Capitalist Entrepreneurship: Making Profit Through the Unmaking of Economic Orders

28 Pages Posted: 30 Jan 2013

See all articles by Thorbjorn Knudsen

Thorbjorn Knudsen

University of Southern Denmark - Department of Marketing & Management - Strategic Organization Design Unit (SOD)

Richard Swedberg

Cornell University - Department of Sociology

Abstract

This is a theoretical paper in which we attempt to present an economic and sociological theory of entrepreneurship. We start from Schumpeter's idea in Theory of Economic Development that the economy can be conceptualized as a combination and innovations as new combinations. Schumpeter also spoke of resistance to entrepreneurship. By linking the ideas of combination and resistance, we are in a position to suggest a theory of capitalist entrepreneurship. An existing combination, we propose, can be understood as a social formation with its own cohesion and resistance – what may be called an economic order. Actors know how to act; and profit is low and even in these orders. Entrepreneurship, in contrast, breaks them up by creating new ways of doing things and, in doing so, produces entrepreneurial profit. This profit inspires imitators until a new order for how to do things has been established; and profit has become low and even once more. Entrepreneurship is defined as the act of creating a new combination that ends one economic order and clears the way for a new one. The implications of this approach for a number of topics related to entrepreneurship are also discussed.

Comments on this paper can be found at: http://ssrn.com/abstract=2209392

Suggested Citation

Knudsen, Thorbjorn and Swedberg, Richard, Capitalist Entrepreneurship: Making Profit Through the Unmaking of Economic Orders. Capitalism and Society, Vol. 4, Issue 2, Article 3, 2009, Available at SSRN: https://ssrn.com/abstract=2209371

Thorbjorn Knudsen (Contact Author)

University of Southern Denmark - Department of Marketing & Management - Strategic Organization Design Unit (SOD) ( email )

Faculty of Social Sciences
Campusvej 55
DK-5230 Odense
Denmark

HOME PAGE: http://www.sdu.dk/sod

Richard Swedberg

Cornell University - Department of Sociology ( email )

328 Uris Hall
Ithaca, NY 14853
United States
607-255-4325 (Phone)

HOME PAGE: http://www.soc.cornell.edu/faculty/swedberg.shtml

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