Entrepreneurship Economics and Economists

During the past two hundred years of history of eco-nomic thought, four separate stages can be distinguished in respect to the significance economists attach to the entrepreneurial role in the market economy. As is well known, the classical economists (with some notable exceptions such as . B. Say, who continued the French tradition begun by Cantillon) did not recognize an entrepreneurial function distinct from that of the capitalist. For the classical economists profit meant the income share...

Regulated Market Economy

I shall assume, as noted at the outset of this essay, that government regulation ol the market economy is generated by dissatisfaction with market outcomes. Legislators or other government officials (perhaps in response to public outcry, or in anticipation thereof) are disturbed either by the high price that certain would-be purchasers are asked to pay in the market or by the low price (for example, farm prices or the wages of labor) received by certain sellers in the market or they are...

Notes

See my ''Classical Economics and the Entrepreneurial Role ' in Israel M. Kirzner, Perception, Opportunity, and Profit (Chicago University of Chicago Press, 1979). 2. For a survey and bibliography on theories of entrepre-neurship during this period see F. H. Knight, Risk, Uncertainty and Profit (Boston Houghton Mifflin, 1921), chap. 2. 3. W. J. Baumol, Entrepreneurship in Economic Theory, American Economic Revie w 58 (May 1968) 64. 4. Robert F. H bert and Albert N. Link, The Entrepreneur...

The Primacy of Entrepreneurship

What is important is to insist that entrepreneurial alertness differs in fundamental respects from the resources ordinarily discussed in decision making. These differences will justify my contention that there may be important differences between different economic systems in respect to their success in harnessing entrepreneurial alertness for making error-free decisions. A cardinal quality of a potential resource, in the economists' analysis of decisions, is that the decision maker can deploy...

Action and Alertness

Man acts, in the light of the future as he envisages it, to enhance his position in that future. The realized consequences of man's actions, however, flow from the impact of those actions on the actual (as contrasted with the envisaged) course of future events. The extent to which man's plans for the enhancement of his prospects are fulfilled depends on the extent to which the future as he has envisaged it corresponds to the future as it in fact occurs. There is no natural set of forces or...

Of Both Worlds

The approaches outlined in the preceding section offered us clear-cut and, indeed, seemingly inescapable options. Either we abstract from originative entrepreneurial activities or we discard our claims to render the world intelligible by reference to equilibrium configurations of maximizing decisions. Either we ignore the entrepreneur or we jettison the received theory of price. (It will be observed that a sense of these stark options underlay the rationalization provided earlier for the...

The Danger of Taking the Entrepreneur for Granted

Perhaps the most important contribution that the recent renewal of professional interest in the entrepreneurial process can make toward public policy is to stimulate a general awareness of the grave dangers that accrue from the error of taking the entrepreneur and his role for granted. No doubt there were eras in the history of the development of economic understanding when this kind of error was relatively less critical. No doubt an understanding of the general pattern of results produced by...