Journal of Evolutionary Economics

, Volume 28, Issue 5, pp 1175–1198 | Cite as

The finance/innovation nexus in Schumpeterian analysis: theory and application to the case of U.S. trustified capitalism

  • Beniamino Callegari
Regular Article


Joseph Schumpeter built his theory of economic development around the interaction between the entrepreneur and the banker, representations of the underlying finance/innovation nexus. The neo-Schumpeterian revival has marginalized this theoretical element, in favor of an interpretation focused primarily on technological aspects of innovation. Recent attempts by innovation scholars to re-integrate the missing financial elements have been hindered by this theoretical gap. The purpose of this paper is to contribute to the recovery of the finance/innovation nexus in the context of Schumpeter’s theory by proposing an original institutional interpretation of the relationship between finance and the entrepreneurial function. The new approach identifies the economic role of innovation as dependent on the contextual form taken by the related funding process. Application of these concepts to the U.S. trustified capitalism experience allows for an alternative interpretation linking corporate internalization of innovation and financial repression. A Schumpeterian trilemma involving monetary capitalism, financial autonomy of the corporate sector and financial stability is revealed. The proposed framework provides a flexible theoretical background for the development of our understanding of the current capitalist regime, open to further integration with other schools of economic thought.


Innovation Financial institutions Trustified capitalism Institutional economics Joseph Schumpeter Hyman Minsky 

JEL Classification

B25 B52 E02 N22 



The author wishes to thank those participating in the 16th International Schumpeter Society Conference in Montreal, especially Cristiano Antonelli and Harry Bloch. The usual caveats apply.

Compliance with ethical standards

Conflict of interest

The author declares that he has no conflict of interest.


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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.BI – Norwegian Business SchoolOsloNorway

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