Comment on Nathan Rosenberg, "Was Schumpeter a Marxist?"

Abstract

A leading and respected analyst of the dynamics of industrial capitalism, Nathan Rosenberg is doing economists an important service by reminding them that Joseph Schumpeter was a great admirer of Karl Marx (Rosenberg, 2011). What drew Schumpeter to Marx was, as Rosenberg states toward the beginning of his essay, the intellectual position that capitalism cannot be understood as a general equilibrium system of market exchange. What Marx and Schumpeter had in common was an intellectual approach to analyzing the economy that emphasized the role of technological change in the development process. And what makes both Schumpeter and Marx relevant today is that the economists whose thinking dominates the profession continue to conceive of the economic system as a general equilibrium of market exchange while they ignore the technological transformations that provide the foundations for economic development. A century after the publication of The Theory of Economic Development (Schumpeter, 1934), today's economists still have a lot to learn from Schumpeter—including some critical insights that Schumpeter got from Marx and a least one lesson that Schumpeter should have learned from Marx.