Technology doesn’t just change things, it utterly destroys things. And that’s just fine. It happens so often that people barely even notice when it does. Think about all the new services that have come to market just over the past few years: Uber, Airbnb, Redbox … the list goes on and on.
But that’s only half the story. In turn, the list of services replaced by these new ones is similarly long: taxis, hotels, Blockbuster, etc. And workers in these industries often lose their jobs in the line of creative destruction. We generally accept this as the price of innovation, but many people try to use the government to stop this by blocking the new services.
Today we're seeing this with more politically well-connected industries like taxis and hotels. Pressure is put on Uber and Airbnb, respectively, to “protect” the established industries they are upending. This week, Ant and James talk about why this is always a mistake.
For more about creative destruction, visit:
As the Economy Changes, Hold the Regulations
Half a Century Later, Economist's "Creative Destruction" Theory Is Apt for the Internet Age
Joseph Schumpeter: The "Father" of Capitalist "Creative Destruction"
Unleash the Market's Creative Destruction
The "Amazon Effect" Is Creative Destruction at Its Finest
Creative Destruction Is Winning the Shopping Battle
The Creative Destruction of New York in 47 Seconds
Creative Destruction Is Not Zero-Sum
Peace Out, iPod, I'm Rocking Spotify
Capitalism Destroys Jobs, and That's a Good Thing
Don't Call it Creative Destruction, Call it Creative Renewal
Antony Davies
Dr. Antony Davies is an Associate professor of Economics at Duquesne University, and co-host of the podcast, Words & Numbers.
James R. Harrigan
James R. Harrigan is a Senior Editor at the American Institute for Economic Research. He is also co-host of the Words & Numbers podcast.