Entrepreneurship & the Spirit of Creative Destruction

By Kofi Bentil

kofi bentilIn a fascinating course brimming with insights ranging from the philosophical to the practical, Mr. Bentil guides participants through a maze of ideas leading to the breathtaking vision of ‘’revolutionary’’ capitalism once drawn up by the renowned economist, Schumpeter.

To summarize Schumpeter’s perspective on modern capitalism crudely: the visionary economist believed that the traditional ‘’systems’’ of economic transformation such as the ‘’Smithian’’ (the theories of Adam Smith), ‘’the Keynesian’’ (the views of John Maynard Keynes’’) etc. were all incomplete or even plain flawed!

Economic change does not occur in ‘’smooth gradation’’, but rather through a series of abrupt breaks with the existing ‘’paradigm’’. Participants who are literate in the sciences will see a resemblance to various ‘’catastrophe’’ theories of evolution, and to the ideas of Rene Thom in mathematics.

What makes Schumpeter’s vision of change differ from similarly radical conceptions in the history of ideas, such as for instance those of Thomas Kuhn, is that he not only believes that abrupt, wholesale, ‘’paradigm shifts’’ occur during economic transformation, but also that these shifts wipe away most of what preceded them. To quote the poet T.S. Elliot, ‘’all that is solid melts into air’’.

Therefore we are seeing a new entrepreneurial wave sweeping across Asia . China has in recent years been posting a trade surplus with the United States in the region of $200 billion: over twenty times the total national output of countries like Ghana – and that’s the surplus! Accompanying this process, large volumes of economic production are shifting from the West to Asia, prompting other comparisons such as the contrast between the savings hoard that has made China the world’s largest holder of foreign currency and the debt crisis currently ripping through sections of the USA ’s economy.

Back home on our beloved continent of Africa, local industries are crumbling, as a new breed of entrepreneurs, with hitherto unimaginable access to global information, opens trading corridors to Dubai in the Middle East and Guandong on the Chinese coast. Business models that have long served business elites in Ghana , for instance, ranging from asset-backed financing to intensive poultry rearing, are being bulldozed aside as novel forms of securities trading and private equity trusts make their debut on the Accra financial markets and coastal farmers switch to organic and horticultural farming in droves.

What else will be swept away in this blaze of ‘’transformation’’? Who will survive, and how? How will old elites react to the threats to their longstanding dominance? What enterprises will emerge across the developing world to ridicule ancient understandings about ‘’what works’’ in poor societies. How will the African continent fare in this latest episode of tectonic change?

Please see Mr. Bentil’s power point presentation here. Express permission for citing any of Mr. Bentil’s works should be sought from Franklin Cudjoe franklin@imanighana.org Editor, African Liberty & Executive Director, IMANI.