KNOWLEDGE, PHYSICAL CAPITAL AND CREATIVE DESTRUCTION

Edmund Cannon

Nuffield College, Oxford University

 

February 1996

 

Abstract

''Creative destruction'' refers to the way that economic advances make existing economic capital and ideas obsolescent: they are partially destroyed (in value terms). Existing models have only considered how additions to economic knowledge make existing knowledge less valuable. This paper recognises that both knowledge and capital obsolesce and considers the effect on both.