Entrepreneurialism

Economic Perspective on Entrepreneurship

Entrepreneurship is a multifaceted concept. There are many definitions of entrepreneurship, some contradictory and others that are diverse. This article attempts to solve the definitional problem by explaining the economic perspective of entrepreneurship.

The economic outlook is dependent on certain economic variables such as innovation, risk bearing and resource mobilization.

Innovation/CreativityEntrepreneurs are people who create new combinations of productive resources. Entrepreneurs are distinguished from others by their ability to create new combinations (or innovations). There are many forms of entrepreneurship. Entrepreneurship involves initiating changes that result in an increase in goods produced and/or in organisational structure.

Scholars in entrepreneurship literature have raised concerns about the criteria for entrepreneurship being organization creation. Some argue that people are never entrepreneurs when they create organizations, such as social groups, political parties, and associations. As strange as this may sound, entrepreneurship has been used by many scholars to reflect the spirit and innovation of the times. This can be seen in attempts to apply entrepreneurial thinking to current team-oriented workplace strategies. These groups, which include political parties, associations, and social groups, can be called entrepreneurial groups. In recent years, these groups have seen a rise in activity and are being called social entrepreneurial.

Risk TakingThis is another economic variable around which the economic outlook revolves. Entrepreneurs and non-entrepreneurs are different because they take on risk. Entrepreneurs tend to take calculated risks. They take the risk of uncertainty in the market. There are both critics as well as advocates for this idea. Although entrepreneurs might not risk their own money, they may be more likely to lose reputation and get a better job elsewhere.

Resource Mobilization Here, entrepreneurship can be described as being alert to potential profits in the economy. Entrepreneurs play the role of opportunity identifiers, allocating resources to pursue opportunities. In this way, entrepreneurs can identify and synthesize information from the environment to make decisive decisions.

This article has defined entrepreneurship as a combination of resource mobilization and risk-taking. Apart from the economic variables mentioned above, entrepreneurs can also be seen as a result of the personal motivations, motivations, and incentives of each actor involved in the act of entrepreneurship. This is the psychological view, which will be the topic of a future article. We will also be looking at the small business perspective and the process.

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