▁A . ▁Sch ump eter ▁Society . ▁In ▁this ▁book , ▁L azon ick ▁shows ▁how ▁in ▁the ▁last ▁dec ades ▁of ▁the ▁ 2 0 th ▁century ▁New ▁Econom y ▁companies ▁used ▁the ▁spec ulative ▁stock ▁market ▁to ▁attract ▁fin ance ▁in ▁the ▁form ▁of ▁vent ure ▁capital , ▁which ▁could ▁realize ▁returns ▁through ▁a ▁quick ▁IP O ▁on ▁NAS DA Q . ▁These ▁New ▁Econom y ▁companies ▁also ▁used ▁the ▁spec ulative ▁stock ▁market ▁to ▁attract ▁labor ▁partially ▁compens ated ▁with ▁stock ▁options ▁to ▁eng age ▁in ▁innov ative ▁product ▁development . ▁When ▁they ▁became ▁prof itable , ▁these ▁companies ▁became ▁obs essed ▁with ▁boost ing ▁their ▁stock ▁prices ▁through ▁massive ▁stock ▁rep urch ases . ▁Meanwhile , ▁led ▁by ▁IBM ▁and ▁H ew lett - Pack ard , ▁Old ▁Econom y ▁companies ▁made ▁the ▁transition ▁to ▁the ▁New ▁Econom y ▁business ▁model , ▁but ▁in ▁the ▁process ▁sever ely ▁comprom ised , ▁and ▁in ▁some ▁cases ▁destroyed , ▁their ▁innov ative ▁capabilities . ▁ ▁In ▁a ▁ 2 0 1 6 ▁working ▁paper ▁for ▁the ▁Institute ▁for ▁New ▁Econom ic ▁Th inking , ▁L azon ick ▁argued ▁that ▁stock - based ▁pay ▁har ms ▁invest ment ▁in ▁a ▁fir ms ▁product ive ▁and ▁innov ative ▁capabilities ▁by ▁prior it izing ▁financial ▁invest ment ▁go ▁to ▁stock ▁buy back s ▁instead . ▁ ▁Fin an cial ization ▁ ▁Much ▁of ▁L azon ick ' s ▁research ▁has ▁been ▁devoted ▁to ▁stock ▁buy back s ▁and ▁the ▁alleg ed ▁financial ization ▁of