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pablosilba949   , 29

from Trenton


Entrepreneurship - A Brief Introduction



Entrepreneurship is the practice of designing, starting and running a new company, which is often originally a small business. The men and women who make these companies are called entrepreneurs.

Entrepreneurship was described as the "capacity and willingness to develop, arrange and manage a business enterprise alongside some of its dangers so as to make a profit". While definitions of entrepreneurship typically revolve around the start and running of companies, due to the large risks involved in launching a start-up, an important percentage of startup companies must close because of "lack of financing, bad business decisions, an economic crisis, lack of market demand--or even a mixture of all of these.

Entrepreneurship is the action of being an entrepreneur, or even "an owner or manager of a business enterprise who makes money at risk and initiative". Entrepreneurs act as supervisors and oversee the launch and expansion 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 required for its exploitation.

Early 19th century French economist Jean-Baptiste Say provided a broad definition of entrepreneurship, stating that it "shifts economic resources out of an area of lower and into a place of higher productivity and greater yield". Entrepreneurs create something new, something different--they change or transmute values. Regardless of the firm size, large or small, they could partake in entrepreneurship opportunities. The opportunity requires four standards.

First, there must be opportunities or situations to recombine tools to generate profit. Second, entrepreneurship requires differences between people, such as preferential access to specific people or the ability to recognize information regarding opportunities. Third, taking on risk is quite necessary. Fourth, the entrepreneurial process demands the organization of people and resources.

The entrepreneur is a factor in microeconomics and also the study of entrepreneurship reaches into the job of Richard Cantillon and Adam Smith in the late 17th and early 18th centuries. But, entrepreneurship was largely ignored theoretically before the late 19th and early 20th centuries and empirically before a profound resurgence in economics and business since the late 1970s. From the 20th century, the understanding of entrepreneurship owes much to the work of economist Joseph Schumpeter from the 1930s along with other Austrian economists like Carl Menger, Ludwig von Mises and Friedrich von Hayek.

According to Schumpeter, an entrepreneur is someone who is willing and able to convert a brand new idea or invention into a successful invention. Entrepreneurship employs what Schumpeter called "the gale of creative destruction" to replace in whole or part poor innovations across markets and businesses, simultaneously producing new products including new business models. In this manner, creative destruction is mostly responsible for its dynamism of businesses 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 such is hotly debated in academic economics. An alternate description posited by Israel Kirzner implies that nearly all innovations may be more incremental improvements such as the replacement of paper with plastic from the making of drinking straws.