The concept of entrepreneurship is multi-faceted. There are actually varied, diverse and somewhat contradictory sets of definitions of the term. As a way out the definitional dilemma, this article aims to explain the economic perspective on entrepreneurship.
The financial perspective rests on certain economic variables which include innovation, risk bearing, and resource mobilization.
Innovation/Creativity In the approach, entrepreneurs are folks who carry out new combination of productive resources. The key ingredient, the carrying out of new combination (or innovation) distinguishes entrepreneurs from non-entrepreneurs. While new venture creation appears as the most prevalent type of entrepreneurship, there exist other forms. Entrepreneurship also involves the initiation of changes within the type of subsequent expansion within the quantity of goods produced, and in existing form or structure of organisational relationships.
Within the entrepreneurship literature, some scholars have questioned the utilization of organization creation as criterion for entrepreneurship. It has been argued that organizations such as political parties, associations and social groups are always created by men and women that are not "entrepreneurs." Interesting as it might sound, the terms entrepreneurship and entrepreneur skills (visit Cpi here >>) are already adopted by varied scholars to meet the innovation and spirit of the time. This really is evidenced by attempts to apply entrepreneurial thinking to contemporary team-oriented place of work strategies. Members of such groups - political parties, associations and social groups - as a result, could possibly be called entrepreneurial teams. Besides, activities inherent in such groups have flourished at this point, and are increasingly being described as social entrepreneurship.
Risk Taking This is another financial variable upon which the economic perspective revolves. Risk taking distinguishes entrepreneurs from non-entrepreneurs. Generally, entrepreneurs are calculated risk takers. They bear the uncertainty in market dynamics. This notion has its critics and advocates. Entrepreneurs might not necessarily risk her own funds but risk other personal capital such as reputation and also the possibility of being more gainfully employed elsewhere.
Resource Mobilization here, entrepreneurship is reflected in alertness to perceived profit opportunities within the economy. This implies the allocation of resources in quest for opportunities with the entrepreneur playing the role of a chance identifier. This way, entrepreneurs are distinguished by their ability to identify persistent shocks or challenges (of long-term opportunities) to the environment, and after that to synthesize the information and take decisive actions based upon it.
This article has conceptualized entrepreneurship based on resource mobilization, risk taking, and innovation. Beyond the previously mentioned economic variables, entrepreneurship may also be viewed determined by a set of personal characteristics, motives and incentives of the actor in the entrepreneurship act. This is the psychological perspective, the topic of a future article. Along with the psychological perspective, we shall also examine the process and small business perspectives.
The financial perspective rests on certain economic variables which include innovation, risk bearing, and resource mobilization.
Innovation/Creativity In the approach, entrepreneurs are folks who carry out new combination of productive resources. The key ingredient, the carrying out of new combination (or innovation) distinguishes entrepreneurs from non-entrepreneurs. While new venture creation appears as the most prevalent type of entrepreneurship, there exist other forms. Entrepreneurship also involves the initiation of changes within the type of subsequent expansion within the quantity of goods produced, and in existing form or structure of organisational relationships.
Within the entrepreneurship literature, some scholars have questioned the utilization of organization creation as criterion for entrepreneurship. It has been argued that organizations such as political parties, associations and social groups are always created by men and women that are not "entrepreneurs." Interesting as it might sound, the terms entrepreneurship and entrepreneur skills (visit Cpi here >>) are already adopted by varied scholars to meet the innovation and spirit of the time. This really is evidenced by attempts to apply entrepreneurial thinking to contemporary team-oriented place of work strategies. Members of such groups - political parties, associations and social groups - as a result, could possibly be called entrepreneurial teams. Besides, activities inherent in such groups have flourished at this point, and are increasingly being described as social entrepreneurship.
Risk Taking This is another financial variable upon which the economic perspective revolves. Risk taking distinguishes entrepreneurs from non-entrepreneurs. Generally, entrepreneurs are calculated risk takers. They bear the uncertainty in market dynamics. This notion has its critics and advocates. Entrepreneurs might not necessarily risk her own funds but risk other personal capital such as reputation and also the possibility of being more gainfully employed elsewhere.
Resource Mobilization here, entrepreneurship is reflected in alertness to perceived profit opportunities within the economy. This implies the allocation of resources in quest for opportunities with the entrepreneur playing the role of a chance identifier. This way, entrepreneurs are distinguished by their ability to identify persistent shocks or challenges (of long-term opportunities) to the environment, and after that to synthesize the information and take decisive actions based upon it.
This article has conceptualized entrepreneurship based on resource mobilization, risk taking, and innovation. Beyond the previously mentioned economic variables, entrepreneurship may also be viewed determined by a set of personal characteristics, motives and incentives of the actor in the entrepreneurship act. This is the psychological perspective, the topic of a future article. Along with the psychological perspective, we shall also examine the process and small business perspectives.