The concept of “creative destruction” was created by the economist Joseph A. Schumpter, defined as a highlighter of the capitalist systems’ dynamic nature, stating that capitalism always renovates itself, through the creation of new things, new products, new concepts, structures and ideas that make the previous ones obsolete, i.e. the previous ones are destroyed. It states that capitalism stands on the basic dynamic relationship between the creation and destruction that create one another.
Given that this process is endogenous to capitalism itself, i.e. no outside sources cause it, but only the people (entrepreneurs and innovative people) inside the whole economic concept, and that the nature of such process is qualitative in the type of change it causes, it should be emphasized and kept conscious in the minds of those whose entrepreneurship and innovation make this happen that this can be used to create a competitive market, sustained on the basis of sustainability and that, if this is maintained, the creative destruction makes way not just to innovation, but also to consequent evolution and improvement of the economic sector and, in consequence of this, of the whole sociologic structure of a certain location (city, state, or country).
The concept of embeddedness designates the constraint degree applied to the economic activity by other institutions that are non-economic and it was created by Karl Polanyi, an economic historian, being part of the Substantivist theory he has created also. It is based on the idea that societies that are non-market ones, the economic institutions present are not pure ones, so that the formal economic models that are developed cannot be applied to such societies. On these cases, the “provisions” that economic activity produces and takes care of have been “embedded” in other fields of activity that are not the economical one, such as religious and political activity institutions. When in a market society, strict economic models are used and applied to its development, so that the economic activities, not only suffer a process of rationalization, but are also “disembedded” from society itself, having no relation with it or any other areas that concern it.
Based on such facts, a society that has a non-market structure will benefit from its “embeddedness” of economical activity with other fields, giving way to more possibilities on evolution and innovation, because the exchange of information between the economical and other fields gives this one an advantage of being more conscious of the sociological/economical needs of that society for it to be able to grow, along with the economical growth itself, maintaining a process of continuous “feeding” of one another: economic growth and innovation gives space and means for the sociological structure to evolve and this, on its turn, makes way to more areas in which economical growth can expand and innovate.
The existence of large cities and the development of Internet created networks that are informal and with loose traits, that enable connections, information spreading and fast developments. With this in mind and making an analogy with the concept of solids, liquids and gases and their nature, Steven Johnson has created the notion of “liquid networks”. According to the molecular structure of those solids, liquids and gases, he has stated that individuals within a society also oscillate around each other and because of each other and that the extent of free movement permitted was in an inverse relation with the conventionality and strictness of the office design models in which those people had to work – e.g. structure in cubicles, desktops, etc. In cases of a rigid structure, people are not allowed to move that much, analogous to what happens with solids, and this way it is not possible to influence one another. On the other hand, if in an environment with no boundaries, similar to a gas, there would be no order and chaos would rule; this is not productive either, with nothing but dissipation to the environment of any possible interaction and its influence. Steven Johnson then suggest the “liquid state” as the desirable one, where a basic structure is kept, but people are able to move within it and interact, in collective effort and collaboration, together with the ability of molding and adapting to any moment’s need, just like a liquid.
This way, usefulness is always maintained; furthermore, individuals develop their exaptation, i.e. development of specific traits for specific functions that reveal further use for other areas. In other words, it allows constant evolution and innovation, quite obvious when thinking that from the interaction of the individuals come the exchange of information, of new ideas, of concepts, the enlargement of horizons and creativity motivation.