Growth and Economic Cycles
Pp. 78-98 (21)
Maria Alejandra Madi
This chapter explores the foundations of some theories about economic
growth and business cycles by surveying influential works of political economy.
Firstly, we examine Adam Smith’s contribution to the study of the impacts of the
division and the specialization of labour on productivity and economic growth in the
context of free markets. Then, we present the contribution of Joseph Schumpeter to the
capitalist development based on cyclical innovations as structural changes in a longterm
process of creative destruction. Finally, we consider the more recent writings of
Hyman Minsky that examined the real-world of financial institutions and studied issues
connected with growth, business cycles and financial institutions.
Labour productivity, Innovative entrepreneurs, Financial fragility.
World Economics Association, State University of Campinas, Av. Angélica 1711, cj. 111, São Paulo, SP, Brazil