10 mars 2018 ~ 0 Commentaire

The Importance of Entrepreneurship in Business

The Importance of Entrepreneurship in Business eCorner_Education2

http://ladiesonthetour.sites.gettysburg.edu/entrepreneur/simon-arias

Entrepreneurship is the process of designing, starting and running a new company, which is often initially a small company. The men and women who make these businesses are known as entrepreneurs.

Entrepreneurship was described as the « capacity and willingness to grow, organize and manage a company enterprise alongside some of its risks in order to make a profit ». While definitions of entrepreneurship normally focus on the launching and running of companies, because of the high risks involved in launching a start-up, an important percentage of start-up companies must close due to « lack of funding, poor business decisions, an economic crisis, lack of market demand–or a mixture of all these.

Entrepreneurship is the action of becoming an entrepreneur, or « an operator or manager of a business enterprise who makes money through danger and initiative ». Entrepreneurs act as supervisors and oversee the launch and growth of an enterprise. Entrepreneurship is the process by which either an individual or a team defines a business opportunity and acquires and deploys the essential resources needed for its exploitation.

Early 19th century French economist Jean-Baptiste Say provided a broad definition of entrepreneurship, saying that it « shifts economic resources from an area of lower and into an area of higher productivity and higher return ». Entrepreneurs create something fresh, something different–they change or transmute values. Irrespective of the firm size, big or little, they could partake in entrepreneurship opportunities. The chance needs four criteria.

First, there must be opportunities or situations to recombine resources to generate profit. Second, entrepreneurship requires differences between individuals, such as preferential access to certain individuals or the ability to recognize information about opportunities. Third, taking on risk is a necessary. The entrepreneurial process requires the organization of people and resources.

The entrepreneur is a factor in microeconomics and the analysis of entrepreneurship reaches to the work of Richard Cantillon and Adam Smith in the late 17th and early 18th centuries. However, entrepreneurship was mostly ignored theoretically until the late 19th and early 20th centuries and empirically until a profound resurgence in economics and business since the late 1970s. In the 20th century, the understanding of entrepreneurship owes considerably to the work of economist Joseph Schumpeter from the 1930s along with other Austrian economists such as Carl Menger, Ludwig von Mises and Friedrich von Hayek.

According to Schumpeter, an entrepreneur is a person who’s willing and ready to convert a brand new idea or innovation into a successful innovation. Entrepreneurship employs what Schumpeter called « the gale of creative destruction » to substitute in whole or in part inferior innovations across markets and industries, simultaneously creating new products including new business models. In this way, creative destruction is largely responsible for its dynamism of industries and long-term financial development.

The supposition that entrepreneurship leads to economic growth is an interpretation of the remaining in endogenous growth theory and as this is hotly debated in academic economics. An alternate description posited by Israel Kirzner suggests that the majority of innovations may be more incremental improvements such as the replacement of paper with plastic from the making of drinking straws.

http://ladiesonthetour.sites.gettysburg.edu/entrepreneur/simon-arias

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