After the publication of Theorie der wirtschaftlichen Entwicklung in 1912, Schumpeter diverted his research interest from economics to economic sociology. His first topic in economic sociology was social classes, an idea he had developed in his lectures on “State and Society” at the University of Czernowitz (1910–11), “The Theory of Social Classes” at Columbia University (1913–14), and “The Problem of Social Classes” at the University of Graz (1915–16). His first article on the subject, “Die sozialen Klassen in ethnisch homogenen Milieu” (1927a), was published on the occasion of his 1926 lecture on “Leadership and Class Formation” at the University of Heidelberg.

During the same period Schumpeter also brought out several sociological works: Die Krise des Steuerstaates (1918), “Zur Soziologie der Imperialismen” (1918/19), and “Sozialistische Möglichkeiten von heute” (1920–21). All of these studies were based on the vision of changing capitalism, and, together with his theory of social classes, would be finalized as Capitalism, Socialism and Democracy (1942).

This chapter aims to interpret and reconstruct Schumpeter's sociological work and discusses, for that purpose, the development of his thought on Capitalism, Socialism and Democracy in terms of a series of component theories of leadership, social classes, tax state, imperialism, and socialism. Some might consider sociological themes such as the tax state and imperialism to be digressions from Schumpeter's major research areas. But in my view this is not true.