'Fettered' and 'Unfettered' Capitalism in J.A. Schumpeter’s Concept of Tax State and Economic Development – Issues in Banking Perspective

Oeconomia Copernicana, 7(1), 23-33, 2015, DOI: http://dx.doi.org/10. 12775/OeC.2015.002

11 Pages Posted: 16 Apr 2015 Last revised: 21 Jun 2016

See all articles by Karol Śledzik

Karol Śledzik

University of Gdańsk - Faculty of Management

Date Written: march 15, 2016

Abstract

Economic development and transformation processes have become much more intense in economic reality in the last years than they have ever been before. At this time a lot of questions were raised about the causes of the actual Global Crisis, future crises, the factors affecting the modern economy, about the essence of contemporary capitalism, demographic problems and overgrown bureaucracy. The most spectacular threat to capitalism, (based on private entrepreneurship) according to Schumpeter, stems from the high, growing and progressive taxation. Schumpeter saw clearly that the financing of public goods and services (requiring taxes, maybe even relatively high) is something other than a clerical control of the economic system that violates the natural economic mechanism. Moreover, Schumpeter says explicitly that an entrepreneur does not have to be one person, he even states that the country (state) itself, or its agenda, can act as an entrepreneur. Therefore, it can be concluded that we may have to deal with “Tax State”, which is typical for “fettered capitalism”, and with “entrepreneurial state”, which is typical for “unfettered capitalism”. The main goal of this paper is to present two different approaches to the economic development concept: Schumpeter’s “fettered” and “unfettered” capitalism in the context of “Tax State” and interventionism. The Author analyzes presented concept in contemporary issues from the banking perspective. In the paper, the Author used critical analysis as a research method. This allowed to identify gaps in the current state of knowledge and the scientific discussion focused on J.A. Schumpeter’s theoretical concept. Analysis was performed in 2015.

Keywords: Schumpeter, capitalism, Tax State, economic development

JEL Classification: A13, B15, K20, P7, P20

Suggested Citation

Śledzik, Karol, 'Fettered' and 'Unfettered' Capitalism in J.A. Schumpeter’s Concept of Tax State and Economic Development – Issues in Banking Perspective (march 15, 2016). Oeconomia Copernicana, 7(1), 23-33, 2015, DOI: http://dx.doi.org/10. 12775/OeC.2015.002. Available at SSRN: https://ssrn.com/abstract=2594663 or http://dx.doi.org/10.2139/ssrn.2594663

Karol Śledzik (Contact Author)

University of Gdańsk - Faculty of Management ( email )

ul. Armii Krajowej 101, 81-824
ul. Bażyńskiego 1A,
Gdańsk, 80-952
Poland

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