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How Entrepreneurs Improve the Economy

Written by: Sylvie Coletteedited by: Jean Scheidupdated: 6/24/2011


Self-starters, creative thinkers and service oriented entrepeneurs are a necessary
part of the work force. Business owners deserve respect. Go a step farther and
explore how entrepreneurs improve the economy.
Entrepreneurs are vital to the progress of the a countrys economy. These small
business owners are instrumental to improvement of the nation. Especially in times
of recession, their business activities help spur economic activity and encourage
exchange. Entrepreneurs, therefore, serve an important purpose in our society by
contributing to the improvement of the economy in a number of ways.
5 Reasons Why Entrepreneurs Improve the Economy
1. Entrepreneurs create businesses that hire people. This is the topmost reasons
why entrepreneurs improve the economy. Their businesses require a number of
employees to help them run the business; from accountants to computer
programmers to human resource staffs all businesses have them.
Entrepreneurs provide their employees a steady job and income. The workers
income puts food on the table and feed their family members. The same income will
be needed to be able to buy necessities such as food, clothing and shelter. This in
turn will help spur the economy and provide necessary jobs and businesses for
people that meet these basic needs.
For those who earn a lot more, they can now afford to spend on luxuries such as
vacation, jewelries and concerts. This will benefit the people working or providing
these kind of businesses.
2. Entrepreneurs pay taxes. The small businesses that the entrepreneurs
established are required to pay necessary local, state, and/or the federal
government taxes. The tax dollars from the businesses will be used by the
government to provide people with basic services such as health care,
transportation, education, construction and so many others.
3. Entrepreneurs create demand for products which in turn create jobs and other
businesses. Entrepreneurs need to buy products in order to produce finished goods.
They need raw materials. Sometimes these raw materials are finished goods
themselves, for instance gold.
Buying raw materials for their businesses will create other businesses which in turn
create more jobs. For example, it is necessary for fashion designers to buy silk
fabrics, so they go to silk fabric suppliers. These suppliers may require workers to
keep tract of their inventories and orders. And the cycle goes on and on, further
stimulating the economy.
4. Entrepreneurs introduce new technologies to the market. This is the disclosive
nature or history-making practices of entrepreneurs. They come up with new
technologies, create new products and provide new services. Steve Jobs, the

founder of Apple Computers, introduce us to Mac and iPod. Bill Gates founded
Microsoft. The works of these two individuals led to the creation of millions of other
software programs that we see today.

5. Entrepreneurs stimulates the economy by instilling confidence in people. The


economic health of a nation generally depends on its GDP (Gross Domestic Product)
performance. Entrepreneurs, through the jobs and businesses they create, are vital
to the GDP equation. Having a health economy makes people confident to invest,
live and work in that place even in times of recession.

Understanding the Timmons Model of Entrepreneurship


Written by: N Nayabedited by: Jean Scheidupdated: 4/30/2013
According to the Timmons Model of Entrepreneurship the three critical factors of a
successful venture are opportunities, teams, and resources. The successful
entrepreneur is one that can balance these critical factors.
Jeffery Timmons of Babson College in Massachusetts developed the Timmons Model
of Entrepreneurship as his doctorate thesis at Harvard University. Further research
and case studies have since then enhanced this model as a guide for entrepreneurs
to increase their chances of success.
The Timmons model bases itself on the entrepreneur. The entrepreneur searches for
an opportunity, and on finding it, shapes the opportunity into a high-potential
venture by drawing up a team and gathering the required resources to start a
business that capitalizes on the opportunity. In the process of starting the business,
the entrepreneur risks his or her career, personal cash flow and net worth. The
model bases itself on the premise that the entrepreneur earns rewards in
commensuration with the risk and effort involved in starting or financing the
business.

The Opportunity Factor


The Timmons model of entrepreneurship states that entrepreneurship is opportunity
driven, or that the market shapes the opportunity. A good idea is not necessarily a
good business opportunity and the underlying market demand determines the
potential of the idea. An idea becomes viable only when it remains anchored in
products or services that create or add value to customers, and remains attractive,
durable, and timely.
Unlike conventional entrepreneurship models that start with a business plan and
identify an opportunity, the Timmons model starts with a market opportunity. The
business plan and the financing receive secondary importance, and come only after
identification of a viable opportunity. The model holds that a sound business
opportunity would readily receive financing, and identification of the opportunity
first makes the business plan failure-proof.
The Team Factor
Once the entrepreneur identifies an opportunity, he or she works to start a business
by putting together the team and gathering the required resources. The size and
nature of the opportunity determines the size and shape of the team.
The Timmons model places special importance on the team and considers a good
team indispensable for success. A bad team can waste a great idea. Among all
resources, only a good team can unlock a higher potential with any opportunity and
manage the pressure related to growth.

The two major roles of the team, relative to the other critical factors are:
1. Removing the ambiguity and uncertainty of the opportunity by applying
creativity.
2. Providing leadership to manage the available resources in the most effective
manner by interacting with exogenous forces and the capital market context
that keeps changing constantly.
The Timmons model holds the entrepreneurs ability to conjure up a great team as a
major factor of business success. Great teams, however, always remain scarce and
the responsibility is on the entrepreneur to coach team members to excel.
The Resources Factor
The Timmons model discounts the popular notion than extensive resources reduce
the risk of starting a venture and encourages bootstrapping or starting with the bare
minimal requirements as a way to attain competitive advantages. The advantages
of bootstrapping include:
1. Drives down market cost
2. Instills discipline and leanness in the organization
3. Encourages creative resources to achieve more with the limited amount of
money and other resources available
Some of the practical applications of bootstrapping include leasing instead of buying
equipment, working out of a garage instead of rented space, and the like.
Like the formation of the team, the size and type of opportunity determine the level
and extent of resources required. While good resources remain scarce, businesses
with high potential opportunities and a good management team will have no
problem attracting money and other resources.
The entrepreneur works to minimize and control" rather than maximize and own."
The role of the entrepreneur in managing resources includes building a good
resource base to draw from when required and drawing up a business plan through
a fit and balance" method that balances the available resources with the
opportunity and the potential of the team.
A Reality Check
Many entrepreneurs try to have all resources in place before starting a new venture.
The Timmons model of entrepreneurship discounts this notion and holds only three
factors as crucial: a market driven opportunity, availability of a good team and
adequate resources. These three critical factors of entrepreneurship remain
interlinked, with any change in one factor having an impact on the other two.
The reality is that opportunity, team, and resources seldom match. The Timmons
model considers the major role of the entrepreneur to effect a match of the three
critical factors of entrepreneurship at the correct time. Success of the business
venture depends on the ability of the entrepreneur to ensure balance by applying
creativity and leadership, and by maintaining effective communications.

References
Timmons, Jeffry, A.; Zacharakis, Andrew, and Spinelli, Stephen. (2004). Business
Plans That Work: A Guide For Small Business. McGraw Hill.
ceotactics.net. The Entrepreneurial Process Part 3 The Timmons Model
Minniti, Maria, et. al. (2006). Entrepreneurship: The Engine of Growth. Praeger
Perspectives
Images by the author N Nayab

What is Entrepreneurship? A Look at Theory


Written by: N Nayabedited by: Rebecca Scudderupdated: 8/27/2011
People use the terms "entrepreneur" and "entrepreneurship" interchangeably. The
entrepreneur is the person who starts his own business. The exact definition of
"entrepreneurship" still remains a vague concept, though various entrepreneurship
theories have defined the concept.
Early Theories of Entrepreneurship
Richard Cantillon (1680-1734) was the first of the major economic thinkers to define
the entrepreneur as an agent who buys means of production at certain prices to
combine them into a new product. He classified economic agents into landowners,
hirelings, and entrepreneurs, and considered the entrepreneur as the most active
among these three agents, connecting the producers with customers.

Jean Baptise Say (1767-1832) improved Cantillions definition by adding that the
entrepreneur brings people together to build a productive item.
Frank Knight's Risk Bearing Theory
Frank Knight (1885-1972) first introduced the dimension of risk-taking as a central
characteristic of entrepreneurship. He adopts the theory of early economists such
as Richard Cantillon and J B Say, and adds the dimension of risk-taking.
This theory considers uncertanity as a factor of production, and holds the main
function of the entrepreneur as acting in anticipation of future events. The
entrepreneur earns profit as a reward for taking such risks.
Alfred Marshalls Theory of Entrepreneurship
Alfred Marshall in his Principles of Economics (1890) held land, labor, capital, and
organization as the four factors of production, and considered entrepreneurship as
the driving factor that brings these four factors together.

The characteristics of a successful entrepreneur include:


1. thorough understanding of the industry
2. good leadership skills
3. foresight on demand and supply changes and the willingness to act on such
risky foresights
Success of an entrepreneur however depends not on possession of these skills, but
on the economic situations in which they attempt their endeavors.
Many economists have modified Marshalls theory to consider the entrepreneur as
the fourth factor itself instead of organization, and which coordinates the other
three factors.
Max Webers Sociological Theory
The sociological theory entrepreneurship holds social cultures as the driving force of
entrepreneurship. The entrepreneur becomes a role performer in conformity with
the role expectations of the society, and such role expectations base on religious
beliefs, taboos, and customs.
Max Weber (1864-1920) held religion as the major driver of entrepreneurship, and
stressed on the spirit of capitalism, which highlights economic freedom and private
enterprise. Capitalism thrives under the protestant work ethic that harps on these
values. The right combination of discipline and an adventurous free-spirit define the
successful entrepreneur.
Mark Casson's Economic Theory
Mark Casson (1945-) holds that entrepreneurship is a result of conducive economic
conditions.
In his book "Entrepreneurship, an Economic theory" he states the demand for
entrepreneurship arising from the demand for change.
Economic factors that encourage or discourage entrepreneurship include:

1.
2.
3.
4.
5.
6.
7.

taxation policy
industrial policy
easy availability of raw materials
easy access to finance on favorable terms
access to information about market conditions
availability of technology and infrastructure
marketing opportunities

Joseph Schumpeters Innovation Theory


Joseph Schumpeters innovation theory of entrepreneurship (1949) holds an
entrepreneur as one having three major characteristics: innovation, foresight, and
creativity. Entrepreneurship takes place when the entrepreneur

1.
2.
3.
4.
5.

creates a new product


introduces a new way to make a product
discovers a new market for a product
finds a new source of raw material
finds new way of making things or organization

Schumpeters innovation theory however ignores the entrepreneurs risk taking


ability and organizational skills, and place undue importance on innovation. This
theory applies to large-scale businesses, but economic conditions force small
entrepreneurs to imitate rather than innovate.
Other economists have added a dimension to imitating and adapting to innovation.
This entails successful imitation by adapting a product to a niche in a better way
than the original product innovators innovation
Israel Kirtzners Theory of Entrepreneurship
Israel Kirzner (1935-) hold spontaneous learning and alertness two major
characteristics of entrepreneurship, and entrepreneurship is the transformation of
spontaneous learning to conscious knowledge, motivated by the prospects of some
gain.
Kirzner considers the alertness to recognize opportunity more characteristic than
innovation in defining entrepreneurship. The entrepreneur either remedies
ignorance or corrects errors of the customers.
His entrepreneurship model holds:
1. The entrepreneur subconsciously discovering an opportunity to earn money
by buying resources or producing a good, and selling it
2. Entrepreneur Financing the venture by borrowing money from a capitalist.
3. Entrepreneur using the funds for his entrepreneurial venture
4. Entrepreneur paying back the capitalist, including interest, and retaining the
"pure entrepreneurial profit."

Leibensteins Theory of Entrepreneurship


Harvey Leibenstein (1922-1994) consider entrepreneur as gap-fillers. The three
traits of entrepreneurship include:
1. recognizing market trends
2. develop new goods or processes in demands but not in supply
3. determining profitable activities
Entrepreneurs have the special ability to connect different markets and make up for
market failures and deficiencies.
McClellands Theory of Achievement Motivation

McClellands Theory of Achievement Motivation hold that people have three motives
for accomplishing things: the need for achievement, need for affiliation, and need
for power. Need for achievement and need for power drive entrepreneurship.
David McClelland (1917-1988) considers entrepreneurs as people who do things in a
better way and makes decisions in times of uncertainty. The dream to achieve big
things overpowers monetary or other external incentives.
McClellands experiment reveled that traditional beliefs do not inhibit an
entrepreneur, and that it is possible to internalize the motivation required for
achievement orientation through training.
Peter Druckers Theory of Entrepreneurship
Peter Drucker (1909-2005) holds innovation, resources, and an entrepreneurial
behavior as the keys to entrepreneurship. According to him entrepreneurship
involves
1. increase in value or satisfaction to the customer from the resource
2. creation of new values
3. combination of existing materials or resources in a new productive
combination
What theories do you think explain entrepreneurial drive?
An analysis of various entrepreneurship theories reveal while what economists differ
on the force that drives entrepreneurs or the central characteristics of
entrepreneurship, they remain unanimous that entrepreneurship is a distinct
concept and a central factor of the economic activity.
Let us know which you think is the theory that best covers entrepreneurial
motivation?
References
Image Credit:
geograph.org.uk/Dennis Thorley under CC 2.0 license
flickr.com/-Xv under CC 2.0 license

THE IMPACT OF ENTREPRENEURSHIPON ECONOMIC


GROWTH
Dr. Ercan EKMEKCIOGLU
Institution/Affiliation: Kyrgyzstan Turkey Manas UniversityE-mail:
ercan.ekmekcioglu@gmail.com
Abstract

According to Chell & Ozkan, (2010), an entrepreneur is someone who is willing to


bear the risk of a business venture where there is a significant chance for making
profit. Entrepreneurship is basically the practice of starting a business in order to
earn profit on new found opportunities. Entrepreneurship is a challenging task as
many businesses which start fail to take off. Entrepreneurship has many
uncertainties especially when new products are created for which there is no
existing market. Entrepreneurship affects economic growth in various ways. It is
through entrepreneurship that important innovations enter the market leading to
new products or production process which eventually increases efficiency through
bringing competition in the market. This paper discourses the impact of
entrepreneurship on economic growth. Ideas and concepts that emerge from
entrepreneurs increase our knowledge and what consumers may prefer through
introducing variations of existing products and services in the market. This speeds
up innovation of new products in the market as a result of the longer working hours
and more efficient nature of entrepreneurs as their income is directly linked with
their working input. Entrepreneurship leads to introduction of new goods with new
quality and value. Their innovativeness introduces new ways of production and new
markets that have not been exploited. It is through entrepreneurship that new
source of supply are discovered and creation of new business organisations that
directly affect the economy. Creation of new business opportunities through
entrepreneurship, productivity and innovation leads to economic growth. This
therefore means that when there is more entrepreneurship in an economy more
growth is expected.
Keywords: Entrepreneurship, Economic Growth, Innovativeness
1.0 Introduction
There has been a wealth of knowledge on the determinants of entrepreneurship
over the last few decades. Although studies bringing forth this knowledge have
rather been based on theoretical grounds, others have been drawn from empirical
evidence. Scholars have also been keen in investigating the impact of
entrepreneurship in relation to economic growth which has further led to the
explosion of extensive literature in this field (Van Stel, Carree & Thurik,2005). It
important to note that a significant amount of existing literature has been based on
the observation of firms, establishments and regions in terms of their economic
performance, growth and survival. The facts that can be derived from these studies
link economic growth with the size and age of the firm or an establishment.
According to Van Stel, Carree and Thurik (2005), newly established firms and very
small firms experience systematically faster growth compared to the already
established larger firms. These findings have been found to hold in the modern
industrialized economies as well as across time periods (Karlsson, Friis &
Paulsson,2004, p.3). The connection between entrepreneurship and economic
growth measured in terms of performance of the firm has been extended even
beyond observing the establishment to accommodate geographic regions. This
paper discourses how entrepreneurship can be related directly economic growth
and how entrepreneurship is at the heart of economic growth of any nation.

1.1 Understanding Entrepreneurship and Economic Growth


In terms of how entrepreneurship has been a stimulant in economic growth, there
exist enormous discussions and debates but it is however eminent to realize the
importance of constant innovations and rivalry enhancement (Todtling &
Wanzanbock, 2003). There has been a problem in defining and measuring
entrepreneurial factors and this has further complicated the exact contributions to
economic growth. According to Carree and Thurik (2002), the concept of
entrepreneurship is multidimensional and largely ill-defined. Understanding the role
of entrepreneurship in the process of economic growth will therefore require a
framework because of the nature of intermediate variables and connections which
exist (Bygrave & Minniti, 2000).The best examples of these intermediate variables
include innovation, competition mainly characterized by exit and entry of firms,
variety of supply and particular energy and efforts of invested by entrepreneurs.
Other conditions of entrepreneurship also add up when it comes to their
contributions to economic growth (Robbins, Pantuosso, Parker & Fuller, 2000). These
conditions include personal traits, cultural and institutional factors as shown in Fig 1
below.
Figure 1: Appreciating Entrepreneurship

1.2 Extended Definition of Entrepreneurship in Relation to Economic


Growth
While entrepreneurship is all about the activities carried out by individuals, the
concept of economic growth has often been relevant at firm level, industrial,
national and regional levels (Robbins, Pantuosso, Parker & Fuller, 2000). This implies
that linking entrepreneurship to economic growth will be to amalgamate individual
to aggregate levels. Considering this linkage however requires revisiting the
definition of entrepreneurship, whereby entrepreneurs, either as individuals or a
team, manifest their willingness and abilities to create new opportunities in
economy (Todtling & Wanzanbock, 2003). In this manner, novel products, production
modalities, organizational schemes and product-market combinations are created.
The entrepreneurs seek to introduce their newly crafted ideas in the existing market
in the face of obstacles and uncertainties. They also make critical decisions in terms

of business location, forms and the utilization of available resources and institutions
(Acs & Armington, 2004). In a nutshell, entrepreneurship refers to the behavioral
attributes of individuals and should not be confused with well-defined professional
persons (Lloyd-Ellis & Bernhardt, 2000).
2.0 Forms of Entrepreneurship
According to Carree and Thurik (2002), entrepreneurs in history have often been
represented in many faces and assumed different roles. As identified by scholars
such as Schumpeter, Kirzner and Knight, entrepreneurs can be termed as
innovators, profit opportunists and uncertainties and risk takers respectively.
Schumpeter drew his attention to understanding an entrepreneur as an innovator.
As an innovator, the entrepreneur performs new combinations which Schumpeter
called enterprises (Karlsson, Friis & Paulsson, 2004). An entrepreneur according to
Kirzner perceived profit opportunities. This role is what was labeled Kirznerian
entrepreneurship. The last role of an entrepreneur is that of assuming the several
risks and uncertainties which may be associated with running a business. This role
is labeled Knightian entrepreneurship. As the individual introduces a new product in
the market or starts a new business, this entrepreneurial role can be described in
terms of the three labels. As posted by Audretsch & Lehman (2005), the individual
who launches a new firm or introduces new products can be termed as the
innovator and he assumes that he has perceived a previously uncertain profit
opportunity. The innovator also takes risks that the venture or the new product may
eventually turn out to be atotal failure (Todtling & Wanzanbock, 2003).
2.1 Entrepreneurial Effects in the Growth of Economy
To sum up the contributions of entrepreneurship to economic growth Carree and
Thurik (2002) have provided five strands of empirical evidence to show their
involvement. The first evidence mainly deals with the turbulence effect of
entrepreneurship on the growth of economy. Turbulence can be viewed as the total
entries and exits in regions or industries and can easily be interpreted as one of the
powerful indicators of entrepreneurial activities. The effect of and changes in size
distributions in regions represents the second strand of evidence as identified by
the two researchers (Lloyd-Ellis & Bernhardt, 2000). It is believed that the change in
size distribution and its ultimate effects can have a significant impact on the growth
of economy (Carree, Van Stel, Thurik & Wennekers, 2002). Thirdly, the number of
market participants in any industry will finally have an important effect on economic
growth and this is recognized as another strand of evidence of the role of
entrepreneurship in economy expansion (Chell & Ozkan, 2010). Empirical literature
has also identified the effect of the number of business owners and self-employed
individuals in economic growth. This is the fourth strand of evidence that seeks to
appreciate the role of self-employment in the growth of economy in any state.
Lastly, the economic history of previously centralized and planned economies will
also have an influence in economic growth of countries (Carree, Van Stel, Thurik &
Wennekers, 2002). For instance, in Eastern Europe, small enterprise development
served as the most vital part of the transitional process which has seen economic
growth in the area. The turbulence effect of entrepreneurship on economic growth

refers to the entry and exist which however appears to have minimal contributions
to the growth of the economy in the short run (Bathelt, 2001). Nevertheless, the
entry-exit turnover will make a significant contribution especially in service industry
than in manufacturing industry in the long run as evidence by empirical research
done by Bosma and Nieuwen-huijsen (Chang, 2011). The effect of size distribution
changes of firms on growth performances has also been recognized particularly
when examining the share of small firms in the manufacturing industry in the
European states. Competition among firms which is a commonplace for
entrepreneurs has been shown to have a positive effect in the growth of economy
(Carree, 2002). The increased numbers of participants in the market compounded
with entrepreneurial activity are some of the contributions of entrepreneurship in
economic growth (Chell & Ozkan, 2010). In particular, local competition which is
measured in terms of the relative number of businesses in a region per worker
encourages growth of employment in industries thus economic growth.
Entrepreneurship encourages self-employment and this has been found to have an
impact in productivity growth (Chang, 2011). This is however a much contested
observation whether countries should adopt the equilibrium or the elf-employment
model which has largely failed counties such as Italy. According to Chang (2011),
the high levels of self-employment in the country have proved to be inefficient for
economic development. Italy has in the past experienced large negative impacts on
the growth of its economy because of self-employment. Scandinavian countries
represent cases of countries with relatively low rates of self-employment than the
equilibrium and have often been characterized by extensive public sector and low
rates of entry and exit. The contrary is seen when analyzing the business structure
in West Germany where they have low rates of self-employment (Van Stel, Carree &
Thurik, 2004a). In Germany, there is a total failure in the restructuring the economic
policies as the United Kingdom has done. The industrial policy in German has
repressed the structural changes by solely supporting large-scale industries with
enormous subsidies (Van Stel, Carree & Thurik, 2004b). This has led to the lack of a
vibrant economic growth made of new industries and firms in German and thus a
serious barrier to innovative activity.
2.2 Future Perspective in Analysis
From various strands of literature, there have been many insights that have inspired
a number of frameworks which should be embraced in the analysis of how
entrepreneurship plays a critical role in economic development. Carree and Thurik
(2002) found three different levels of analysis to be evident when associating
entrepreneurship to economic growth as this meant that the individual level could
be linked to the macro-economic sphere. These levels include the individual, firm
and the macro levels of analysis. According to Bruce, Deskins, Hill and Rork, (2009),
entrepreneurial actions usually take place at the level of the firm and thus require a
vehicle which can transform their individual ambitions and qualities into workable
actions (Todtling & Wanzanbock, 2003). In small firms, the entrepreneur usually has
the controlling stake which acts as the vehicle for transformations. Larger firms
have also been found to mimic smaller firms in terms of business units, joint
ventures and subsidiaries in order to introduced entrepreneurship or corporate

entrepreneurship. The results of such entrepreneurial manifestations at the level of


the firm must do with how novel processes, products, innovations, and entry to new
markets or start-ups are (Tesreau & Gielazauska, n.d). At national, industrial and
regional levels, entrepreneurial actions are all composed of new experiments.
3.0 Conclusion and Further Recommendations
Entrepreneurship play a critical role in the development of the economy as this is
the key contributor to innovativeness and product improvement. It is one of the
important ingredients to the creation of new employments and in the building of
communities in ways of offering them jobs. By contributing to local charities, taking
part in local business, investing in projects in communities and creating and
participating in different networks in entrepreneurship, they buildup robust
communities which contribute to the community development. Governments should
develop policies which will enhance entrepreneurship by understanding the critical
difference existing between small business owners and entrepreneurship. At the
same time, a misconception about entrepreneurs and where entrepreneurs can be
found can also help the local people to create the right picture of entrepreneurship
and thus become aggressive and contribute to economic development.

REFERENCES
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3 REASONS WHY ENTREPRENEURSHIP IS IMPORTANT


I have always loved to create stuff which obviously has led me the life of an
entrepreneur. I love it and believe that every human has this passion. Some more
than others of course. Entrepreneurship is not only important for a single business,
but it is also a key role in the growth of a country. Especially in Denmark since we
dont have any mountains, rivers, forests etc. to create natural jobs other
countries have because of their geography.
I believe entrepreneurship is very important, and during the next couple of months I
will write about this subject and how it is being an entrepreneur in Denmark. Which I
believe is one of the best countries in the world to start a company in.
But first, I will name a few reasons why entrepreneurship is important:
Entrepreneurship creates job opportunities
When an entrepreneur starts a business using his financial assets, he must need
some time to share his work load. For this purpose, he hires people to work with
him. As the time passes, the entrepreneur gets satisfied that he is investing his
money in the right place. So he starts a huge business, hence creating more job
opportunities for people.
Entrepreneurship cause economic growth
By creating job opportunities for people, an entrepreneur provides wealth to the
people. They tend to start a new business with innovation like providing the best
quality product within low price so that people can save their money and get the
best product. This strengthens the economy of a country. For this purpose
Government also welcomes entrepreneurs to start their business.
Entrepreneurship provides strength to small business
Most of the time, entrepreneurs prefer to invest their money in small businesses.
Such activities of the entrepreneurs provide strength to the small business. So the
niche markets flourish providing strength to the economy of the country.
So entrepreneurship can be categorized as investment and it is very important for a
country to flourish its economy. For this purpose, governments of many countries
support entrepreneurs, just like Vksthuset in Denmark. If you have a good
business idea that is scalable you have the opportunity to be rewarded with up to
20.000 DKK. When I started my first project/business idea I got this money as a help
by the danish government to get started.

5 Steps to Become an Entrepreneur


By Evan Tarver | August 5, 2015 10:45 AM EDT
Entrepreneurship has been romanticized over the better half of the 21st century.
With the rise of companies such as Google and Facebook, both of which made the
founders wildly successful, people are enamored with the idea of becoming
entrepreneurs.
Unlike a traditional career path where there is a defined path to the next step, the
path to entrepreneurship is mystifying to most. What works for one entrepreneur
might not work for the next and vice versa. That said, there are five general steps
that most, if not all, successful entrepreneurs have followed:
1. Ensure Financial Stability
This first step is not a strict requirement but is definitely recommended. While
entrepreneurs have built successful businesses while being less than financially
stable - think of Mark Zuckerberg as a college student - having strong financial
stability can only help an entrepreneur. This is due to the fact that strong personal
finances allow an aspiring entrepreneur to increase his personal runway and give
him more time to work on creating a successful business. In addition, with the high
stress of becoming an entrepreneur, having a personal runway of capital allows an
aspiring entrepreneur to focus on building a business rather than worrying about
making quick money.
2. Build a Diverse Skill Set
Once a person has strong personal finances in the form of a cash runway, it is
important to build a diverse set of skills and then apply those skills in the real world.
The beauty of step two is it can be done concurrently with step one.
Building a skill set can be achieved through learning and trying new tasks in realworld settings. For example, if an aspiring entrepreneur has a background in
finance, he can move into a sales role at his existing company to learn the soft skills
necessary to be successful. Once a diverse skill set is built, it gives an aspiring
entrepreneur a toolkit that he can rely on when he is faced with the inevitability of
tough situations.
3. Consume Content Across Multiple Channels
As important as building a diverse skill set is for an aspiring entrepreneur, so is the
need to consume a diverse array of content. This content can be in the form of
podcasts, books, articles or lectures. The important thing is that the content, no
matter the channel, should be diverse in what it covers. This is because as an
aspiring entrepreneur, a person should always familiarize himself with the world
around him so he can look at industries with a fresh perspective, giving him the
ability to build a business around a specific industry.

4. Identify a Problem to Solve


Through the consumption of content across multiple channels, an aspiring
entrepreneur is able to identify various problems to solve. The adage of business is
a company's product or service needs to solve a specific pain point, either for
another business or for a consumer group. Through the identification of a problem,
an aspiring entrepreneur is able to build a business around solving that problem.
It is important to combine steps three and four so it is possible to identify a problem
to solve by looking at various industries as an outsider. This provides an aspiring
entrepreneur with a fresh perspective and allows him to see a problem others might
not.
5. Add Value in That Problem Area
The fifth and final step to becoming an entrepreneur is to add value within the
problem that was identified in step four. Stated previously, successful businesses
solve a specific pain point for other businesses or consumer groups; they do this by
adding value to those businesses or consumers.
If, for example, it is identified the process for booking a dentist appointment is
complicated for patients and dentists are losing customers, the value could be to
build an online appointment system that makes it easier for patients to book
appointments. Only through adding value to solve a specific problem or pain point,
does an entrepreneur become successful.

10 Characteristics Of Successful Entrepreneurs


First, successful entrepreneurs have passion and motivation. Theyve found
something they can work on over and over again without growing bored -- a job
they want to do for the rest of their life.
Second, they will risk time and money, but they preserve resources for dealing with
unknown unknowns.
They are confident and enjoy what they do. Sometimes they come across as
stubborn, but that demonstrates their discipline and dedication.
Entrepreneurs are adaptable and flexible. They welcome any suggestion that can
optimize their offerings and satisfy their customers.
Entrepreneurs understand their offering and the market. They keep up with the
competition and consider external factors that can lead to failure.
Entrepreneurs manage their money. Profitability takes time, and until then capital is
limited and must be used wisely. Successful entrepreneurs keep a complete handle
on cash flows, the lifeblood of any business.
Entrepreneurs plan appropriately. They plan as much as possible, but keep some dry
powder in reserve, and handle the unexpected with the right mindset.
They have networking abilities. They reach out to mentors to seek valuable advice.

They are prepared to take the exit. Failure is not unusual, and sometimes its best to
follow a practical route into a new venture instead of sinking resources into a lost
cause.
And lastly, entrepreneurs doubt themselves, but not too much. Ask yourself, can I
do this? Do I want to do this? Instead of worrying about fitting in with someone
elses image, check your gut. That should tell you a lot.

5 Good Habits Every Entrepreneur Needs


By Evan Tarver | August 6, 2015 8:55 AM EDT
A Strong Work Ethic
It can also be referred to as grit, perseverance or conviction, but a strong work ethic
is the number one habit that every entrepreneur needs and that every successful
entrepreneur already has.
While there are successful businesses that have been built to reduce an
entrepreneur's work time, any business that a person starts is likely to require long
hours on the front end. Only after the entrepreneur has invested sweat equity in a
business is it possible to reduce work time. It takes a focused and dedicated work
ethic to make any entrepreneurial venture possible.
Consistent Self-Improvement
Every successful entrepreneur is constantly seeking opportunities to expand his skill
set. No matter what your background is, you will need to employ every skill
imaginable to make your company successful.
As an entrepreneur, you must be a salesperson, an operational expert, an effective
manager, a product manager, a financial analyst and maybe even an engineer.
Work towards consistent self-improvement in physical, spiritual, mental, social and
emotional areas. Practicing new skills in each of these areas and attempting to
implement them in the real world can help you achieve success in your business.
Setting Realistic but Challenging Goals
When you are starting a business, there will inevitably be a multitude of things to
improve upon or fix. While it's important to try to improve or fix each one of these
flaws, in an attempt to strengthen the business and to instigate your selfimprovement, it's impossible to focus on every possible area.
This lack of focus will result in a failed business. To mitigate this potential for failure,
cultivate a habit of setting consistent and realistic goals. The goals should be of the
highest priority. Limit your goals to the key drivers of the business. Follow the
SMART acronym to set your goals; the goals you set as an entrepreneur should be
specific, measurable, achievable, realistic and trackable.
Understand the Responsibility: Control Your Emotions

Steven R. Covey outlines this habit in his book, "The 7 Habits of Highly Effective
People." However, Covey doesn't mean that you need to cultivate a habit of
responsibility (which entrepreneurs do), but that you control your ability to respond
in all situations.
The path to entrepreneurship is an up-and-down roller-coaster ride, and it is
emotionally draining. It's easy to let your emotions control you, rather than the
other way around. Due to this fact, it's important to control all of your emotional
responses to stressful situations.
Focus on Adding Value
To be a successful entrepreneur, you need to have an ultimate focus on adding
value. It doesn't matter if the company that you are starting manufactures a
product or provides a service. It doesn't matter if it's a business-to-business
company or a business-to-consumer company. The bottom line is that your
company has to add value to its clients or customers.
While this is habit number five, it might be closer to habit number one in terms of
importance. Gone are the days where an entrepreneur can make a gimmicky
business that doesn't add any value but still manages to earn a lot of money.

Why Are Entrepreneurs Important?


For starters, entrepreneurs create new business. They invent goods and services,
resulting in employment, resulting in more and more development. For example, a
few IT companies founded the Indian IT industry in the 1990s. Businesses in
associated industries, like call center operations and hardware providers, flourished.
Entrepreneurs add to national income. Existing businesses may remain confined to
their markets and hit a glass ceiling when it comes to building income. But new
products or technologies create new markets, and new wealth. And increased
employment and higher earnings contribute to a nations taxes and spending.
Entrepreneurs create social change. They break tradition with unique inventions
that reduce dependence on obsolete systems. Smartphones and their apps, for
example, have revolutionized work and play across the globe.
Entrepreneurs invest in community projects and help charities and other good
causes, further developing ventures beyond their own. Bill Gates, for example, has
used his money to boost education and public health.
There is research that shows high levels of self-employment can stall economic
development. Entrepreneurship without regulation can lead to unfair market
practices and corruption, and too many entrepreneurs can create income
inequalities.
The bottom line, though, is that a balanced approach to nurturing entrepreneurship
can have a positive impact on an economy.

Why Entrepreneurs Are Important for the Economy


By Shobhit Seth | Updated December 29, 2015 2:02 PM EST
Entrepreneurs are frequently thought of as national assets to be cultivated,
motivated and remunerated to the greatest possible extent.
Entrepreneurs can change the way we live and work. If successful, their innovations
may improve our standard of living. In short, in addition to creating wealth from
their entrepreneurial ventures, they also create jobs and the conditions for a
prosperous society.
The following are six reasons why entrepreneurs are important to the economy.

Entrepreneurs Create New Businesses


Path breaking offerings by entrepreneurs, in the form of new goods & services,
result in new employment, which can produce a cascading effect or virtuous circle in
the economy. The stimulation of related businesses or sectors that support the new
venture add to further economic development.
For example, a few IT companies founded the Indian IT industry in the 1990s as a
backend programmers' hub. Soon the industry gathered pace in its own
programmers domain. But more importantly, millions from other sectors benefited
from it. (For more, see: Top Indian Billionaires And How They Made Their Money.)
Businesses in associated industries, like call center operations, network
maintenance companies and hardware providers, flourished. Education and training
institutes nurtured a new class of IT workers offering better, high-paying jobs.
Infrastructure development organizations and even real estate companies
capitalized on this growth as workers migrated to employment hubs seeking new
improved lives.
Similarly, future development efforts in underdeveloped countries will require robust
logistics support, capital investment from buildings to paper clips and a qualified
workforce. From the highly qualified programmer to the construction worker, the
entrepreneur enables benefits across a broad spectrum of the economy.
Entrepreneurs Add to National Income
Entrepreneurial ventures literally generate new wealth. Existing businesses may
remain confined to the scope of existing markets and may hit the glass ceiling in
terms of income. New and improved offerings, products or technologies from
entrepreneurs enable new markets to be developed and new wealth created.
Additionally, the cascading effect of increased employment and higher earnings
contribute to better national income in form of higher tax revenue and higher
government spending. This revenue can be used by the government to invest in
other, struggling sectors and human capital.

Although it may make a few existing players redundant, the government can soften
soften the blow by redirecting surplus wealth to retrain workers. (For more, see:
Starting A Small Business In Tough Economic Times.)
Entrepreneurs Also Create Social Change
Through their unique offerings of new goods and services, entrepreneurs break
away from tradition and indirectly support freedom by reducing dependence on
obsolete systems and technologies. Overall, this results in an improved quality of
life, greater morale and economic freedom.
For example, the water supply in a water-scarce region will, at times, force people to
stop working to collect water. This will impact their business, productivity and
income. Imagine an innovative, automatic, low-cost, flow-based pump that can fill in
people's home water containers automatically. Such an installation will ensure
people are able to focus on their core jobs without worrying about a basic necessity
like carrying water. More time to devote to work means economic growth.

For a more contemporary example, smartphones and their smart apps have
revolutionized work and play across the globe. Smartphones are not exclusive to
rich countries or rich people either. As the growth of China's smartphone market and
its smartphone industry show, technological entrepreneurship will have profound,
long lasting impacts on the entire human race.
Moreover, the globalization of tech means entrepreneurs in lesser-developed
countries have access to the same tools as their counterparts in richer countries.
They also have the advantage of a lower cost of living, so a young individual
entrepreneur from an underdeveloped country can take on the might of the multimillion dollar existing product from a developed country. (For more, see: Time For
Chinas Smartphone Revolution.)
Community Development
Entrepreneurs regularly nurture entrepreneurial ventures by other like-minded
individuals. They also invest in community projects and provide financial support to
local charities. This enables further development beyond their own ventures.
Some famous entrepreneurs, like Bill Gates, have used their money to finance good
causes, from education to public health. The qualities that make one an
entrepreneur are the same qualities that motivate entrepreneurs to pay it forward.
(For more, see: Encouraging Good Habits With An Incentive Trust.)
The Other Side of Entrepreneurs
Are there any drawbacks to cultivating entrepreneurs and entrepreneurship? Is
there an upper limit for the number of entrepreneurs a society can hold?
Italy may provide an example of a place where high levels of self-employment have
proved to be inefficient for economic development. Research reveals that Italy has
in the past experienced large negative impacts on the growth of its economy

because of self-employment. There may be truth in the old saying, "too many chefs
and not enough cooks spoil the soup." (For more, see: The Real Risks Of
Entrepreneurship.)
The Role of States
Regulations play a crucial role in nurturing entrepreneurship, but regulation requires
a fine balancing act on the part of the regulating authority. Unregulated
entrepreneurship may lead to unwanted social outcomes including unfair market
practices, pervasive corruption, financial crisis and even criminal activity.
Findings from United Nations University also indicate the possible implications of
over nurturing" entrepreneurship. Wim Naud argues that while entrepreneurship
may raise economic growth and material welfare, it may not always result in
improvements in non-material welfare (or happiness). Promotion of happiness is
increasingly seen as an essential goal.
Paradoxically, a significantly high number of entrepreneurs may lead to fierce
competition and loss of career choices for individuals. With too many entrepreneurs,
levels of aspirations usually rise. Owning to the variability of success in
entrepreneurial ventures, the scenario of having too many entrepreneurs may also
lead to income inequalities, making citizens more not less unhappy.

The Bottom Line


The interesting interaction of entrepreneurship and economic development has vital
inputs and inferences for policy makers, development institutes, business owners,
change agents and charitable donors. If we understand the benefits and drawbacks,
a balanced approach to nurturing entrepreneurship will definitely result in a positive
impact on economy and society.

Entrepreneurship Is the Key to Growth


By David B. Audretsch, November 2014
Americans typically assume that their country leads the world in entrepreneurship.
Even in the depths of the Great Recession, The Economist gushed, For all its
current economic woes, America remains a beacon of entrepreneurialism.1
However, the facts suggest something else.2 America is losing its entrepreneurial
edge. What might have seemed unimaginable as recently as fifteen years ago has
now, in fact, occurreda number of other countries, such as Taiwan in Asia and
Denmark in Europe, have surpassed the United States in entrepreneurial vigor.3
Reinvigorating American entrepreneurship provides an opportunity to revive
American economic growth and prosperity as well as restore the role of the United
States as the undisputed economic leader in the world. There are three important
ways that American entrepreneurship needs to be reinvigorated. The first is as a

conduit for knowledge spillovers. The second involves what we will term here as
main street entrepreneurship. The third way is through the identification and
commercialization of opportunities across the globe.
A minor army of scholars has provided compelling evidence showing that those
cities, states, and entire countries with vibrant entrepreneurship generally exhibit a
superior economic performance, typically measured in terms of economic growth,
productivity or unemployment.4 The reason why entrepreneurship drives economic
growth is because it serves as one of the most important conduits for facilitating
knowledge created in one organizational context to spill over and become
commercialized through innovative activity in a new startup. Where would the
country be had Steven Jobs not taken the ideas and inventions created at Xerox
PARC, which the company itself did not think were actually worth pursuing, to
launch his new startup? It is not just Apple Computer, but also Microsoft, Google and
Facebook, and thousands of other entrepreneurial startups that ensure that ideas
and inventions which are costly to create actually end up being commercialized and
transformed into the innovations that not only revolutionize their industries, but also
fuel economic growth, job creation and competitiveness in global markets.
To spur more knowledge-spillover entrepreneurship, America needs to remain
vigilant that people with important ideas, independent of what their current
occupational status is right now, have access to the key entrepreneurial resources
required to launch a new business money, talent, and know-how. We have to
make it as easy as possible for talented and creative people to take the leap into
entrepreneurship.

The second aspect of entrepreneurship involves the seemingly mundane world of


main street entrepreneurship. This type of entrepreneurship consists of small and
medium-sized enterprises that typically exhibit considerably less volatility and more
stability than their high-profile, headline-grabbing, knowledge-spillover
counterparts.5 But they matter. And they could matter a lot more. Main street
entrepreneurship provides the bulk of jobs in this country. But it remains
underutilized and performs way below its potential. The reason is that small
business has become the forgotten man of entrepreneurship. The high technology
counterparts grab not just the headlines, but also the policy priority, with their IPOs,
venture capital backing, and spectacular new product introductions.
The problem confronting Americas underperforming small business sector begins
with image. The glamor is in the adrenalin-fueled high technology startups, with
their boom-and-bust mentality and performance. By contrast, small business seems
boring and staid. But one of the reasons that the German economy has performed
better than the American economy over the last decade is not just the bedrock
stability it gets from its Mittelstand, or small and medium-sized businesses, but also
the compelling source of global competitive advantage in key product niches. It is
the German Mittelstand that is the key to the unique apprentice system providing
young workers with high levels of training, resulting in an unrivaled level of job
skills, which in turn fuels productivity. America needs to rediscover its longstanding

love affair with small business as both the bedrock of local communities and
national economic vitality. As the Frenchman Alexis de Tocqueville reflected in 1835,
What astonishes me in the United States is not so much the marvelous grandeur of
some undertakings as the innumerable multitude of small ones.6
The third role involves the fundamental feature of entrepreneurial thinking
discovering opportunities and then acting upon those opportunities. Given the
American predominance and preeminence following World War II, along with its
historical isolationist tendencies, it is perhaps not surprising that Americans have
developed the habit of looking for those opportunities predominately at home, in
the United States. After all, estimates placed half of the worlds wealth and twothirds of the physical capital in the United States as World War II came to an end.
Thus, it is perhaps understandable that when confronted by the recent economic
crisis, the drop in aggregate demand triggered calls for stimulating the economy
from political parties of all persuasion, albeit one side advocated increases in
government spending while the other side argued for tax cuts.7 The perception was
a lack of opportunities for American businesses to sell their products, so that
spending had to be increased, one way or another, to restore those opportunities.
The entrepreneurial view, however, suggests scanning not just the domestic
economy for opportunities. In a globalized economy, it makes sense to search for
and discover opportunities not only at home but throughout the world. This is
exactly what Germany has done in its astonishing economic resilience even while its
European neighbors and other leading developed countries have struggled. The
unemployment rate fell below six percent and in several Bundeslaender, such as
Bavaria and Baden-Wuerttemberg, was at negligible levels. By equipping its citizens
and businesses with an orientation and the skills to understand, comprehend,
interact, and ultimately thrive in other cultural and national contexts, Germany
looks for, and finds, opportunities not just at home, but throughout the world.
Through a careful development of a global orientation, Germany has equipped its
citizens and companies with the skills required to go out into the world to discover
and reap global opportunities. This global entrepreneurial orientation has paid
dividends in terms of growth, jobs and competitiveness. Through a global
entrepreneurial orientation, Germany has been able to fend off the Great Recession
with its strong export performance.
America needs to develop a similar entrepreneurial spirit and attitude. It is not
enough just to be comfortable and proficient in the context at home in the United
States. Americans need to be equipped with the attitudes, orientation, skills, and
competencies to go out into the world to discover, create, and act upon those
opportunities. This involves acquiring the so-called soft skills of cultural and
language competencies and feeling at home not just at home but also in other
countries and cultures as well.
Notes:
1 The United States of Entrepreneurs, The Economist, May 12, 2009.

2 See for example, the recent study by Ryan Decker, John Haltiwanger, Ron Jarmin,
and Javier Miranda, The Role of Entrepreneurship in US Job Creation and Economic
Dynamism, Journal of Economic Perspectives, Summer, 2014. In particular, the
authors conclude that, Evidence along a number of dimensions and a variety of
sources points to a US economy that is becoming less dynamic. Of particular
interest are declining business startup rates and the resulting diminished role for
dynamic young businesses in the economy.
3 Jose Ernesto Amoros and Niels Bosma, Global Entrepreneurship Monitor 2013
Global Report http://www.gemconsortium.org/docs/download/3106.
4 David B. Audretsch, Everything in its Place: Entrepreneurship and the Strategic
Management of Cities, States and Regions (New York: Oxford University Press,
2015).
5 David B. Audretsch, Innovation and Industry Evolution (Cambridge: MIT Press,
1995).
6 Cited from Audretsch, Innovation and Industry Evolution, p. 185.
7 Paul Krugman, The Return of Depression Economics and the Crisis of 2008 (New
York: W.W. Norton, 2008).

Role and Importance of Business Entrepreneurship in


Society
Olufisayo, October 10, 2010
Economists and businessmen have no doubts that private sector is in a lot of ways
much more efficient and effective than the public one, but few common people
share this opinion.
They generally believe that their greedy neighbours embark on business enterprises
driven mostly by insatiable passion for money and other selfish aspirations and they
refuse to see the role business plays in modern society, importance of
entrepreneurship to individual, importance of entrepreneurship in economic
development and importance of entrepreneurship in developing countries the role
that makes business not selfish at all.
First and foremost, business produces and distributes goods and services to satisfy
certain public needs. To fulfill this task, business has to be very flexible and
constantly research consumer demands: whats the point producing something that
nobody wants to buy?
Second , business creates job opportunities. More than that, most jobs business
helps create are productive jobs, i.e., people employed by business ventures
produce real goods and services.

Third , business provides income here we come at last to the money matter But
dont forget: income that business provides is by no means restricted to the profit
its owners get. It pays salaries and wages to its employees, and this way, makes the
whole business world go round: they spend the money they earn buying all kinds of
goods and favour further development of business ventures.
Forth , business contributes to national well-being. It does it in several ways: by
means of taxes it pays which make it possible for the government to maintain all
kinds of public and social institutions and services; by investing money in
developing science and technology and constructing new enterprises; by full use of
local recourses, including those located in remote rural areas, and in a number of
other ways.
Fifth , business helps enlighten and educate people and encourages their further
personal growth. High level of competition makes it vital for both businessmen and
their employees to be involved in the constant process of learning and developing
their personal qualities such as creativity, determination, communication skills and
vision for new business opportunities.
So you see, that despite public opinion on this matter, business is not all that
selfish. In fact, it is much more unselfish than a lot of public institutions It does
not exist to satisfy its own needs that is a way to business failure. On the contrary,
its function is to satisfy in the long run the consumer demands our demands, and
to make our life comfortable. So, when you make this crucial decision to embark on
a business enterprise, bear it in mind that it is a way to serve society.
Goals Of Individuals And Society
Setting goals, and then working to achieve them, is a sign of maturity and
responsibility in a society, just as it is a sign of maturity in an individual. What goals
have people set for themselves in their economic life? And how well are these goals
being achieved? These are the questions discussed in this handout.
One important goal that the people have set for their economy is Full Production in
order to achieve full employment. We want to make full use of the productive
resources that are available -labour, capital and natural resources -and use these
resources efficiently.
How well are we achieving the goal of full employment and full production? The
nation cant realistically expect to provide jobs continuously for 100% of the-men
and women who are able and willing to work. There will always be some
unemployment roughly 2 to 5% of the labour force. But when millions of people
are unnecessarily unemployed, it means they are not making a productive
contribution to the country and they are not earning an income. For this reason, the
goal of full production -which requires both full employment and efficiency is one
of the most important in our economy.
A second major goal is Stable Growth. We want the economy to become bigger and
better through the years. We measure the amount of our national output of goods
and services by looking at statistics of Gross National Product. Economic growth is a

steady increase in GNP per person (total GNP divided by the nations population).
We want GNP to increase more or less at a steady rate about 4 or 5% each year
(informal sector estimate) without having business recessions or rapidly rising
prices (inflation), or increases in unemployment.
Production, employment and growth of GNP are all pretty easy to measure. When
we come to certain other economic goals, however, we have to talk about them in
more general terms.
Freedom of Choice is a goal that practically everyone would include high on the list.
But what does it mean in concrete terms? Economists have pointed out that
freedom of choice is important for consumers, for workers, and for business.
Freedom of consumer choice means that consumers will be able to select the goods
they want to buy from a fairly wide range of alternatives, according to individual
needs and preferences. We are not satisfied with a system where the consumer is
told: You can have any size and colour hat you want as long as its medium and
black!
Freedom of occupational choice is an important area of economic freedom. Men and
women want to be able to choose the kind of work they will enjoy doing and that
will provide adequate wages and personal satisfaction.
Finally, there is much talk about the importance of free enterprise. This is
important aspect of freedom of choice. It gives people the freedom to start their
business and use the factors of production in such a way as to make a profit. Much
of the current economic system is built on the foundation of this particular freedom.
Equality of Opportunity for men and women in the society is another goal. It is
closely related to freedom of choice, because it says that all people should
approximately the same degree of freedom to exercise their rights as consul
workers and enterprises.
The goal of Economic Security means that we want the members of economic
society to have enough money to be able to buy adequate food, clothing, shelter
and other necessities.
Widespread poverty not only means failure to achieve the goal of economic security
for these people, but it also raises serious questions about whether we are
achieving the goal of Economic Justice in society. Not everyone agrees on the
meaning of fairness and justice in economic life, but it goal that nearly everyone
feels is important to define and work toward.
Finally, there is one economic goal that is not limited to the boundaries of the
country, but spreads overseas to other countries. This is the goal of International
Balance. We want to maintain a strong and balanced relationship in foreign trade
and international payments.
Failure to achieve this goal not only causes serious economic problems at home and
abroad, but also increases international tensions threaten world peace.

Basic Life Skills Needed By An Entrepreneur


Enterprising men and women have the ability or know-how that enables them to
undertake and complete activities. Most men and women have a certain amount of
knowledge, attitudes and practical skills that can be useful when realizing an
enterprise.
DEVELOPING MANAGERIAL SKILLS
When managing employees, entrepreneurs:
SHOULD:
be consistent
be fair and honest
build enthusiasm
encourage questions
encourage employees to make their own decisions
instil confidence in them
keep an open door
listen actively
_ recognize individual differences
set a personal example
show consideration for the feelings of others
SHOULD NOT
be argumentative
be autocratic
be overly demanding
be unreasonable
conceal the truth
discourage initiative
discourage ideas
do the thinking for employees
fail to clarify instructions
Play favorites

reprimand an employee in front of others


think small