![]() The sources and dynamics of inequality are interesting to study, as one source of inequality is innovation.People use the idea that Argentina may have been doing well up to a certain point, but then stopped doing as well. The middle income trap is well exemplified in Argentina, as between 18, the per capita GDP remained at a constant ratio with the US, but declined since then.We may need to adopt competition police in the digital era. Aghion suggests that the IT revolution favored the development of superstar firms. Measurement tends to explain why we underestimate growth and overestimate inflation, but does not explain more than 10% of the decline in growth. Possible explanations can be drawn from the fact that growth occurred at different times for IT producing and IT using sectors. Secular stagnation can be viewed by looking at the rise and decline of TFP Growth, especially at the times of the IT and the AI revolutions.It did not occur in China because of creative destruction caused by the emperor. This is because of institutions that would favor cumulative innovation such as printing, postage services, and the encyclopedia, encouraging people to build knowledge. Industrial take off never lasted for a long time, but in 1820 the major take off occurred in Europe.The book uses the lens of creative destruction to revisit these enigmas, question common wisdoms, and rethink the future of capitalism. Some historical enigmas are discussed in the book: industrial take off, secular stagnation, middle income traps, and sources and dynamics of inequality.The book is about why Schumpeter’s pessimistic prophecy is untrue, and advocates for an “optimism of the will.” ![]() The contradiction: innovators are motivated by monopoly rents, but those rents can be used ex post to prevent future innovations and block new entry. Basic “Schumpeterian growth” paradigm is based on the fact that long-run growth is driven by the cumulative process of innovation, innovations resulting from entrepreneurial activities motivated by the prospect of innovation rents, and creative destruction. Creative destruction is the process whereby new innovations displace old technologies. ![]()
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