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Heterogeneity of habits as a foundation for Schumpeterian economic policy

Author

Listed:
  • Markus C. Becker

    (University of Southern Denmark)

  • Thorbjørn Knudsen

    (University of Southern Denmark)

Abstract

In this paper, we highlight the heterogeneity of agents in Schumpeter’s theory. Because of its centrality in Schumpeter’s theory, we argue that agent heterogeneity should also be a key element for economic policy informed by Schumpeter’s theory. Schumpeter considered agents’ habits as a particularly important source of heterogeneity. We show how Schumpeter’s notion of habits is closely related to modern work on habits, and draw on recent research to elaborate theory that can provide the foundation for Schumpeterian economic policy. We argue that heterogeneity of habits can be a crucial building block and foundation of Schumpeterian economic policy: it offers a target for policy interventions that is different from incentives or information. This target is potentially as powerful as incentives or information, which only influence intentions rather than influencing behavior directly.

Suggested Citation

  • Markus C. Becker & Thorbjørn Knudsen, 2017. "Heterogeneity of habits as a foundation for Schumpeterian economic policy," Journal of Evolutionary Economics, Springer, vol. 27(1), pages 43-62, January.
    • Handle: RePEc:spr:joevec:v:27:y:2017:i:1:d:10.1007_s00191-016-0463-7
    DOI: 10.1007/s00191-016-0463-7
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    References listed on IDEAS

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    Cited by:

    1. Steve Fleetwood, 2021. "A definition of habit for socio-economics," Review of Social Economy, Taylor & Francis Journals, vol. 79(2), pages 131-165, April.

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    More about this item

    Keywords

    Habits; Heterogeneity; Economic policy; Schumpeter;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • B15 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Historical; Institutional; Evolutionary
    • B25 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Historical; Institutional; Evolutionary; Austrian; Stockholm School
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • B31 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - Individuals

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