Rafik Hariri Professor of the Practice of International Political Economy
We show that world trade network datasets contain empirical evidence that the dynamics of innovation
in the world economy follows indeed the concept of creative destruction, as proposed by J.A. Schumpeter
more than half a century ago. National economies can be viewed as complex, evolving systems, driven by
a stream of appearance and disappearance of goods and services. Products appear in bursts of creative
cascades. We find that products systematically tend to co-appear, and that product appearances lead to
massive disappearance events of existing products in the following years. The opposite – disappearances
followed by periods of appearances – is not observed. This is an empirical validation of the dominance
of cascading competitive replacement events on the scale of national economies, i.e. creative destruction.
We find a tendency that more complex products drive out less complex ones, i.e. progress has a direction.
Finally we show that the growth trajectory of a country’s product output diversity can be understood
by a recently proposed evolutionary model of Schumpeterian economic dynamics.
Klimek, Peter, Ricardo Hausmann, and Stefan Thurner. "Empirical Confirmation of Creative Destruction from World Trade Data." HKS Faculty Research Working Paper Series and CID Working Papers (RWP12-022 and 238), May 2012.