Entrepreneurship and growth: lessons from an intellectual journey

Philippe Aghion

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This lecture is the story of an intellectual journey, that of elaborating a new—Schumpeterian—theory of economic growth. A theory where (i) growth is generated by innovative entrepreneurs; (ii) entrepreneurial investments respond to incentives that are themselves shaped by economic policies and institutions; (iii) new innovations replace old technologies: in other words, growth involves creative destruction and therefore involves a permanent conflict between incumbents and new entrants. First, we motivate and then lay out the Schumpeterian paradigm and point to a set of empirical predictions which distinguish this paradigm from other growth models. Second, we raise four debates on which the Schumpeterian approach sheds new light: the middle income trap, secular stagnation, the recent rise in top income inequality, and firm dynamics. Third and last, we show how the paradigm can be used to think (or rethink) about growth policy design. (This article is based on the author’s presentation at the Global Award for Entrepreneurship Research ceremony in Stockholm, Sweden, May 10, 2016.)

Keywords: entrepreneurship; creative destruction; R&D; entry; exit; competition; technology frontier; firm dynamics (search for similar items in EconPapers)
JEL-codes: O10 O11 O12 O30 O31 O33 O4 O47 (search for similar items in EconPapers)
Date: 2016-12-06
New Economics Papers: this item is included in nep-cse, nep-gro, nep-ino and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published in Small Business Economics, 6, December, 2016, 48(1), pp. 9-24. ISSN: 0921-898X

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Journal Article: Entrepreneurship and growth: lessons from an intellectual journey (2017)
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