Document contains 2022/2023 year 2 economics of entrepreneurship cheat sheet for utrecht university (uu) that you were allowed to bring in for the exam. It has all the case studies with their main points needed to do well on the exam.
Neoclassical vs austrian unemployment in a specific occupation
-
Knight: risk (measurable, relatively predictable) vs uncertainty Occupational earnings and entrepreneurship —> higher income
(unmeasurable, heterogeneous) risk = higher change entrepreneur, higher expected income for
Kirzner: alertness, DIY and discovery—> entrepreneur not job = lower chance entrepreneur, failure to achieve occupation
special, but person with good timing. Opportunities ‘out income = ^ chance
-
there’ Skill variety and entrepreneurship —> many skills = ^ chance
Saravathy: effectuation (to bring) + Barney: opportunity creation -
Occupational role models of self-employment and entry barriers
Schumpeter: creative destruction (entrepreneur introduces - How occupational environment can influence choice
disruptive innovations and changes system) Kautonen et al.
Austrian school Foss et al. -
The intention to start a business is not always the starting
-
Methodological individualism: plans of individuals to pursue point of the entrepreneurial process
goals -
Theory of planned behaviour -Ajzen: Attitudes toward behaviour
-
Subjectivity: value is not inherent —> consumer at center of (personal beliefs) + subjective norms (beliefs environment
economic around you) + perceived behavioural control (self-efficacy,
-
Tact and dispersed knowledge: subjectivism of bailout to do it) —> Intention
knowledge, information and expectations —> behaviour
-
Uncertainty: knowledge uneven, time -
PBC has double role: high levels of control over behaviour —
-
Heterogeneity of capital: if homo then there wouldn’t be > direct connection (no intention needed), lower level of
cooperation issues control, prediction of behaviour through intention = proxy for
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Entrepreneur =drives economy >> entrepreneurial judgement actual behaviour
is talent Dencker et al
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Occupational theory: entreprn=self-employment, individual -
Opportunity-driven and necessity-driven entrepreneurs
= unit of analysis -
Entrepreneurial processes in developing environments
-
Structural theory: start-ups, scale-ups —> firm as unit of under basic psychological needs (institutions, human
analysis - entrepreneur driver of economic growth Mises capital)
-
Functional theory: entrepreneurship = action/process not -
(absent, low): replication = copying
outcome—> behavioural spect, entrepreneurial judgement -
(present, low) = experiential replication = trial and error
(based on uncertainty to reduce uncertainty
-
Judgement based approach Knight, Mises —> entrepreneur is -
(absent, high) = skill-preserving = observing and
different, decision making without rules to follow learning from existing businesses
Elert et al. -
- (present, high) = skill-leveraging = based on institutions
Collaborative innovation bloc: how firms create its impact and human capital, new opportunities identified and
on society and create value over time—> idea/innovation exploited
(inventor and entrepreneur) —> new firm (early-stage -
Basic safety needs developed environments (institutions, HC)
financers, customers, key personnel-knowledge dispersed -
(absent, low) = imitation = mimic
time and place) —> growing firm (later-stage financers) —> -
(present, low) = differentiation = develop value propositions
large firm -
(absent, high) = path-dependency = operate on skill set
-
Incentivised by institutions -
- (present, high) = ambitious path-dependency = capitalise
Interconnectedness agents and resources
- on skills, ambition supported by institutions
Difference schumpeterian and replicative entrepreneurs -
Coleman boat: sociology —> macro level change —> impacts
(start firm similar to existing) future macro environment, also impact individual
-
EU focused on innovation > don’t see innovation actors/resources (micro/austrian) —> individuals act on
comes from entrepreneurs change —> aggregate change of macro change. Stages:
Wennekers & Thurik 1999
- Institutions/economic policy->conditions of entre action-
Entrepreneurship: creating economic opportunities and >entre action-> entre outcomes
introduce ideas into the market in the face of obstacles Institutions = rules of the game (North 1990) —> structure
(uncertainty) = individual level incentives Formal: constitutions, lass, policies, rights,
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Action: firm level regulations Informal: social norms, customs, tradition
-
Individual level: psychological endowments and culture No uncertainty = no failure possible —> productive, unpro. —
institutions (conditions) —> attitudes, skills and actions > must be uncertainty
-
Firm level: culture institutions and business culture Baumol
incentives —> attitudes, skills and actions -
Institutions determine relative payoff —> prevailing rule:
-
Macro level: culture institutions —> attitudes skills action payoff of activity.
(elements) -
-
Productive entrepreneurship: contributed to society and
Attitudes skills action —> startups, entry into new markets, economy —> innovation, job creation, discovery opportu. =
innovations —> variety, competition selection —> no rent seeking purpose
competitiveness and economic growth (impact) -
Unproductive, destructive entrepreneurship: rent see rent-
-
Firm performance —> self-realisation and personal seeking = expenditure of resources in pursuit of economic
wealth, competitiveness, innovations rents by means that don’t break institutions —> drugdeal,
Entrepreneurship hard to measure —> self-employment around prostitution, blackmail, corruption
the longest but self-employed =/ innovation -
Critique Foss et al ch4: no role for uncertainty which can
Week 2 - individual entrepreneur affect all types of entrepreneurial activity (future returns
What makes someone an entrepreneur?
- uncertain), Austrians say productive entrepren. = satisfying
demographics and labor economics —> education, age, needs consumers —> when judgement correct
gender —> human capital and talent Stenholma, Acs, Wuebker 2013
-
Access to financial capital -
- Rate of entrepreneurial activity: newly registered businesses
Psychology: personality —> openness, conscientiousness, per 1000 working people
extraversion, agreeableness, neuroticism -
Type: entrepreneurial aspirations
-
Sociology: networks -
Scott’s institutional pillars impact rate and type
-
Context -
Regulative: regulation, policies, rules law —> quantity : too
Occupational choice: individuals rationally weigh the expected
many/little can (de)motivate —> how easy is it to be come
outcomes and underlying risks, given their perceived
entrepreneur
entrepreneurial skills —> entrepreneurship is alternative -
occupational choice —> opportunity cost Sorgner & Fritsch Cognitive: perceptions of opportunities, perceived skills —>
hypotheses patterns of thinking
-
-
Occupational unemployment risk and entrepreneurship —> Normative: social norms, values, beliefs, —> frowned
switch to self-employment easier when there is a higher upon or encouraged? —> opinion
, -
Conducive: quality!! —> resources, skills,
technology Foss et al ch4
Political entrepreneurship: governments decision making—
> judgement on uncertainty —>3 differences market and
public: Public finance vs investors, not in price system, no profit
loss test
Institutional entrepreneurship: influence entrepreneurs on
institutions —> outcomes in boat impact policy making. Inst.
Behavior (abiding, evading, altering)
Social entrepreneurship: not primary goal of making profits —
> social value
Foss et al ch5+6 starter
Organisation economics analyses behaviour and strategies of
firms Theory of the firm analyses behaviour and strategies in
market contexts Traditional approaches
-
Industrial economics approach: firm is a unit of production
that employs factors of production under a certain
technology
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