MIT Sloan Management Review Article on Growth Is Not a Zero-Sum Game

My fifth-grade daughter is learning some basic laws of physical science in school this year, and I’ve been thinking about one of them in relation to a few articles in the spring 2019 issue of MIT SMR. Here’s the law, paraphrased somewhat: In a closed system, energy can neither be created nor destroyed. It’s just rearranged.

Could something similar be said about businesses and the value they generate? Companies are destroyed all the time — whether by their own hand, by macro forces, or by competitors they underestimated or didn’t see coming. But each time a new player emerges, is it always at the expense of something else? Should we view growth and destruction as simply value rearranged?