Post by jeffolie on Dec 8, 2012 17:10:44 GMT -6
The BIG Apple vs Austrian 'creative destructionism'
Notice that this chart omits companies such as IBM, Microsoft, SamSung, etc ... still there is a story one could imagine: Creative Destructionism
Destroying entrenched Tech companies which become big enough gain from momentum and size as the " go to seller" for corporations 'buyers' who fear buying tech from smaller, less proven manufacturers.
For example ... IBM
During the 1980s and into the 1990s, corporations and govts purchased IBM operating systems inside IBM computers without fear of criticism that the buyers paid too much.
Out with IBM and IN with IBM clones resulted in the destruction of the cronyism between IBM with corporate buyers and govt.
For example ... RIM [Blackberry]
Until just a few years ago, all the handheld 'communications devices' generally purchased by cronyism relationships were Blackberries.
For example .... Apple [iphones]
Anderoid based operating systems such as the Samsung phones now outsell Apple iphones.
my jeffolie view: the marketplace in tech remains so competitive that Apple will be crushed within 5 years most likely just as all other market dominating tech companies have fallen.
www.ritholtz.com/blog/wp-content/uploads/2012/12/APPLES.jpg
What is the economic concept of "Creative Destructionism"?
" ... later taken up as a major doctrine of the so-called Austrian School of free-market economic thought ... "
my jeffolie view: 'creative destructionism' relabelled the concepts that capitalism triumphs from ending cronyism during depressions which allow new technological eras to emerge which other wise would have been crushed by the cronyism of entrenched corporations with govt. best attributed to Nikolai Kondratieff; however, most commonly now attributed to Joseph Schumpeter. As applied to individual industries, one could understand the end of the making of carriages pulled by horses, the end of the industry of harvesting ice from rivers to keep food cold, etc. As applied to company segments, one could imagine the shift to smart phones away from landlines; or the shift away from PCs to other platforms such as tablets and smartphones. As applied to individual companies, brick and mortar Compusa or many other retails perished to be reborn as internet stores.
=========================
from Wikipedia:
" ... Joseph Schumpeter
The expression "creative destruction" was popularized by and is most associated with Joseph Schumpeter, particularly in his book Capitalism, Socialism and Democracy, first published in 1942. Already in his 1939 book Business Cycles, he attempted to refine the innovative ideas of Nikolai Kondratieff and his long-wave cycle which Schumpeter believed was driven by technological innovation. Three years later, in Capitalism, Socialism and Democracy, Schumpeter introduced the term "creative destruction", which he explicitly derived from Marxist thought (analysed extensively in Part I of the book) and used it to describe the disruptive process of transformation that accompanies such innovation:
Capitalism [...] is by nature a form or method of economic change and not only never is but never can be stationary. [...] The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers’ goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates. [...] The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial mutation [...] 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.
In Schumpeter's vision of capitalism, innovative entry by entrepreneurs was the disruptive force that sustained economic growth, even as it destroyed the value of established companies and laborers that enjoyed some degree of monopoly power derived from previous technological, organizational, regulatory, and economic paradigms. However, Schumpeter was pessimistic about the sustainability of this process, seeing it as leading eventually to the undermining of capitalism's own institutional frameworks:
In breaking down the pre-capitalist framework of society, capitalism thus broke not only barriers that impeded its progress but also flying buttresses that prevented its collapse. That process, impressive in its relentless necessity, was not merely a matter of removing institutional deadwood, but of removing partners of the capitalist stratum, symbiosis with whom was an essential element of the capitalist schema. [... T]he capitalist process in much the same way in which it destroyed the institutional framework of feudal society also undermines its own.
Schumpeter nevertheless elaborated the concept, making it central to his economic theory, and it was later taken up as a major doctrine of the so-called Austrian School of free-market economic thought.[citation needed]
en.wikipedia.org/wiki/Creative_destruction
Notice that this chart omits companies such as IBM, Microsoft, SamSung, etc ... still there is a story one could imagine: Creative Destructionism
Destroying entrenched Tech companies which become big enough gain from momentum and size as the " go to seller" for corporations 'buyers' who fear buying tech from smaller, less proven manufacturers.
For example ... IBM
During the 1980s and into the 1990s, corporations and govts purchased IBM operating systems inside IBM computers without fear of criticism that the buyers paid too much.
Out with IBM and IN with IBM clones resulted in the destruction of the cronyism between IBM with corporate buyers and govt.
For example ... RIM [Blackberry]
Until just a few years ago, all the handheld 'communications devices' generally purchased by cronyism relationships were Blackberries.
For example .... Apple [iphones]
Anderoid based operating systems such as the Samsung phones now outsell Apple iphones.
my jeffolie view: the marketplace in tech remains so competitive that Apple will be crushed within 5 years most likely just as all other market dominating tech companies have fallen.
www.ritholtz.com/blog/wp-content/uploads/2012/12/APPLES.jpg
What is the economic concept of "Creative Destructionism"?
" ... later taken up as a major doctrine of the so-called Austrian School of free-market economic thought ... "
my jeffolie view: 'creative destructionism' relabelled the concepts that capitalism triumphs from ending cronyism during depressions which allow new technological eras to emerge which other wise would have been crushed by the cronyism of entrenched corporations with govt. best attributed to Nikolai Kondratieff; however, most commonly now attributed to Joseph Schumpeter. As applied to individual industries, one could understand the end of the making of carriages pulled by horses, the end of the industry of harvesting ice from rivers to keep food cold, etc. As applied to company segments, one could imagine the shift to smart phones away from landlines; or the shift away from PCs to other platforms such as tablets and smartphones. As applied to individual companies, brick and mortar Compusa or many other retails perished to be reborn as internet stores.
=========================
from Wikipedia:
" ... Joseph Schumpeter
The expression "creative destruction" was popularized by and is most associated with Joseph Schumpeter, particularly in his book Capitalism, Socialism and Democracy, first published in 1942. Already in his 1939 book Business Cycles, he attempted to refine the innovative ideas of Nikolai Kondratieff and his long-wave cycle which Schumpeter believed was driven by technological innovation. Three years later, in Capitalism, Socialism and Democracy, Schumpeter introduced the term "creative destruction", which he explicitly derived from Marxist thought (analysed extensively in Part I of the book) and used it to describe the disruptive process of transformation that accompanies such innovation:
Capitalism [...] is by nature a form or method of economic change and not only never is but never can be stationary. [...] The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers’ goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates. [...] The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial mutation [...] 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.
In Schumpeter's vision of capitalism, innovative entry by entrepreneurs was the disruptive force that sustained economic growth, even as it destroyed the value of established companies and laborers that enjoyed some degree of monopoly power derived from previous technological, organizational, regulatory, and economic paradigms. However, Schumpeter was pessimistic about the sustainability of this process, seeing it as leading eventually to the undermining of capitalism's own institutional frameworks:
In breaking down the pre-capitalist framework of society, capitalism thus broke not only barriers that impeded its progress but also flying buttresses that prevented its collapse. That process, impressive in its relentless necessity, was not merely a matter of removing institutional deadwood, but of removing partners of the capitalist stratum, symbiosis with whom was an essential element of the capitalist schema. [... T]he capitalist process in much the same way in which it destroyed the institutional framework of feudal society also undermines its own.
Schumpeter nevertheless elaborated the concept, making it central to his economic theory, and it was later taken up as a major doctrine of the so-called Austrian School of free-market economic thought.[citation needed]
en.wikipedia.org/wiki/Creative_destruction