Schumpeterian Growth Theory

Schumpeterian Growth Theory emphasizes that economic progress primarily results from innovation and entrepreneurship. Entrepreneurs introduce new products, technologies, or methods, which can disrupt existing markets—a process called "creative destruction." This continual cycle of innovation drives productivity, economic development, and upward growth over time. Rather than steady, incremental improvements, growth comes from significant breakthroughs that reshape industries. The theory highlights the importance of innovative entrepreneurs and competitive markets in fostering sustained economic advancement.