Joseph A. Schumpeter, Historian of Economics

Joseph A. Schumpeter, Historian of Economics

Joseph A. Schumpeter, Historian of Economics

Joseph A. Schumpeter, Historian of Economics


Joseph A. Schumpeter was one of the great economists of the 20th century. His History of Economic Analysis is perhaps the greatest contribution to the history of economics. This book examines his writings and ideas.


American economists appear in only bit parts in Schumpeter’s History of Economic Analysis. There is little mystery about why this should be so: Their nation’s experience is but an eyelash flicker in the sweep of the recorded history with which Schumpeter dealt. But he might reasonably have slighted Americans for another reason. the conventional wisdom—as articulated, for example, by Harvard’s Charles F. Dunbar at the time of the 1876 centennial—held that the United States had produced no contributors to the world’s stock of fundamental economic ideas (Barber 1993:11).

What Schumpeter had to say about American economics nonetheless merits inspection. His observations—even at their most idiosyncratic—are provocative and worthy of consideration on their individual terms. But there is a broader rationale for this exercise. An examination of his choices for inclusion (or exclusion) and his appraisals of the American economists he elected to treat may also enrich our understanding of his intellectual style.

To set the stage, a distinction needs to be drawn between the history of economic analysis, on the one hand, and the history of economic thought, on the other. Schumpeter himself promoted this distinction (Schumpeter 1954:12-24). If one were to judge solely by the title of his treatise, it would readily follow that its contents should concentrate exclusively on economists who had shaped the discipline’s analytic apparatus. a work drawn to such specifications would presumably focus on those who augmented its theoretical core. Within these terms of reference, thinkers who had stirred waves in their lifetimes, but who had left no lingering legacy, should properly be ignored.

In fact, however, the History of Economic Analysis is a methodological and organizational hybrid. At times, he writes as a historian of analysis. For simplicity, that posture will be characterized hereafter as Schumpeter wearing “Hat I.” But at other times, he writes as a historian of thought, as is the case when he appraises the works of challengers to mainstream doctrine who would have no claim on space in a pure history of analysis. Schumpeter in that mode will henceforth be characterized as wearing “Hat ii.”

To add force to this distinction, it is useful to reflect on the American

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