On knowledge and economic transformation: Joseph Schumpeter and Alfred Marshall on the theory of restless capitalism

Joseph Schumpeter and Alfred Marshall pioneered the study of innovation and entrepreneurship as key forces of economic development. This article offers an overview of key ideas developed by these influential economists in works published between 1890 and 1944. We argue that while our own time presents a partly different set of challenges, opportunities and institutional conditions than those of that age, many insights championed in their work remain highly relevant for our time and day. Noting how analysis of markets is relatively absent from some of the strands of contemporary innovation research, we suggest that re-visiting the foundational work of Schumpeter and Marshall can help stimulate deep insights relevant to societal transformation and the potential role of technical innovations.