Role of Entrepreneurship in Economic Development Essay
Entrepreneurship is the attempt to create value through recognition of business opportunity, the management of risk taking appropriate to the opportunity and through the communicative and management skills to mobilize human financial and material resources necessary to bring a project to fruition.
According to A. H. Cole, "Entrepreneurship is activity of an individual, undertaken to initiate, maintain or aggrandize profit by production or distribution of economic goods and services."
According to Schumpeter, "Entrepreneurship is based on purposeful and systemic innovation. It included not only the independent businessman but also company directors and managers who …show more content…
Entrepreneurship helps in the process of economic development in the following ways:
Promotes Capital Formation:
Entrepreneurs promote capital formation by mobilizing the idle savings of public. They employ their own as well as borrowed resources for setting up their enterprises. Such type of entrepreneurial activities leads to value addition and creation of wealth, which is very essential for the industrial and economic development of the country.
Growing unemployment particularly educated unemployment is the problem of the nation. The available employment opportunities can cater only 5 to 10 % of the unemployed. Entrepreneurs generate employment both directly and indirectly. Directly, self employment as an entrepreneur and indirectly by starting many industrial units they offer jobs to millions. Thus entrepreneurship is the best Way to fight the evil of unemployment.
National Income consists of the goods and services produced in the country and imported. The goods and services produced are for consumption within the country as well as to meet the demand of exports. The domestic demand increases with increase in population and increase in standard of living. The export demand also increases to meet the needs of growing imports due to various reasons. An increasing number of entrepreneurs