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Home > QFINANCE Dictionary > Definition of creative destruction

Definition of

creative destruction

Mergers & Acquisitions

process of new firms and products replacing old a way of describing the endless cycle of innovation, which results in established goods, services, or organizations being replaced by new models. The term was first mentioned by Joseph Schumpeter in Capitalism, Socialism and Democracy (1942), but used heavily during the dot-com boom of the late 1990s and early 2000s.

Recommended Further Reading (Term count)
  • The Age of Turbulence: Adventures in a New World
    Alan Greenspan (2007)
    Tells the story of Greenspan’s early life, his professional career and his chairmanship of the Federal Reserve Board. Details why he thinks the global economy has evolved into a new and turbulent system over the last few years. Explains the dynamics behind recent world events through the perspective of his career and experiences.
  • Lessons from the Current Crisis
    by Jagdish Bhagwati
    Jagdish Bhagwati is University Professor, Economics and Law, at Columbia University and Senior Fellow in International Economics at the Council of Foreign Relations. One of the world’s leading economists today, he writes frequently in the leading newspapers and magazines.
  • Joseph Schumpeter
    Economist, and political scientist
    Joseph Schumpeter was an influential economist, classical liberalist, and political scientist, whose research on economic analysis, capitalism, business cycles, and entrepreneurship were central to the development of economic theory in the first half of the 20th century. He was Austrian minister of finance during a period of hyperinflation–which caused his dismissal–before turning to banking. As president of Biederman Bank, he made and lost a...

Definitions of ’creative destruction’ and meaning of ’creative destruction’ are from the book publication, QFINANCE – The Ultimate Resource, © 2009 Bloomsbury Information Ltd. Find definitions for ’creative destruction’ and other financial terms with our online QFINANCE Financial Dictionary.

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