When the development of cellophane let us have self-service shopping for meat and produce, it started a retailing revolution that economists call creative destruction.
Econlife Blog
https://econlife.com/2017/07/self-service-shopping-for-groceries/
Fact Questions
- Which corporation developed cellophane?
- By when had cellophane spread to more than half of all supermarket meat departments?
- How did cellophane change food packaging?
- Why did supermarkets need cellophane?
- As shown at econlife, each of the following was expressed in a magazine ad for cellophane during the 1940s or 1950s. Explain the message to the consumer:
- “Eye It before you Buy It”
- “BEST QUALITY MEATS INSPECTED BY YOU”
- “Cellophane NO ADMITTANCE TO GERMS”
The Economic Idea: Creative Destruction
Economist Joseph Schumpeter used the term creative destruction to describe how capitalism progresses. Seemingly contradictory, creative destruction just means that the new replaces the old. The process though can be much more complex than it first appears because industries vanish when new goods and services, new jobs, and new skills replace them. Just think typewriters to get the idea. Because we no longer use them, those typewriter factories are long gone. Instead, we have printers, computers, and word processing.
Activity Goal: Describe Examples of Creative Destruction
Procedure:
- Divide into small groups of 3-5 students.
- Appoint a group leader who will run your discussion, a scribe to note what you discuss, and a reporter who will share your conclusions with the class.
- Each group should do either “A” or “B.”
- Then regroup as a class to share your examples of creative destruction.
| A.
Select a recently created good or service. Identify what is no longer produced because of that good or service. List the jobs that might have been eliminated. List the new jobs that might have been created. Called “spillover,” decide if the good or service you named had a broader impact on the economy. |
B.
Create your own innovation. Identify what is no longer produced because of that good or service. List the jobs that might be eliminated. List the new jobs that might be created. Called “spillover,” decide how the good or service you named had a broader impact on the economy. |
Econlife Lesson Plan PDF Download
