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Schumpeter's price theory

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Open access
Authors
Bloch, Harry
Date
2009
Type
Conference Paper

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Citation
Bloch, Harry. 2009. Schumpeter's price theory, in Gregory C G Moore (ed), The 22nd conference of the history of economic thought society of Australia, Jul 14 2009.Fremantle, Western Australia: The History of Economic Thought Society of Australia
Source Title
HETSA 2009 abstracts and full papers
Source Conference
The 22nd conference of the history of economic thought society of Australia
Faculty
Curtin Business School
School of Economics and Finance
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Abstract

Schumpeter distinguishes between the circular flow of economic activity and economic development. The former is characterised by equilibrium, while the latter involves discontinuous change. The price theory that Schumpeter associates with the circular flow is the well established Walrasian price system. However, the price theory which Schumpeter proposes for economic development is only partially developed in writings and has been largely ignored since. Yet, it is the analysis of economic development that constitutes Schumpeter's enduring contribution to economic thought. This paper provides a critical examination of Schumpeter's price theory as it applies when there is economic development.