Quotation of the Day…

by Don Boudreaux on May 26, 2014

in Agriculture, Competition, Complexity & Emergence, Creative destruction

… is from page 31 of Israel Kirzner’s superb 1997 monograph, How Markets Work: Disequilibrium, Entrepreneurship and Discovery:

The theory of entrepreneurial discovery sees the explanation of market phenomena in the way entrepreneurial decisions, taken under disequilibrium conditions, bring about changes in prices and quantities.  The market process so initiated consists of continual entrepreneurial discoveries; it is a process of discovery driven by dynamic competition, made possible by an institutional framework which permits unimpeded entrepreneurial entry into both new and old markets.  The success which capitalist market economies display is the result of a powerful tendency for less efficient, less imaginative courses of productive action, to be replaced by newly discovered superior ways of serving consumers – by producing better goods and/or by taking advantage of hitherto unknown, but available, sources of resource supply.

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