ROLE OF ENTREPRENEUR IN ECONOMIC DEVELOPMENT
The industrial health of a society depends on the level of entrepreneurship existing in it. A country might remain backward not because of lack of natural resources or dearth of capital [as it is many times believed] but because of lack of entrepreneurial talents or it inability to tap the latent entrepreneurial talents existing in that society. Entrepreneurs historically have altered the direction of national economies, industry or markets- Japan, Singapore, Korea, Taiwan to name a few. Economic Economic Development Development - Entrepreneurship is basically concerned with creating wealth through production of goods and services. This results in a process of upward change where whereby by the the real real per per capit capitaa inco income me of a coun countr try y rise risess overt overtim imee or in othe otherr word wordss economi economicc develop developmen mentt takes takes place. place. Thus Thus entrep entrepren reneur eurial ial develo developme pment nt is the key to economic development. In fact it is one of the most critical inputs in the economic development of a region. It speeds up the process of activating factors of production leadin leading g to a higher higher rate rate of econom economic ic growth growth,, disper dispersal sal of economi economicc activi activitie tiess and development of backward regions. If a region is unable to throw up a sufficient number of entrepreneurs then alien entrepreneurs usually step in to provide goods and services needed by the people. However the profits earned by these entrepreneurs are usually not ploughed back but repatriated to their place of origin. As a result development in that region cannot take place. Dr. M.M. Akhori refers to this practice as ‘The Leech Effect’. The above above reiter reiterate atess the import importance ance of entrep entrepren reneur eurshi ship p develo developme pment nt for fuell fuelling ing economic growth of a region.
Entrepreneurship begets and also injects entrepreneurship by starting a chain reaction when the entrepreneur continuously tries to improve the quality of existing goods and serv servic ices es and and add new new ones ones.. E.g. E.g. when when comp comput uter erss came came into into the the mark market et ther theree was was conti continu nuou ouss impr improv ovem emen entt in the the mode models ls,, thei theirr func functi tions ons etc. etc. like like firs firstt gener generat atio ion n computers, personal computers, laptops, palmtops etc. Not only had this fostered the devel developm opment ent of the the soft softwa ware re indu indust stry ry,, comp comput uter er educa educati tion on inst instit itut utes es,, comp comput uter er maintenance and stationery units etc. but also other industries like banking, railways, education, travel, films, medical and legal transcriptions, business process outsourcing [BPOs] etc. In this manner by harnessing the entrepreneurial talent a society comes out of traditional traditional lethargy lethargy to modern modern industrial industrial culture. culture. India needs entrepreneu entrepreneurs rs to capitalize capitalize on new opportunities and to create wealth and new jobs.
Education - Towards the end of the sixties, two significant contributions were made in the the fiel field d of entr entrep epre rene neur ursh ship ip .One .One was was that that ther theree is a posi positi tive ve linka linkage ge betw betwee een n entrepreneurship and economic development and the other was regarding the emergence of a strong hypothesis that entrepreneurship can be developed through planned efforts1. Consequently planners realized that absence of a strong entrepreneurial base acts as a seriou seriouss handica handicap p in the indust industria riall develo developme pment nt of a region region.. The identi identifi ficat cation ion and development development of first first generation generation entrepreneu entrepreneurs rs through through Entrepreneu Entrepreneurial rial Development Development Programmes is an important strategy.
There is a growing realization that presence of resources and favourable government pol polic icie iess cann cannot ot auto automa mati tica call lly y manu manufa fact ctur uree econ econom omic ic deve develo lopm pmen ent. t. It is the the entrepreneurial spirit of the people, which can transform the economy of that region. Both the quantity and quality of entrepreneurs are of utmost significance for achieving the goal of economic development. The myth that entrepreneurs are born with some innate traits is fortunately no longer held. You will learn more about this in the lesson on motivation. Many research studies have brought out that entrepreneurship can be taught and learne learned. d. Entrep Entrepren reneur eurshi ship p is a discip disciplin linee and like like all discip disciplin lines es it has models models,, proces processes ses and case case studie studies, s, which which can help help an indivi individua duall to study study this this subjec subject. t. The necessary competencies required of a successful entrepreneur can be acquired through training and development. Numerous courses in entrepreneurship are being taught all over the world in schools and colleges, seminars and conferences are being organized and EDPs are being conducted. The thinking today is why just create managers why not create people who can absorb managers. One can acquire the traits and learn the skills for becomi becoming ng an entrep entrepren reneur eur e.g. a person person can learn learn to be achievem achievement ent orient oriented, ed, selfselfconfide confident, nt, persev persevera erant nt etc. etc. which which are all part part of the charac character terist istics ics of a succes successfu sfull entrepreneur.
IMPORTANCE OF ENTREPRENEURSHIP IN DEVELOPED ECONOMY •
The The natu nature re of a deve develo lopi ping ng econ econom omy y is quit quitee diff differ eren entt from from a developed economy.
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The develo developin ping g econom economy y can be an agricu agricultu ltural ral countr country y moving moving towards the
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industrialization or it may be the one where in the industry may be in its infancy lacking advance technology.
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The modern era is an era of changes. The whole world is becoming a villa illage ge due to the indust dustri riaal rev revolut olutio ion n and and fast fast devel evelo opin ping commu communi nica cati tion on tech techno nolo logy gy.. The The glob global aliz izat atio ion n of indu indust stry ry and and commerce is bringing a vast change in various aspects of life.
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Economic development of a country is the outcome of purposeful human activity.
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The modern era is an era of changes. The whole world is becoming a villa illage ge due to the indust dustri riaal rev revolut olutio ion n and and fast fast devel evelo opin ping commu communi nica cati tion on tech techno nolo logy gy.. The The glob global aliz izat atio ion n of indu indust stry ry and and commerce is bringing a vast change in various aspects of life.
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Economic development of a country is the outcome of purposeful human activity.
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Economic development is a highly dynamic process characterized by the pattern of demand shifts, new products are needed, appear for the production of goods within a country.
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A develo developin ping g countr country y needs needs entrep entrepren reneur eurss who are compet competent ent to perceive new opportunities and are willing to incur the necessary risk in exploiting them.
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A developing economy is required to be brought out of the vicious circle of low income and poverty.
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Entrepreneur can break this vicious circle.
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Entrep Entrepren reneur eurss and helpin helping g govern governmen mentt can change change a develo developin ping g economy in developed economy.
economic ic Entrep Ent repren reneur eursh ship ip and and econom economic ic growth growth / develo developm pment ent: econom development of any region is the outcome of purposeful human activities. According to Schumpter, the economic development consists of employing resources in a different way bringing in new factors of production or combination of the factors. The entrepreneur looks for innovative ideas and puts them into effect for economic development. The entrepreneur occupies a crucial place in the process of economic development by acting as a trigger head to give spark to economic activities. Some of the development activities are as follows: 1.increase in the income. 2. Brings change in the structure of business and society. 3. Wealth creation. 4. New products, services and business. 5. Generation of employment. 6. Increase in the standard of living. ROLE OF ENTREPRENEURSHIP IN ECONOMIC DEVELOPMENT
The industrial health of a society depends on the level of entrepreneurship existing in it. A country might remain backward not because of lack of natural resources or dearth of capital [as it is many times believed] but because of lack of entrepreneurial talents or it inability to tap the latent entrepreneu entrepreneurial rial talents talents existing existing in that society. society. Entrepreneu Entrepreneurs rs historical historically ly have altered the direction of national economies, industry or markets- Japan, Singapore, Korea, Taiwan to name a few. f ew. 1.4.1 ENTREPRENEURSHIP AND ECONOMIC DEVELOPMENT
Entrep Entrepren reneur eurshi ship p is basica basically lly concer concerned ned with with creati creating ng wealth wealth throug through h production of goods and services. This results in a process of upward change whereby the real per capita income of a country rises overtime or in other words economic development takes place. Thus ntrepreneurial development
is the key to economic development. In fact it is one of the most critical inputs in the economic development of a region. It speeds up the process of activating factors of production leading to a higher rate of economic growth, dispersal of economic activities and development of backward regions. If a region is unable to throw up a sufficient number of entrepreneurs then alien entrepreneurs usually step in to provide goods and services needed by the people. However the profits earned by these entrepreneurs are usually not plo ploug ugh hed back back but repa repatr tria iate ted d to thei theirr place lace ofori forigi gin n. As a resu result lt development in that region cannot take place. Dr. M.M.Akhori refers to this practi practice ce as ‘The ‘The Leech Leech Effect’. Effect’. The above above reiter reiterate atess the import importanc ancee of entrepreneu entrepreneurship rship development development for fuelling fuelling economic economic growth growth of a region. region. Entrepreneurship begets and also injects entrepreneurship by starting a chain reaction when the entrepreneur continuously tries to improve the quality of existing goods and services and add new ones. E.g. when computers came into the market there was continuous improvement in the models, their functions etc. like first generation computers, personal computers, laptops, palmtops etc. Not only had this fostered the development of the software indu indust stry ry,,
comp comput uter er educ educat atio ion n
inst instit itut utes es,,
comp comput uter er main mainte tena nanc ncee and and
stat statio ione nery ry unit unitss etc. etc. but but also also othe otherr indu indust stri ries es like like bank bankin ing, g, rail railwa ways ys,, education, travel, films, medical and legal transcriptions, business process outsourcing [BPOs] etc. In this manner by harnessing the entrepreneurial tale talent nt a soci societ ety y come comess out out of trad tradit itio iona nall leth lethar argy gy to mode modern rn indu indust stri rial al culture. India needs entrepreneurs to capitalize on new opportunities and to create wealth and new jobs. 1.4.2 ENTREPRENEURSHIP AND EDUCATION
Towards the end of the sixties, two significant contributions were made in the the field field of entr entrep epre rene neurs urshi hip p .One .One was was that that ther theree is a posi positi tive ve link linkag agee betwe between en entrep entrepren reneur eurshi ship p and econom economic ic develo developme pment nt and the other other was regarding the emergence of a strong hypothesis that entrepreneurship can be developed developed through through planned planned efforts1. efforts1. Consequent Consequently ly planners planners realized realized that absence of a strong entrepreneurial base acts as a serious handicap in the industrial development of a region. The identification and development of first first
gene genera rati tion on
entr entrep epren reneu eurs rs
thro throug ugh h
Entr Entrep epre rene neuri urial al
Deve Develo lopm pmen entt
Programmes is an important strategy. There is a growing realization that pre prese senc ncee
of
reso resour urce cess
and and
favo favour urab able le gove govern rnme ment nt poli polici cies es cann cannot ot
automatically manufacture economic development. It is the entrepreneurial spirit of the people, which can transform the economy of that region. Both the quanti quantity ty and qualit quality y of entrep entrepren reneur eurss are of utmost utmost signif significa icance nce for achieving the goal of economic development. The myth that entrepreneurs are born with some innate traits is fortunately no longer held. You will learn more about this in the lesson on motivation. Many research studies have brought
out
that
entrepreneurship
can
be
taught
and
learned.
Entrep Entrepren reneur eurshi ship p is a discip disciplin linee and like like all discip disciplin lines es it has models models,, proces processes ses and case studie studies, s, which which can help an indivi individua duall to study study this this subject. The necessary competencies required of a successful entrepreneur can be acquired through training and development. Numerous courses in entrepreneurship are being taught all over the world in schools and colleges, semi semina nars rs and and conf confer eren ence cess are are bein being g orga organi nize zed d and and EDPs EDPs are are bein being g conducted. The thinking today is why just create managers why not create people who can absorb managers. One can acquire the traits and learn the skil skills ls for for beco ecoming ming an ent entrep repren reneur eur e.g. .g. a perso rson can can lear learn n to be
achievement oriented, self- confident, perseverant etc. which are all part of the characteristics of a successful entrepreneur. Usually the model used for entrepreneurial education has three phases : Stimulatory Phase - This phase involves planned publicity for opportunities,
motivation training and help and guidance in selection of product or service. Support Phase - This provides help in registration of units, arrangement of
finance as well as land, sheds, power, water, common facility centres etc. Help is also provided in marketing of products. Sustenance Phase- Once the enterprise is set up then help is provided for
modernization, diversification, additional finance etc. ROLE OF ETHICS AND SOCIAL RESPONSIBILITY IN CONTEXT OF ENTREPRENEURSHIP •
An entrepreneur must take risks with his or her own capital in order to sell and deliver products and services while expanding greater energy than the average businessperson in order to innovate.
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A manager’s attitudes concerning corporate responsibility are related to the organizational climate perceived to be supportive of laws and professional codes of ethics.
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On the other hand, entrepreneurs with a relative with a relatively new comp compan any y who who have have few role role mode models ls usua usuall lly y deve develo lop p an inte intern rnal al ethical code.
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Entrepreneurs tend to depend on their own personal value systems muc much more more than han othe otherr man manage ager appropriate course of action.
when hen dete etermin rminin ing g ethi ethica call lly y
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Ethics refer to the “study of whatever is right ands good for human bei being ng”, ”, busi busine ness ss ethi ethics cs conc concern ernss itse itself lf with with the the inve invest stig igat atio ion n of business practices in light of human values.
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Ethics is the broad field of study exploring the general nature of morals and the specific moral choices to be made by the individuals in his relationship with others.
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Business ethic is the study of behavior and morals in a business situation.
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Busi Busine ness ss ethi ethics cs is “any “any busi busine ness ss deci decisi sion on that that creat creates es valu valuee for customer by matching quality and price.”
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Although the English word ethics is generally recognized r ecognized as stemming from from the the Gree Greek k etho ethos, s, mean meanin ing g “cus “custo tom m and and usag usage” e”,, it is more more prope properly rly identi identifie fied d as origin originati ating ng from swedhe swedhetho thos, s, in which which the concepts of individual morality and behavioral habits are related and identified as an essential quality of existence.
