🔵 Watch the video so you know what are the main ENTREPRENEURSHIP ROLE IN ECONOMIC DEVELOPMENT, as well as the ENTREPRENEUR CHARACTE...
🔵 Watch the video so you know what are the main ENTREPRENEURSHIP ROLE IN ECONOMIC DEVELOPMENT, as well as the ENTREPRENEUR CHARACTERISTICS. Discover in 18 minutes, 27 ROLE IN ECONOMIC DEVELOPMENT, and ENTREPRENEUR CHARACTERISTICS.
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On this occasion we will know the main roles of entrepreneurship in economic development, as well as their characteristics.
Life itself is full of challenges and in those challenges there are many forms of innovation and creation of new products and values for the market that an entrepreneurship can bring.
Next we will describe 27 roles of entrepreneurship in economic development, as well as we will describe the characteristics of the entrepreneur.
And stay until the end of the video since we will describe which characteristic is the best or most important for an entrepreneur.
Every year new needs and new challenges are presented to the human being worldwide and it is the entrepreneurs who are called to cover these needs with the creation of new products.
As I have already described in previous videos, entrepreneurship is defined as the act of creating, innovating and establishing a business, assuming financial risks waiting for profits.
Entrepreneurship in the form of a company offers a product, a process or service for the sale or hire of professionals or individuals, contributing to the general economic development of a community.
Entrepreneurship is known for the high risks involved in launching a startup.
The fact is that people often suffer failures on their way to success, and some companies have to close due to lack of funds, sales decisions or lack of demand in the market.
That is why the entrepreneurial spirit is mainly seen as something risky and outside the comfort zone.
The company needs courage to realize their dreams and see possibilities, solutions and opportunities for the future where others only see problems.
Having described the above, we now list 25 roles of entrepreneurship in economic development.
Role number 1. The company is the engine of economic development - why is it true?
This may be the most widespread role of entrepreneurship and, in itself, developing countries must focus on long-term entrepreneurship to have stable economic development.
In recent decades, the role of entrepreneurship in economic development has become an essential factor in employment, and innovations bring more competition to the market.
Starting with the same person who starts the company, each new business launched has an impact on an economy and affects the people around it.
Role Number 2. It helps eliminate disparities between regions.
With the entry of new products that end up becoming new values for the market, entrepreneurship helps eliminate disparities between regions through an implementation of the industry in the field and less developed areas.
When there is balanced regional development, entrepreneurs who create new businesses and industrial units help with regional development by locating themselves in less developed areas.
The growth of industries and businesses in these areas leads to improvements in infrastructure, which is why governments promote this type of regional development by providing registered MSMEs with various benefits and concessions.
Role number 3. Entrepreneurship extends economic power.
The power of the economy is, in fact, the natural consequence of industrial and commercial activities.
Industrial development is sometimes based on a concentration of economic power of only a few, while entrepreneurship and business growth act to counteract that concentration.
Entrepreneurship is a force that multiplies the players of an economy and reduces the concentration of economic power.
Role Number 4. Entrepreneurs create and distribute wealth.
When starting a new entrepreneurial idea, entrepreneurs invest their own resources, or seek investment funds for their new idea and attract investment (in the form of debt, capital, etc.) from investors, lenders and the public.
This mobilizes public wealth and allows people to benefit from the success of entrepreneurs and growing businesses.
This type of pooled capital that results in the creation and distribution of wealth is one of the basic imperatives and objectives of economic development.
Role Number 5. Improve the quality of life of a population.
This is an indirect role of entrepreneurship, since improving the quality of life of a population is a characteristic of economic development.
Entrepreneurs play a vital role in improving the quality of the lifestyles of our communities and people; They adopt the latest innovations in the production of vast and various large-scale goods and services to reduce the cost.
A clear example is the advancement of technological development in cell phones, which today is not a problem to communicate anywhere in the world, which until 30 years ago less developed countries had problems in it.
Role Number 6. Contributes to the exports of a country.
In the case of agroindustrial entrepreneurs, for example, a country's exports and improve the trade balance that is important in economic development.
Any growing business will eventually want to start with exports to expand its business to foreign markets.
This is an important ingredient of economic development, as it provides access to larger markets and leads to foreign exchange inflows and access to the latest cutting-edge technologies and processes used in more developed foreign markets.
Role Number 7.- Entrepreneurship fosters innovation.
Entrepreneurship requires innovation and recent history shows us that with every new invention new millionaires emerge, a clear example is the innovations and entrepreneurship of the internet, which has changed the lives of millions of people.
An entrepreneur is first and foremost someone who has new ideas, who creates and innovates to solve a problem.
An entrepreneur accepts change and tries to maximize profits while innovating. When a company approaches a business driven by the evolution of technology, it fosters the country's economic development.
Role number 8. Improvement of the standard of living of the country.
The entrepreneur may think that he is simply working hard to build his own business and support himself and your family, but in the long term he is doing much more for his local community, state, region and the country in general.
This is because they adopt innovations that lead to improvements in the quality of life of their employees, customers and other stakeholders in the community.
For example, automation that reduces production costs and allows faster production, will make a business unit more productive, while also providing its customers with the same products at lower prices, and in the long term will achieve industrialization of your product.
Role Number 9. Create jobs.
To start when you become an entrepreneur, there is a job seeker less in the economy, and then provides employment to other job seekers.
This type of job creation by new ventures and existing ventures is again one of the basic objectives of economic development.
All this in turn creates many job opportunities and is helping to raise our standards to a global level.
Entrepreneurs generate employment both directly and indirectly. Directly, self-employment as an entrepreneur offers the best independent and honorable way of life.
Indirectly, by establishing small and large-scale business units, they offer jobs to millions. Therefore, entrepreneurship helps reduce the problem of unemployment in the country.
Role Number 10. GDP and per capita income.
This role of entrepreneurship is one of which is developed when the entrepreneur has already established his product on a medium scale; For example, entrepreneurship in India, consisting of 36 million units that provide employment to more than 80 million people, now accounts for more than 37% of the country's GDP.
Each new addition to these 36 million units uses even more resources such as land, labor and capital to develop products and services that add to the national income, the national product and the per capita income of the country.
This growth in GDP and per capita income is once again one of the essential objectives of economic development, which essentially means a process of upward change through which the real per capita income of a country increases over a period of time.
Role Number 11. Capital formation.
By presenting their product to the market, entrepreneurs mobilize inactive savings from the public.
The investment of public savings in the industry created by the entrepreneur results in the productive use of national resources.
The capital formation rate increases, which is essential for rapid economic growth. Therefore, an entrepreneur is the creator of wealth.
Role Number 12. Economic independence.
This role of entrepreneurship is essential for national self-reliance.
The industrial development generated by entrepreneurs, helping to manufacture national substitutes for imported products, thus reducing dependence on foreign countries, this together with large-scale export, achieve foreign exchange for the country.
Such import substitution and export will help the country's economic independence, since without it, political independence has little meaning.
Role Number 13. Links back and forth.
This role of entrepreneurship occurs when a new business is created since this starts a change that has a chain reaction.
The creation of a company has several links back and forth, for example, the establishment of a steel plant for construction generates several auxiliary units and expands the demand for iron ore, coal, etc.
These are back links, as the supply of steel increases, the plant facilitates the growth of machine construction, tube manufacturing, utensil manufacturing and other similar units.
Role Number 14. Sub Developed Regions.
Although entrepreneurs contribute more in favorable opportunity conditions, it is the role of entrepreneurship to improve the economic climate in underdeveloped regions, although due to the lack of funds and skilled labor, the environment is less conducive for innovative entrepreneurs.
Under conditions of shortage of funds and the problem of the imperfect market, entrepreneurs are obliged to start their small-scale businesses. The advantage of these ventures is that they are preferred in such regions.
Under this concept, the initiation of innovations introduced in large-scale developed regions produces rapid economic development in underdeveloped or developing regions.
Role Number 15. Inspire others towards entrepreneurship.
The team created by an entrepreneur for your new company often provides the opportunity for employees and teammates to have a first-hand experience of getting involved in an entrepreneurial company.
This often leads to these employees becoming entrepreneurs after being inspired by their previous experience of working for an entrepreneur.
Therefore, this process helps to form a chain reaction of business activity that contributes directly to the health of the economy.
Role Number 16. Create knowledge overflows.
When some key personnel of a successful company leaves an organization to create a new company, the knowledge acquired by it in the organization overflows to the new firm.
Therefore, the entrepreneurial spirit serves as a mechanism by which knowledge extends to a new company in which the new company benefits, of course, benefits from the experience and knowledge acquired by the founder of its former organization.
Knowledge is embodied in a worker and the new company is created through the effort of the worker to appropriate the value of his knowledge through an innovative activity.
Role Number 17. Increase the number of companies.
When entrepreneurs create new products, the number of companies based on new ideas or products established in a region's market increases.
An increase in the number of companies not only improves competition for new ideas, but greater competition among companies also facilitates the entry of new companies specializing in a particular new product niche.
Glaeser (1992), as well as Feldman and Audretsch (1999), found empirical evidence that supports the hypothesis that an increase in competition within a city, measured by the number of companies, is accompanied by a higher growth performance of that city.
Role number 18. Provide diversity in companies.
Industrial activity in an area generally results in the production of a variety of businesses in that same area.
For example, the new dropshipping trend has generated a variety of new needs in this market, ranging from telecommuting, remote employees, courier and delivery services, etc.
And this as a new market, according to Jacobs (1969), is the exchange of complementary experiences between numerous companies and economic agents that produces an essential return on the new economic knowledge.
Role Number 19. Organization of the productive resources of the society.
This important role of entrepreneurship in economic development is the optimal use of the country's productive resources for the benefit of individuals. James Burns observes that an entrepreneur is the organizer of the efficient resources of society.
When discussing the contribution of entrepreneurs composed by Professor Karvar, the services of an entrepreneur are such that a paid supervisor can not perform them. In the absence of entrepreneurs, all productive resources stay inactive.
Role number 20. Production of new articles.
This role is closely related to innovation, the entrepreneur plays an important role in the production and presentation of new products in the market, Innova and identifies the possibility of producing new products based on innovation.
Role number 21. Development of new production techniques.
The entrepreneur uses the new methods of production techniques and brings to the market varieties of products at reasonable prices. It strives to improve current production technology.
Role number 22. Contributes to the creation of an industrial climate.
The entrepreneur plays an important role in the construction of the industrial climate in the country, motivates other entrepreneurs to also invest in industrial activities, which is a larger-scale role for economic development.
Role number 23. Ambassador of social changes.
With the advent of the Internet, companies such as Google or Facebook have made social changes around the world, access to information is not the same problem as 30 years ago.
Entrepreneurs are ambassadors of social changes in an economy, new inventions cultivated a scientific perspective among people who abandoned their traditional beliefs and attitudes.
Role number 24. Skills development.
Entrepreneurs play a vital role in the development of skills and, therefore, contribute to the process of job creation and development of the economy, entrepreneurs take the initiative to improve the capacity of the semi-skilled or unskilled labor force.
Role number 25. Creation of an innovative change.
An entrepreneur is a person who always looks for changes, the continuous dream helps in the creation of ideas and the creation of ideas facilitates creative innovations, viable innovations lead entrepreneurial behavior.
When new ideas are presented, a new combination of factors is presented, the entrepreneur always tries to introduce new and better techniques of production of goods and services, therefore, an entrepreneur leads economic development through continuous innovations.
A catalyst that results in a commercial activity is needed to a large extent, the diversity of activities that characterizes rich countries can be attributed to the offer of entrepreneurs.
Role number 26. National production.
The basic problem in any economy is the result of the shortage of goods and services. The shortage of goods reflects the lack of adequate production.
As a result, society would be forced to meet the requirements of its people by importing goods and services, which is negative for the country's foreign exchange reserves.
In the long term, entrepreneurship generates a development that stimulates the economy with greater production of goods that not only satisfy internal demands but also serve exports.
Role number 27. Reinvestment of earnings.
The investment or capital necessary to establish any entity is the most important resource of which there is a great shortage in most developing societies.
This situation often forces decision makers and members of the government to invite businessmen, nationals and foreigners, including multinational companies, from abroad to establish industries in their territory.
As a result, the profits obtained by the private sector are likely to be returned to the places where investors belong. This results in the flight abroad of the capital from the region where the industry was established, however, it is a necessary evil.
It is here that entrepreneurs have a very important role, regardless of the earnings and where they get them, they will naturally invest in the same region directly or indirectly and will lead to further development of that region.
What is the best characteristic of the entrepreneur?
As we promised at the beginning of the video, we will describe in our opinion the best characteristic of the entrepreneur.
As we have already mentioned in an earlier video, the entrepreneur must be innovative, bold, risky and requires that he do a lot of his part in the beginning of his business, which in the long term finds very rewarding results, such as free time and profits potential.
There is an important characteristic that characterizes successful entrepreneurs which, together with innovation, go hand in hand and is a quality that allows to achieve potential business achievements.
In our opinion the most important characteristic is to help others.
When an entrepreneurial mindset is in search of an innovative idea, this idea is in order to cover a need that people have, and therefore a person who helps others will find it easier to find their innovative idea.
Successful entrepreneurship is about helping as many people as possible to solve their problems and that is why innovation together with the idea of helping as many people as possible make it possible to obtain great results in the long term.
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