The document discusses the concept of creative destruction, as introduced by economist Joseph Schumpeter, highlighting how innovations like the shift from analogue to digital photography create chaos and structural change in society. It uses the transformation of the camera industry, particularly the downfall of Kodak, as a key example of this phenomenon. The text emphasizes that economic progress often involves turmoil and challenges for existing firms, illustrating the cyclical nature of business innovations.

1. The Creative Destruction
of Photography

2. The Austrian economist Joseph Schumpeter coined
the term Creative Destruction.

3. The Austrian economist Joseph Schumpeter coined
the term Creative Destruction.
To Schumpeter, growth in a capitalist society
happened through the introduction of innovations,
which in turn create chaos and structural change in
society.

4. The Austrian economist Joseph Schumpeter coined
the term Creative Destruction.
To Schumpeter, growth in a capitalist society
happened through the introduction of innovations,
which in turn create chaos and structural change in
society.
The shift from analogue to digital photography is a
schoolbook example of creative destruction.

5. The Austrian economist Joseph Schumpeter coined
the term Creative Destruction.
To Schumpeter, growth in a capitalist society
happened through the introduction of innovations,
which in turn create chaos and structural change in
society.
The shift from analogue to digital photography is a
schoolbook example of creative destruction.
This presentation combines some quotes f
h b from
Schumpeter with images of how the camera industry
has been transformed.
h b f d

6. The images come from the former Kodak site
Th i f th f K d k it
outside of Stockholm, Sweden.

8. “Economists are at long last emerging from the stage in
which price competition was all they saw.…In capitalist
which price competition was all they saw In capitalist
reality…it is not that kind of competition which counts but
the competition from the new commodity, the new
p y,
technology, the new source of supply, the new type of
organization

10. …competition which…strikes…existing firms…at their
foundations and their very lives. This kind of competition
is…much more effective than the other…and [is]…the
powerful lever that in the long run expands output.”

11. The shift to digital imaging enabled people to take an
The shift to digital imaging enabled people to take an
infinite amount of photos at no cost, and made it much
easier to share them.

12. The shift to digital imaging enabled people to take an
The shift to digital imaging enabled people to take an
infinite amount of photos at no cost, and made it much
easier to share them.
But it did so by creating ugly, vandalized buildings like the
former Kodak site, where film used to be finished.

13. “The capitalist process, not by coincidence but by
The capitalist process, not by coincidence but by
virtue of its mechanism, progressively raises the
standard of life of the masses. It does so through a
sequence of vicissitudes, the severity of which is
proportional to the speed of the advance. But it
does so effectively. One problem after another of
d ff ti l O bl ft th f
the supply of commodities to the masses has been
successfully solved by being brought within the
successfully solved by being brought within the
reach of the methods of capitalist production.”

14. “New combinations are, as a rule embodied, as it were, in
e co b at o s a e, as a u e e bod ed, as t e e,
new firms which generally do not arise out of the old ones
but start producing beside them”

16. “It is by no means farfetched or paradoxical to say that
t s by o ea s a etc ed o pa ado ca to say t at
"progress" unstabilizes the economic world, or that it is by
virtue of its mechanism a cyclical process “

17. “Economic progress, in capitalist society, means turmoil.”

19. “Individual innovations imply, by virtue of their nature, a
“I di id l i i i l b i f h i
"big" step and a "big" change. A railroad through new
country, i.e., country not yet served by railroads, as soon as
country i e country not yet served by railroads as soon as
it gets into working order upsets all conditions of location,
all cost calculations, all production functions within its
, p
radius of influence; and hardly any "ways of doing things"
which have been optimal before remain so afterward.”

21. “Surely, nothing can be more plain or even more trite
common sense than the proposition that innovation…is at
p p
the center of practically all the phenomena, difficulties, and
problems of economic life in capitalist society. “

23. “Those revolutions are not strictly incessant; they occur in
discrete rushes which are separated from each other by
discrete rushes which are separated from each other by
spans of comparative quiet. The process as a whole works
incessantly however, in the sense that there always is either
revolution or absorption of the results of revolution, both
together forming what are known as business cycles.”

25. The former Kodak site serves as a pretty good illustration of
this quote from Schumpeter:

26. The former Kodak site serves as a pretty good illustration of
this quote from Schumpeter:
“It is not the owner of stage‐
coaches who builds railways.”

27. Summing up, Schumpeter suggested that growth is
often associated with a rather ugly and unpleasant
process for many actors.

28. Put differently by a decoration inside the Kodak building:

30. Christian Sandström is a PhD
student at Chalmers
student at Chalmers
University of Technology in
Gothenburg, Sweden. He
Gothenburg, Sweden. He
writes and speaks about
disruptive innovation and
technological change.
Find out more about Kodak and digital imaging:
www.christiansandstrom.org