Evolution of Entrepreneurship

1.0  Literature Review

1.1 Entrepreneurship

Entrepreneurship is a process of innovation and new venture creation through four major dimensions: individual, organization, environmental and process that is aided by collaborative networks in government, education and institutions (Kuratko and Hodgetts, 2004). Nonetheless, entrepreneurship encompasses more than what entrepreneur do (Dodd and Anderson, 2007). It involves the circumstances that enable entrepreneurs to start their business (Blanchflower and Oswald, 1998; Gnyawali and Fogel, 1994) and the processes that enable some places to be more ‘entrepreneurial’ (Armington and Acs, 2002; Bennett, Braton, and Robson, 2000; Bennett and Smith, 2002; Keeble, 1997; Keeble, Lawson, Moore, and Wilkinson, 1999; Romanelli and Schoonhoven, 2001).

According to Van Prang (1999), Richard Cantillon was the first economist to acknowledge the entrepreneur as key economic in his posthumous Essai sur l nature du commerse en general first published in 1755 (Cantillon, 1959). Cantillon saw the entrepreneur as responsible for all exchange and circulation in the economy. As opposed to wage workers and land owners who both receive a certain of fixed income or rent, the entrepreneur earns an uncertain profit (Hebert and Link, 1988).

            1.2 Evolutionary Perspective

Since the publication of Origin of the Species (Darwin, 1859), researchers in domains of study at times far removed from biology have expanded the key principles of Darwinian change to disciplines such as language, psychology, economics, behavior and culture (Aldrich and Ruef, 2006; Dennett, 1995; Durham, 1991; Nelson and Winter, 1982; Plotkin, 1994; Richerson and Boyd, 2005; Tooby and Cosmides, 1992).

Generalized Darwinists argue that at a sufficient level of abstraction a core set of general Darwinian principles of variation, selection and retention can be used to describe evolution within a variety of domains (Campbell, 1965; Hodgson and Knudsen, 2004), including biology, psychology, culture and economics. [1]

2.0  Overview

The historical evolution of ideas about the entrepreneurship is a wide-ranging subject and one that can be organized in different ways, theorist by theorist, period by period, issue by issue and so forth (Ricketts, 2008).

There were historic changes in the world economy during the 1980s and the 1990s where these changes were part of what is called the new world order. [2] At its heart have been transformations in the way in which business is conducted. Technology is assuming an increasingly important role; world competition is more open and spirited than ever; thousands of jobs are being eliminated in industry after industry; and service industries are steadily growing.

Developments in entrepreneurship are sometimes seemed as stemming from three sources. Firstly is from the contributions of economic writers and thinkers on the role of the entrepreneur in economic development and the application of economic theory. Secondly is from the psychological trait approach on personality characteristics of the entrepreneur. Thirdly is a social behavioral approach which stresses the influence of the social development as well as personality traits. [3]

            2.1 Evolution of Entrepreneurship

Entrepreneurship is flourishing in many places around the world. The term of entrepreneurship can be traced back as early as the Middle Ages where an entrepreneur was simply someone who carried out tasks and managed large production projects. Individuals did not take any risks. A typical entrepreneur in the Middle Age was the priest and the person in charge of great architectural works used to build castles and fortifications and public buildings.

However, an entrepreneur was a person who was responsible for undertaking a business venture during the 17th century. The connection of the risk with entrepreneurship developed where an entrepreneur entered into a contract with the government to perform service or to supply stipulated products.

During the 17th century, Richard Cantillon was the first to recognize the crucial role of the entrepreneur in economic development which was founded on individual property rights. [4] He viewed the entrepreneur as a risk taker.

There was an Industrial Revolution during the 17th and 18th century where business itself was becoming part of the new lifestyle. The early economists such as John Baptiste, John Stuart Mill, and Alfred Marshall included entrepreneurship into the economic spectrum of the time by defining various skills and features of an entrepreneur. These definitions were varied from an entrepreneur being responsible for employing resources in high productivity areas, to risk bearing and finally to an entrepreneur being responsible for an organization.

In the 20th century, Joseph Schrumpeter claimed that, only certain extraordinary people have the ability to be entrepreneurs and they bring about extraordinary events. The Schrumpeterian entrepreneur changes technological possibilities and convention through innovative activity and moves production constraints. For instance, railroads and shipping, cargo, transport growth in commerce during the late 18th century and early 19th century.

In the middle of the 20th Century, the function of an entrepreneur was to recreate or revolutionize the pattern of production by introducing an invention. Innovation is the act of introducing some new ideas where it is one of the most difficult tasks for an entrepreneur.

3.0  Conclusion

There is no consensus concerning the definition of entrepreneur and entrepreneurship. Entrepreneurship is a dynamic process of vision, change and creation. It requires an application of energy and passion towards the creation and implementation of new ideas and creative solutions.

4.0  References

A Brief History of Entrepreneurship. Retrieved from http://www.slideshare.net/Isteaq/a-brief-history-of-entrepreneurship

Deakins, D. (1996). Entrepreneurship and Small Firms. McGraw-Hill

Lambing, P.A and Kuehl, C.R. (2003). Entrepreneurship 3rd Edition. Pearson Education, Inc.

Mole, K and Ram, M. (2012). Perspectives in Entrepreneurship. A Critical Approach. Palgrave, London

A Brief History of Entrepreneurship. Retrieved from http://www.slideshare.net/Isteaq/a-brief-history-of-entrepreneurship

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[1] Mole, K and Ram, M. (2012). Perspectives in Entrepreneurship. A Critical Approach. Palgrave, London. P. 107.

[2] Lambing, P.A and Kuehl, C.R. (2003). Entrepreneurship 3rd Edition. Pearson Education, Inc. P. 2.

[3] Deakins, D. (1996). Entrepreneurship and Small Firms. McGraw-Hill. P. 7.

[4] Deakins, D. (1996). Entrepreneurship and Small Firms. McGraw-Hill.P. 8.