Complexity , Innovation , and Development
not adequately allowed for in Schumpeter ’ s model .” 42
Bonné maintained that Schumpeter reflected the characteristics of the Western world . 43 Although Schumpeter did not dwell much on the challenges of emerging countries , he offered a universal theory . Schumpeter sought to develop a comprehensive theory of economic sociology as reflected in the “ missing Chapter 7 ” that was excluded from subsequent editions of his book . 44 He thought his theory applied broadly to the “ economy , politics , social relations , the arts , science , and morality .” 45
Bonné advanced his own theory that in fact reflected much of Schumpeter ’ s thinking . He defined economic development as consisting of “ a series of economic activities causing an increase in the productivity of the economy as a whole and of the individual earner , and also an increase in the ratio of earners to total population ." 46 Bonné added new elements such as capital formation , incentives , market expansion , balanced ratio of population increase to economic growth , the use of modern technologies , and political and social regimes conducive to economic development . 47
His formulation shifted the locus of economic development from endogenous forces at the microeconomic level to wider macroeconomic considerations . It opened up the scope for national planning involving a larger role by state agencies . He noted that since “ development in underdeveloped countries is not a self-induced process generated from within , it needs a strong hand to guide and protect it — a function which , at least for a transitional period , will have to be performed by authorities .” 48 What was in question was not the role of authorities per se , but how the specific functions that they performed could help to facilitate innovation through the creation of new combinations . To the contrary , he outlined standard bureaucratic functions that were hardly supportive of the dynamic entrepreneurial function for economic development as provided by Schumpeter .
The most comprehensive rejoinder to Wallich was provided by Douglas Rimmer at University College Ghana in 1961 . By then , the planning paradigm and the exclusion of alternative approaches to economic development had been firmly established . 49 Rimmer returned to Nurkse ’ s work as the starting point and proceeded to question the basis upon which Wallich rejected the applicability of Schumpeter to emerging countries . He challenged Wallich ’ s view that emerging countries are primarily concerned with consumption .
42
Bonné , Studies in Economic Development , 251 .
43
For an assessment of the historical context of Schumpeter ’ s view of entrepreneurship , see A . Ebner , “ Schumpeterian Entrepreneurship Revisited : Historical Specificity and the Phases of Capitalist Development ,” Journal of the History of Economic Thought 28 ( 3 ) ( 2006 ), 314 – 332 .
44
H . Peukert , “ Schumpeter ’ s ‘ Lost ’ Seventh Chapter : A Critical Overview ,” Industry and Innovation 9 ( 1 / 2 ) ( 2002 ): 79 – 89 ; and Y . Shionoya , “ The Origin of the Schumpeterian Research Program : A Chapter Omitted from Schumpeter ’ s Theory of Economic Development ,” Journal of Institutional and Theoretical Economics 146
( 2 ) ( 1990 ), 314 – 327 .
45
Y . Shionoya , Schumpeter and the Idea of Social Science ( Cambridge : Cambridge University Press , 1997 ), 32 .
46
Bonné , Studies in Economic Development , 252 .
47
Ibid ., 255 – 256 .
48
Ibid ., 258 .
49
See Rimmer , “ Schumpeter and the Underdeveloped Countries ,” 422 – 450 .
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