Joel Mokyr is known for his work examining the long-term effects of technological progress from a historical perspective. Focusing especially on the productivity increases observed in Western Europe after the Industrial Revolution, Mokyr analyzed not only the technological developments themselves but also the social, cultural, and institutional structures that enabled them. He views innovation not merely as an engineering or scientific advancement, but as a process intertwined with access to knowledge, education, culture, and entrepreneurship.
Philippe Aghion and Peter Howitt made a significant breakthrough in economic growth theory with their 1992 development of the "creative destruction" model. This theory expanded on the ideas first introduced by Joseph Schumpeter in the mid-20th century, evolving them into a dynamic model of economic growth.
Creative destruction describes the process by which new ideas and technologies replace old production methods and business models with more efficient and innovative alternatives. In Aghion and Howitt’s model, as entrepreneurs and firms develop better products and processes, productivity in the economy increases. However, this innovation process also leads to the obsolescence of existing firms, technologies, and employment structures. Thus, growth occurs within a continuous cycle of renewal and competition.
Their model emphasizes that economic growth is not simply about producing more, but about finding newer, more innovative, and more efficient ways to produce. It also highlights the crucial role of public policy particularly in education, R&D support, and competition regulation in accelerating or slowing down this process.
