This document entails lecture notes from all 8 lectures of the course Economics of Entrepreneurship.
1) The Role of Entrepreneurship in Society and the Economy
2)The Individual Entrepreneur
- Article Kautonen et al.
- Article Sorgner et al.
3)Institutions and Entrepreneurship
4)Organisation...
LECTURE 1-THE ROLE OF
ENTREPRENEURSHIP IN SOCIETY AND
THE ECONOMY
WHAT ROLE DO ENTREPRENEURS PLAY IN OUR SOCIETY AND ECONOMY
Entrepreneurship: you are seeing a gap in the market
Local entrepreneurship: e.g., a coffee place and neighborhood home
CLASSIC VIEWS ON ENTREPRENEURSHIP
Knight: There is form of uncertainty that is not quantifiable. Decision making that entrepreneurship do is more
based on heuristics; it is about interaction with the environment, decisions are not necessarily rational and
most optimal → judgement-based approach
Kirzner: entrepreneurs are those who are most alert to opportunities that arise from the market. It suggests
that it is someone who happens to follow upon an opportunity and solves that. Not very pro-active and
innovative. Alertness is a thing entrepreneurs do. They react on the opportunity.
Sarasvathy: the idea that they are not necessarily these people that are accidentally there in the right time and
place, but they have certain characteristics. Why are some good at it and why are some not? Affectuation and
opportunity creation; they can push it into society and mobilize everyone around them to make it happen.
Schumpeter: why can markets be changed to a big extent. Key figure responsible for creating creative and
innovative destruction in our society. The kind of entrepreneurship that introduces new products and
technologies and serves as a conduit of knowledge to generate innovation and growth. The entrepreneur is
responsible for introducing such innovation into the market, as the primus motor of economic growth.
Austrian economics:
- Methodological individualism
- Importance of uncertainty and subjectivity entrepreneurial decision-making (over time and across
place)
- Tacit and dispersed knowledge
- Heterogeneity of capital
,Structural: what do we observe as the structures of entrepreneurship?; start-ups, scale-ups
Functional: process of entrepreneurship; entrepreneurship is behavior
ELERT ET AL.
Karl popper’s open society based on contestable knowledge and validation of knowledge through falsification.
You can make an hypothesis and test them
How a firm creates impact on society.
WENNEKERS & THURIK
Entrepreneurship is the manifest ability and willingness of individual on their own, in teams, within and outside
existing organizations to
- Perceive and create new economic opportunities
- Introduce their ideas in the market, in the face of uncertainty and other obstacles by making decisions
on location, form and the use of resources and institutions
It is a role and skill, a behavior. You can become entrepreneurial over time for instance.
,SCHUMPETERIAN ENTREPRENEURSHIP IN LARGE BUSINESSES
- Creative destruction, new product market combinations
- Large firms can be entrepreneurial as well.
- Intrapreneur: individual in a company that produces innovation
SELF-EMPLOYMENT RATES
Self-employment does not mean you are an entrepreneur; not necessarily innovative. Self-employment rates
increase.
ARTICLE KAUTONEN ET AL. (2015)-
ROBUSTNESS OF THE THEORY OF
PLANNED BEHAVIOR IN PREDICTING
, ENTREPRENEURIAL INTENTIONS AND
ACTIONS
ABSTRACT
Relevance and robustness of the Theory of Planned Behavior in the prediction of business start-up intentions
and subsequent behavior based on longitudinal survey data.
Two weaknesses in current research:
- Limited scope of samples used
- Scarcity of investigations studying the translation of entrepreneurial intentions into behavior.
INTRODUCTION
Entrepreneurship is intentional behavior, the formation of an intention to start a business is a step in the
process of founding an organization.
➔ Theory of planned behavior: strength of intention is an immediate antecedent of behavior.
➔ Applications in business start-up context have been limited to explaining the formation of intentions.
o No focus on business start-up intentions
o Use of limited sample sizes
o Scarcity of studies including the intention-behavior relationship
THEORY OF PLANNED BEHAVIOR
TPB→ posits that beliefs about attitude, control and norms influence behavior and are mediated by intentions.
Intention→ a person’s readiness to perform a given behavior.
- attitude refers to the individual’s evaluation (favorable or unfavorable) of the target behavior.
- subjective norms capture the opinions of social reference groups (such as family and friends)
regarding whether the individual should engage in the behavior; and
- perceived behavioral control (PBC) denotes the perceived ease or difficulty of performing the behavior
Shapero and sokol’s entrepreneurial event model→ explains intention son the basis of perceived desirability,
perceived feasibility and the propensity to act.
Not all behaviors that eventually lead to a start-up are intended as such when they are performed (hobbyist
who gradually discovers that a business can be made from the hobby.)
Effectuation theory→ means-driven individuals can take enterprising action without necessarily having the
ultimate goal of an independently owned business in mind. The intention to start a business is not necessarily
the starting point of the entrepreneurial process.
This study contributes to the creation of a body of evidence on the impact of intention on subsequent behavior
in the business start-up context by investigating whether those with intentions to take steps to start a business
in a defined upcoming period (a year) will actually take subsequent action over that period. (not whether the
ownership of a business was originally, early, or consciously desired or planned.
RESULTS
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