Abstract
Bankruptcy plays an important role in free market economies. It is one of the processes of “creative destruction,” to use the term that Schumpeter made famous. Shifts in consumption patterns as well as increasing efficiencies in production processes tend to discipline risk-takers betting on past economic trends. In the more extreme cases, bankruptcy becomes a significant enforcer of the mechanisms of the free market.
Economic construction proceeds in wave-like fashion with its ups and downs, and one wave chasing another. This is to say that there are balance, disruption, and balance restored after disruption.
—Mao Zedong1
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Notes
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© 2012 Mark A. DeWeaver
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De Weaver, M.A. (2012). Suppressing “Blind” Investment. In: Animal Spirits with Chinese Characteristics. Palgrave Macmillan, New York. https://doi.org/10.1057/9781137110121_8
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