Creative Destruction in AM: What the Nobel Prize Winners Got Right

When the Nobel Prize in Economic Sciences was awarded in 2025 for work explaining innovation-driven economic growth, many readers outside economics likely skimmed past it. Inside manufacturing and technology circles, the reaction was equally quiet. Yet for anyone who has followed additive manufacturing (AM) closely over the past two decades, the prize landed comfortably close to home.

The awarded work formalised a mechanism first articulated by Joseph Schumpeter: creative destruction. Innovation creates temporary advantage, displaces established structures, and reallocates value. Growth emerges not from smooth optimisation, but from discontinuity. In the 1990s, this intuition was turned into a rigorous growth model by Philippe Aghion and Peter Howitt. In 2025, it was recognised as one of the central explanations for long-term economic development and awarded the Nobel Prize in Economic Sciences.

Additive manufacturing has often been framed as disruptive, even though the term creative destruction has rarely been used explicitly. AM disrupts manufacturing. AM replaces supply chains. AM kills machining. Anyone with practical exposure knows that this framing rarely survives contact with reality. Conventional manufacturing remains dominant. Capital stock persists. Qualification regimes endure. Machining is alive and well.

Something interesting happens if the theory is applied carefully. In some well-known successful additive manufacturing applications, the mechanism described by Schumpeter and formalised by Aghion–Howitt appears almost uncomfortably precise.

Additive manufacturing is not a single innovation. It is a collection of innovations operating under different constraints. In most of them, coexistence dominates. But in a few, AM introduces a capability shift that changes economics, collapses process chains, and renders prior advantages structurally weaker. That is not hype. That is creative destruction in the original sense.

Consider medical implants. Orthopaedic implants have long been manufactured at scale using established methods. Those methods are not inherently inadequate. However, clinical performance in some implant categories benefits from controlled porosity, lattice structures, and surface architectures that encourage osseointegration. Conventional manufacturing can approximate these features, but often only by adding steps such as coatings, assemblies, secondary treatments, or by accepting design compromises.

Metal powder bed fusion changed that balance. In these specific implant classes, porous structures are no longer applied to a part; they are the part. The functional geometry becomes intrinsic. When this happens, entire sections of the legacy process chain lose relevance. Coating suppliers, intermediate processing steps, and certain qualification logics are displaced, not because AM is fashionable, but because the economic and functional centre of gravity has shifted.

Having been directly involved in the early industrialisation of these processes, including introducing additive manufacturing into regulated serial production, this pattern is clear in hindsight.

The value did not come from replacing manufacturing as such, but from enabling new products that made previously dominant process steps economically and technically secondary.

Incumbent companies often survive these transitions by adapting. What tends to disappear is not the company, but the basis on which it previously competed. Startups and new entrants often introduce the initial shift, while established firms adapt to it. Innovation rarely removes firms. It removes the conditions that made certain capabilities valuable.

A similar pattern appears in tooling, although it is quieter and easier to miss. Here, additive manufacturing does not replace tooling, but alters the economics around it. In early and intermediate stages, faster feedback, shorter time to market, and improved economics for low-volume manufacturing weaken the advantage of long, rigid tooling pathways in favour of more flexible ones.

Tooling as a discipline does not disappear, and machining remains essential. What changes is where the advantage resides.

These cases are striking because they align so cleanly with the theory. They also highlight something equally important: many of the most visible AM success stories are better described as creative creation than creative destruction.

Clear aligners are a good example. Their rise is often described as a manufacturing story, but the primary innovation is systemic. Digital scanning, treatment planning software, data-driven workflows, and large-scale custom production were combined into a coherent pipeline. Additive manufacturing plays a crucial enabling role, but it does not primarily displace an existing manufacturing process. It enables a new operating model and a new market category.

Rather than replacing an established structure, a new one emerged.

The same pattern is visible in rocket engines and propulsion development, but here the effect goes well beyond faster iteration. Additive manufacturing expands the feasible design space itself. Deeply integrated geometries can be treated as a single design problem rather than as a sequence of manufacturing compromises. This has enabled propulsion architectures that would be difficult to produce, qualify, and iterate using conventional fabrication routes, while maintaining comparable mass, cost, and reliability.

Recent engine programs, including the latest generation of SpaceX engines, illustrate how part count reduction and internal geometric freedom translate into higher performance, improved robustness, and faster system-level maturation.

A complementary signal can be seen with LEAP 71. Here, new propulsion concepts are not derived by iterating existing designs, but by combining multiple innovations and generating broad solution spaces computationally, which can then be built and tested directly using metal additive manufacturing. This shifts established design paradigms rather than refining them.

From an economic perspective, the interest lies in how innovation is created. Advantage no longer comes from incremental optimisation of known designs, but from access to a design method that makes previously infeasible solutions economically testable. In that sense, the example aligns closely with the mechanism recognised by the Nobel Prize, where innovation changes what can be explored and therefore what can compete.

Taken together, these cases show that in the new space sector, additive manufacturing both changes how fast hardware is developed and what kinds of systems can be developed in the first place. It helps explain why new space provides a particularly clear example of how additive manufacturing aligns with the innovation mechanism recognised by the Nobel Prize, where new capabilities reshape both performance outcomes and sources of advantage.

This is not creative destruction in the narrow sense, but creative creation. A new development regime becomes viable through a change in production capability.

A different but very strong signal comes from consumer electronics, where Apple has publicly adopted metal additive manufacturing for the serial production of titanium watch cases. The significance lies in the context. Additive manufacturing is now being trusted in settings where volume, consistency, and brand risk are decisive.

The Nobel recognised theory is not challenged by the different patterns observed across additive manufacturing applications. It is corroborated by them. Creative destruction was never meant as a universal description, but as a mechanism that operates under specific conditions. Where those conditions are present, the outcomes follow a familiar pattern.

Seen this way, there is no need to describe additive manufacturing as disruptive in general. What matters is where specific capabilities change design choices, production routes, and cost structures. In those cases, established advantages weaken, and value shifts accordingly.

The work recognised by the 2025 Nobel Prize in Economic Sciences, awarded to Philippe Aghion, Peter Howitt, and Joel Mokyr, is an attempt to describe how innovation reshapes economic structures when specific conditions are met. Seen through that lens, it becomes clearer where and why additive manufacturing changes who wins and why, and where it does not.

About the Author:

Ulf Lindhe is a veteran executive in the additive manufacturing industry with decades of experience spanning technology development, industrial strategy, and global market expansion. He has held senior leadership roles within the metal additive manufacturing sector, contributing to the commercialization and international growth of advanced AM systems. Over the course of his career, Lindhe has worked closely with aerospace, medical, and high-performance engineering companies, helping bridge the gap between technological capability and practical industrial deployment.