Choice in Schumpeter’s Capitalism, Socialism, and Democracy

Posted by on Oct 29, 2011 in Musings | No Comments

Joseph Schumpeter’s Capitalism, Socialism, and Democracy is his most widely-read book. In it, he predicts capitalism’s destiny, concluding that under a parliamentary democracy, it will inevitably wilt under the influence of regulations and the anti-capitalist intellectual climate it spawns. Ultimately, Schumpeter observes, a flowering of social democracies will rise out of the ashes of western capitalism. In Part II of his book, under a section titled, “The Civilization of Capitalism,” Schumpeter notes the following about choice:

“[H]owever, whether favorable or unfavorable, value judgments about capitalist performance are of little interest. For mankind is not free to choose. This is not only because the mass of people are not in a position to compare alternatives rationally and always accept what they are being told. There is a much deeper reason for it. Things economic and social move by their own momentum and the ensuing situations compel individuals and groups to behave in certain ways whatever they may wish to do–not indeed by destroying their freedom of choice but by shaping and choosing mentalities and by narrowing the list of possibilities from which to choose.” (129-130, Harper & Row: 1975).