IDEAS home Printed from
   My bibliography  Save this paper

Business Cycles, Growth and Economic Policy: Schumpeter and the Great Depression


  • Muriel Dal-Pont Legrand

    Université Nice Sophia Antipolis)

  • Harald Hagemann

    (University of Hohenheim, Stuttgart)


Joseph A. Schumpeter’s theory of economic development analyzes how growth and cycle dynamics intertwine. The process of Creative Destruction plays an essential role in that dynamics: embodying a cleaning effect, it has a clear beneficial impact on long-run development. For that reason, and also for some of his famous (and provocative) non-interventionists statements, Schumpeter is generally interpreted as a pure liquidationist. This paper contests this rather simplistic view and shows that Schumpeter not only expressed much more nuanced positions as far as practical economic issues were concerned but also that his views on economic policy were rooted in his earlier contributions before the Great Depression, attesting to a stronger time-consistency of his contributions.

Suggested Citation

  • Muriel Dal-Pont Legrand & Harald Hagemann, 2016. "Business Cycles, Growth and Economic Policy: Schumpeter and the Great Depression," GREDEG Working Papers 2016-16, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France, revised Jul 2016.
  • Handle: RePEc:gre:wpaper:2016-16

    Download full text from publisher

    File URL:
    File Function: Revised version, 2016-07
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. Muriel Dal-Pont Legrand & Hagemann Harald, 2007. "Business cycles in Juglar and Schumpeter," Post-Print halshs-00454505, HAL.
    2. Harald Hagemann, 2003. "Schumpeter's early contributions on crises theory and business-cycle theory," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 11(1), pages 47-67.
    3. Rostow, W. W., 1975. "Kondratieff, Schumpeter, and Kuznets: Trend Periods Revisited," The Journal of Economic History, Cambridge University Press, vol. 35(4), pages 719-753, December.
    4. Mauro Boianovsky & Hans-Michael Trautwein, 2010. "Schumpeter on unemployment," Journal of Evolutionary Economics, Springer, vol. 20(2), pages 233-263, April.
    5. Harald Hagemann, 2009. "Schumpeter on Development," Chapters, in: Yuichi Shionoya & Tamotsu Nishizawa (ed.),Marshall and Schumpeter on Evolution, chapter 11, Edward Elgar Publishing.
    6. Paul Samuelson, 2015. "The Harvard-Circle," Journal of Evolutionary Economics, Springer, vol. 25(1), pages 31-36, January.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Farrell, Katharine N. & Löw Beer, David, 2019. "Producing the ecological economy: A study in developing fiduciary principles supporting the application of flow-fund consistent investment criteria for sovereign wealth funds," Ecological Economics, Elsevier, vol. 165(C), pages 1-1.

    More about this item


    Business cycles; growth; short run; long run; creative destruction; cleansing effect; productive recessions; economic policy; Schumpeter;

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • B31 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - Individuals

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gre:wpaper:2016-16. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Patrice Bougette). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.