The Creative Economy

Adam Smith, the arch-capitalist, didn't like corporations. He wrote in 1776 in The Wealth of Nations that they breed "negligence and profusion" and "scarce ever fail to do more harm than good." In his day, governments handed out corporate charters rarely and grudgingly. But a century later, as the required scale of enterprise grew, corporations came to the fore. They built railroads, steel mills, refineries, and other businesses of unprecedented size. In so doing, they played an indispensable role in what University of California at Berkeley economist J. Bradford DeLong calls the "central fact" in 20th century economic history: the greatest increase in material wealth ever.

Now the Industrial Economy is giving way to the Creative Economy, and corporations are at another crossroads. Attributes that made them ideal for the 20th century could cripple them in the 21st. So they will have to change, dramatically. The Darwinian struggle of daily business will be won by the people--and the organizations-- that adapt most successfully to the new world that is unfolding.