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Creative destruction, sometimes known as Schumpeter's gale, is a term in economics which has since the 1950s become most readily identified with the Austrian-American economist Joseph Schumpeter, who adapted it from the work of Karl Marx and popularized it as a theory of economic innovation and the business cycle.

The term is derived from Marxist economic theory, where it refers to the linked processes of the accumulation and annihilation of wealth under capitalism.

These processes were first described in The Communist Manifesto ( Marx and Engels, 1848 ) and were expanded in Marx's Grundrisse ( 1857 ) and " Volume IV " ( 1863 ) of Das Kapital.