Joseph Schumpeter's prediction: will capitalism be replaced by socialism?

Abstract

Capitalism is a word which has come under heavy criticism in recent years and its demised has long been announced, although the capitalist economic system has ensured the economic supremacy of the West for over 500 years. Capitalist economies and systems such as those of the United States continue to be the strongest in the world, at least until 2050, when it might be overtaken by the Chinese economy. Even China, a follower of the "one country, two systems" principle, accepts the capitalist economy in some of its regions, where approximately 500 million Chinese work.
What will happen to capitalism? Will it fall apart? Will it be replaced by socialism? Such questions also concerned the great Austrian economist Joseph Schumpeter. In 1942 the Austrian economist dedicated an entire book to this subject: ”Capitalism, socialism and democracy”. His thesis is that the very success of capitalism undermines the social institutions that protect it and that inevitably create the conditions in which it will no longer be able to survive, pointing decisively in the direction of socialism as the heir apparent. In 1949, in New York, Schumpeter resumed the thesis with even greater force in the conference entitled ”The March into Socialism”, held before the American Economist Association.