"Edmund Phelps defines capitalism, or free enterprise, as a system: “characterized by great openness to the implementation of new commercial ideas coming from people in private business, and by a great pluralism of views among the wealth-owners and financiers who decide which ideas to nurture by providing them the capital and incentives necessary for their development. Although much innovation comes from established companies, as in pharmaceuticals, much also comes from start-ups—particularly the most novel innovations.”

http://capitalism.columbia.edu/files/ccs/CCSWP73_Ammous%202011-10-21.pdf