Santos-Dumont, Wright brothers and the “spirit” of Entrepreneurship

This small reflection comes from my PhD dissertation, during a short passage where I examine the power of the rationalized Anglo-American “spirit” of entrepreneurship when compared to the Latin French-Brazilian “spirit” behind the invention of the airplane:

In the first decades of the 20th century, Schumpeter identifies this strength of the Unternehmergeist (“Entrepreneur-spirit” in German) in society. The concept of entrepreneurship cannot be fully understood without his contributions. Schumpeter argued that the innovation and technological change of a nation comes from the entrepreneurs and had a very clear view about the role that both innovations and entrepreneurs played in market-oriented economies. Nations that had adopted market-oriented economic model had experienced a kind of economic evolution explained by neoclassic economists with the use of limited static analysis that focuses on the calculation of economic variables thought the use of supply and demand curves in accordance with rational choice theory. According to Schumpeter, innovations were the responsible for the dynamism and the evolution of this economic model, since they were responsible for strong internal impacts on the system by changing the way products and services are developed, done or delivered. New combinations of old products or practices were also considered innovations by Schumpeter and those innovations are often responsible for changing economic power from one hand to another in society, giving dynamism to the system. This is the moment where the person responsible for those changes appears: the entrepreneur. Therefore, the entrepreneur is not just a well succeeded businessman or businesswoman, more than that, he is an innovative businessman or businesswoman. The entrepreneur is a special type of economic actor responsible for putting innovations into action – not necessarily technological innovations – and therefore promoting the development of the economy as a whole. Moreover, Schumpeter affirms that the entrepreneur is not motivated by the hedonistic fruits of his work; he is a natural leader in the search of social recognition. Schumpeter defines an ideal-type of entrepreneur whose actions ignites the process of “creative destruction” as innovative products, services and management practices create new markets that often destroy established ones. According to Schumpeter, the entrepreneur is able to rearrange a set of resources in a different way, disrupting with established ideas and provoking a short moment of self crises in the system or in part of it. In that sense, Schumpeter contributed by starting a different economic debate about the role of individuals not necessarily motivated only by rational profit in the development of markets.

One precise case illustrates very well the different mindsets over the exploration of innovation and entrepreneurship under different social perspectives: during the development of flying machines. Many inventors were studying flying machines by the year 1900. The Brazilian inventor Alberto Santos-Dumont, for example, worked since 1898 in his machines, being the first person in the world to flight a self propelled flying machine in Paris, in 1903. In accordance with his set of values and beliefs, Santos-Dumont never thought about patents or making fortune from his inventions. According to Hoffman’s work on the inventor (2004):

“Santos-Dumont did not believe in patents. He made the blueprints of his airships freely available to anyone who wanted them. He saw the flying machine as a chariot of peace, bringing estranged cultures in contact with one another so that they could get to know one another as people, thereby reducing the potential hostilities”.

Meanwhile, in the other side of the Atlantic Ocean:

“[…] the Wright brothers had a very different motivation from Santos-Dumont in developing the plane. They were not idealists. They did not dream about bringing distant people together. They were not thrill-seekers. […] They were intent on building flying machines for financial gain”.

These passages go in accordance with Max Weber’s writings about the Protestant Ethic and the “Spirit” of Capitalism published only one year after that, in 1904 and 1905 and with Schumpeter’s later conception of the entrepreneurs. Under this perspective Santos-Dumont can be considered an inventor, while the Wright brothers, entrepreneurs, despite of the fact that they were working in very similar projects.