era will be whether creative destruction can flourish alongside public order and political liberty. If not, we're in big trouble. But if so — and I'm an optimist on the point — the results could be a marvel.

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Open Innovation

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Mill, Principles of Political Economy, Book II, Chapter XV: Library of Economics and Liberty

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Information Arbitrage: Creative Destruction: Solving Problems through Innovation

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When Your Product Becomes a Commodity — HBS Working Knowledge

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Two Views of Innovation, Colliding in Washington - New York Times

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From the vantage point of a half-century, for example, it’s clear that the formation of Silicon Valley involved serendipity more than intentional design.
It appears that the Senate leadership has sympathy for the large technology companies. Opposed to big tech is a small group of high-profile inventors, like the Segway designer Dean Kamen and the former Apple engineer and QuickTime co-inventor Steve Perlman, as well as venture capitalists and a growing array of smaller businesses that do not share the market power of the largest companies. They have joined forces with the pharmaceutical industry, which has traditionally relied on the protection of a strong patent system.
Mr. Perlman says the Supreme Court has already made two landmark rulings that he says have largely addressed the “troll” problem without harming independent inventors like himself. In one case, eBay v. MercExchange, the court limited the ability of a patent covering a small feature to be used as a weapon, as in the NTP-R.I.M. settlement. In April, the court went much further in KSR International v. Teleflex, substantially raising the bar for patent holders in proving that their invention is not obvious. The ruling will make many existing patents more vulnerable and make new patents harder to get as well.
“I have to say I’m frankly astonished that apportionment has been this controversial,” said Mark A. Lemley, an intellectual-property scholar at Stanford who has testified in support of the legislation. “I can’t think of a straight-faced argument that you as a patent owner are entitled to more than your invention has contributed to a product.”
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- This may be a bridge between the innovation and collaboration article and creative-destruction I have in the conceptual stage or it may be a stand alone.
  posted by brianddrpm on 2008-01-22 01:36:17

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Seth's Blog: Music lessons

Tags: creative-destruction, fairuse, marketing on 2008-01-21 and saved by6 people -All Annotations (0) -About

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Music lessons

Things you can learn from the music business (as it falls apart)
There’s a paradox in the music business that is mirrored in many industries: you want ubiquity, not obscurity, yet digital distribution devalues your core product.
4. Permission is the asset of the future
For generations, businesses had no idea who their end users were. No ability to reach through the record store and figure out who was buying that Rolling Stones album, no way to know who bought this book or that vase.
7. Remember the Bob Dylan rule: it’s not just a record, it’s a movement.
Bob and his handlers have a long track record of finding movements. Anti-war movements, sure, but also rock movies, the Grateful Dead, SACDs, Christian rock and Apple fanboys. What Bob has done (and I think he’s done it sincerely, not as a calculated maneuver) is seek out groups that want to be connected and he works to become the connecting the point.
The biggest opportunity for the music business is to combine permission with subscription. The possibilities are endless. And I know it's hard to believe, but the good old days are yet to happen.

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David Byrne's Survival Strategies for Emerging Artists — and Megastars

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What is called the music business today, however, is not the business of producing music. At some point it became the business of selling CDs in plastic cases, and that business will soon be over. But that's not bad news for music, and it's certainly not bad news for musicians. Indeed, with all the ways to reach an audience, there have never been more opportunities for artists.
What is music?

First, a definition of terms. What is it we're talking about here? What exactly is being bought and sold? In the past, music was something you heard and experienced — it was as much a social event as a purely musical one. Before recording technology existed, you could not separate music from its social context. Epic songs and ballads, troubadours, courtly entertainments, church music, shamanic chants, pub sing-alongs, ceremonial music, military music, dance music — it was pretty much all tied to specific social functions. It was communal and often utilitarian. You couldn't take it home, copy it, sell it as a commodity (except as sheet music, but that's not music), or even hear it again. Music was an experience, intimately married to your life. You could pay to hear music, but after you did, it was over, gone — a memory.
Freedom versus pragmatism

These models are not absolute. They can morph and evolve. Hausman and Mann took the total DIY route at first, getting money orders and sending out CDs in Express Mail envelopes; later on they licensed the records to distributors. And things change over time. In the future, we will see more artists take up these various models or mix and match versions of them. For existing and emerging artists — who read about the music business going down the drain — this is actually a great time, full of options and possibilities. The future of music as a career is wide open.
No single model will work for everyone. There's room for all of us. Some artists are the Coke and Pepsi of music, while others are the fine wine — or the funky home-brewed moonshine. And that's fine. I like Rihanna's "Umbrella" and Christina Aguilera's "Ain't No Other Man." Sometimes a corporate soft drink is what you want — just not at the expense of the other thing. In the recent past, it often seemed like all or nothing, but maybe now we won't be forced to choose.

Ultimately, all these scenarios have to satisfy the same human urges: What do we need music to do? How do we visit the land in our head and the place in our heart that music takes us to? Can I get a round-trip ticket?

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Confusing Means and Ends

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So on this theme I offer you one of the funniest, albeit somewhat depressing due its truth, videos I have seen in a long time: Here Comes Another Bubble v1.1 - The Richter Scale via YouTube.
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- This brings up a number of issues that have been dealt with under the fair use posts and creative destruction posts.
  posted by brianddrpm on 2008-01-10 05:25:12
Jeff, this sures feels like another bubble. I spoke with a Web entrepreneur yesterday who is getting some good traction with his free add-on for blogs. When he mentioned that his investors were likening his product to the next Google and that it could be worth billions, I quickly ended the conversation. $50 million -- even that seems outlandish, but at least I can understand the logic of a sales price that is consistent with other sales of like Web products. But billions? What are these people thinking?

Anita

Birdied by:
Anita Campbell |
January 15, 2008 08:48 AM
The goal of entrepreneurship is not simply to find the next big thing to lure venture capital or make a mad dash to a public offering. It is to create a venture that creates income and wealth for the entrepreneur and allows the entrepreneur to pursue other goals in life through this economic activity, be it creating more jobs in a better place to work, offering a better product to the customer, or making the world a little better place. The goal of entrepreneurship should be to build a good business -- with legs -- that will help build this entrepreneurial economy.

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Brian Dowling's Bookmarks tagged creative-destruction → View Popular

A Reporter at Large: Big Foot: newyorker.com

Once the World's Great Factory, China Is the Next Great Innovator

YouTube - Facing the Future:Critical Thinking on Global Sustainability

Joseph Alois Schumpeter, Biography: The Concise Encyclopedia of Economics: Library of Economics and Liberty

Rediscovering Schumpeter: The Power of Capitalism — HBS Working Knowledge

Creative Destruction's Reconstruction: Joseph Schumpeter Revisited - ChronicleReview.com

Open Innovation

Mill, Principles of Political Economy, Book II, Chapter XV: Library of Economics and Liberty

Information Arbitrage: Creative Destruction: Solving Problems through Innovation

When Your Product Becomes a Commodity — HBS Working Knowledge

Two Views of Innovation, Colliding in Washington - New York Times

Seth's Blog: Music lessons

Music lessons

David Byrne's Survival Strategies for Emerging Artists — and Megastars

Confusing Means and Ends

Economist's View: Robert Solow on Joseph Schumpeter

Creative Destruction: How Globalization Is Changing

Welcome to the Other Canon

The Upside of Down - The Argument

SustainAbility

CreativeDestruction.pdf (application/pdf Object)

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