Fifteen years after the Global Financial Crisis: Recessions and Business Cycles in the History of Economic Thought

The mixed economy as an inherently unstable halfway house: the gloomy aspects of Schumpeter’s post-WWII outlook and its background

Sturn Richard, Graz Schumpeter Centre, University of Graz,

Schumpeter’s aversion against Franklin D. Roosevelt and his politics is well-known and well-documented, and his reservations against the New Deal have been discussed from various perspectives. In this piece, I will reconsider some of those discussions in view of his theorizations on long-term socio-economic evolution, notably in view of different levels of backgrounds (analytic as well as “pre-analytic”) affecting his views on the comparative advantages of “pure” types of socio-economic systems (such as “classical” capitalism and “socialism”) vs. hybrid types (such as various forms of mixed economies evolving after WW II and providing frameworks for one of the most remarkable epochs of prosperity in the history of capitalism). This is complemented by some observations on ways in which Schumpeter sometimes does envisage and employ heterogeneous elements as systemically relevant complements of socio-economic systems, not least in terms of the moral and/or motivational framings of socio-economic systems. Apart from the tax state essay, Capitalism, Socialism, and Democracy and other politico-economic papers, pertinent passages from “Business Cycles” and unpublished notes accompanying the writing process of Capitalism, Socialism, and Democracy are taken into consideration.

Area: Eshet Conference

Keywords: Schumpeter, New Deal, Mixed economy, state, socialism

Please Login in order to download this file