Summary
Baumol Text - Summary
- Course
- Institution
UU Introduction to Economics and Business Economics - Summary for William Baumol Text 'Entrepreneurship: Productive, Unproductive, and Destructive' (1990)
[Show more]
Seller
Follow
bjornlabrie
Reviews received
Content preview
Summary – Entrepreneurship – Baumol:Entrepreneurship: Productive, Unproductive, and Destructive (1990). William J. Baumol.
The total supply of entrepreneurs varies among societies there is even more variety in
productive contribution to entrepreneurial activities, because of the allocation between
productive and unproductive activities policy can influence this allocation.
Entrepreneurship is a big part of the economy need for achievement and innovation.
Slow economic growth decline in entrepreneurship is blamed.
Baumol’s Hypothesis entrepreneurs always play a substantial role the set of rules
undergo significant changes from one period to another these rules help to dictate the
effect on the economy via the allocation of resources the rules can be observed, described
and modified and improved the rules and its consequences determine the effect on the
economy the variety of (relative) rewards for entrepreneurial activity have effect on
patterns in entrepreneurial behaviour the changing rewards, in other words the
reallocations, have influence on behaviour and therefore have influence on the growth and
direction of an economy.
Allocability of entrepreneurial effort between productive and unproductive activity helps to
account for the phenomenon of economic changes in prosperity (due to reward changes).
Rules of the game = the system of entrepreneurial rewards (changes / reallocations).
Changing the rules of the game stimulating productive contribution to entrepreneurship.
Schumpeterian Analysis a minor extension in this slightly shortcoming model can explain
the allocation of entrepreneurial input analysis of these inputs does not promise to lead to
conclusions expanding the Schumpeter list will lead to more results the list, now only
consisting of productive contributions, should have unproductive contributions added to it.
Concept 1) new product / new quality of product 2) new method of production 3) new
market 4) new source of supply of raw materials 5) new organisation.
Entrepreneurship can be unproductive or even destructive this depends on the rewards /
payoffs different reward systems: Roman (landholding / usury / political payments),
Medieval Chinese (bias, status), Earlier Middle Ages (military activity / warfare, family),
Later Middle Ages (architect-engineers / religion / technological innovations /
entrepreneurship = monopolies), 14th century (military inventions), Early Rent-Seeking
(unproductive contribution, new ways of gaining wealth).
If entrepreneurship is the imaginative pursuit of position, we can expect changes in the
structure of rewards to modify the nature of the entrepreneur’s activities the rules of the
game can then be a critical influence helping to determine whether entrepreneurship will all
be allocated to productive, unproductive or destructive activities.
Internet:
Entrepreneur = someone who sets up a business, taking on financial risks in the hope of
gaining profit (personal savings as capital or convincing investors to finance the ideas).
Entrepreneurship = one of the resources economists categorise as integral to production, using
a business plan to manufacture goods or provide services it is empirical and theoretical.
Conjecture = a conclusion based on incomplete information.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller bjornlabrie. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.24. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75057 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now