Entrepreneurs and entrepreneurship play an essential role in today’s global business environment. Entrepreneurs are the seeds of industrial development; the fruits of industrial action are employment opportunities and many more. Entrepreneurship development is essential for the growth of the economy. Also, it helps in performing marketing functions properly. Here, we discuss the meaning of entrepreneur and the role of entrepreneurship in economic development.
Meaning of Entrepreneur
The entrepreneur is ordinarily called a businessman. He is a person who combines capital and labor for production. He organizes and manages a business unit assuming the risk or profit. It is called an entrepreneur. In this section, we discuss entrepreneur meaning. According to George Bernard Shaw. He divided people into three categories are:
1st Category: Those who make things happen.
2nd Category: Those who watch things happen.
3rd Category: Those who are left to ask what happened.
Generally, entrepreneurs will come under the first category.
Role of Entrepreneurship in Economic Development
Entrepreneurs’ role is to spark economic development by starting new businesses, creating jobs, and contributing to an improvement in various goals and entrepreneurial decisions. It encourages the role of entrepreneurs in economic development.
The significant role of entrepreneurship in economic development is as follows:
1. Encourage Capital Formation
Under economic development, capital formation shows the role of entrepreneurship in economic development. It is the result of net investment, which also increases the rate of saving, and investment is also growing in the rate of saving, which is of great significance. During encouragement of capital formation it shows role of entrepreneur in economic growth.
2. Employment Creation
In economic growth role of the entrepreneur is to create employment. Under this, employment occurs when people are without work and seeking work. It is a situation where people who are willing and capable of working are unable to find unemployment. It is the role of entrepreneurship in economy.
3. Creation of Job Opportunities
A new business start, and small and large-scale entrepreneurship start. Entrepreneurs set up more and more units. So, small and large-scale job opportunities are helpful for other employees as the role of entrepreneurship in economic development.
4. Creating Employment Opportunities in the Future
When enterprises grow, and firms start and grow, creating jobs has to continue as they provide many more direct and indirect employment opportunities.
5. Provide Immediate Employment
Entrepreneurs provide immediate large-scale employment to the unemployed. As it is a chronic problem in underdeveloped nations. That shows the role of entrepreneurship in economic development.
6. Economic Independence
Entrepreneurship is important for national self-reliance. In economic growth role of entrepreneur is to provide economic independence. Industrialists helped manufacture substitutes for imported products. Also, in reducing dependence on foreign countries. Economic independence shows the role of entrepreneur in economic development. However, it is the role of entrepreneurship in economic development. It does not emerge and grows spontaneously.
7. Overall Development of Area
Entrepreneurs multiplies their entrepreneurial activities, thus creating an environment and the area’s overall development.
8. Create New Firm and Business
The creation of new firms and businesses is important because these new firms contribute to the economy. These can contribute through benefits. The creation of new firms and businesses is the main contribution of entrepreneurship in economic development. These are production process innovations, increased revenue and job opportunities. However, the role of entrepreneurship in economic development is vital.
9. Elimination of Poverty
One of the significant causes of poverty is unemployment. Since entrepreneurship is engaged with employment generation, then, by extension, the employment era will reduce poverty. Wealth created will reduce poverty by empowering the citizens and increasing their access to the necessities of life.
10. Promoted country Export
Entrepreneurs produce quality goods and services at lower prices. Also, export high amounts of foreign exchange from exports.
11. Community Development
Economic development does not always translate into community development. However, it requires infrastructure for education and infrastructure needed for education and training, healthcare, and other public services.
12. Reduction in Crime Rate
Employment generation through entrepreneurial activities will reduce the crime rate. It is firm that unemployment is responsible to a large extent for the level of crimes.
13. Raising the Standard of Living
Entrepreneurship by creating productive organization helps make a wide variety of goods and services available to society at lower prices. It improves their standard of living. An increase in the people’s standard of living is a characteristic feature of the country’s economic development. Therefore, an increase in standards shows the role of entrepreneurship in economic development. Further, Entrepreneurship through job and wealth creation raises people’s standard of living.
14. Optimism Utilization of Resources
Wealth is created and stimulates the creation of new firms. It results in optimum use of economic resources, such as labor, capital and technology, to the fullest extent.
15. Rural Development and Reduction in Migration
Entrepreneurs stipulate rural development by setting up businesses in rural areas. Further, rural entrepreneurial activity by generating employment removes urban-rural shortcoming in income and economic opportunities. Thus, it decreases the movement of rural area people to urban areas.
16. Increase in GNP and PCI
They explore and exploit opportunities, encourage effective resource mobilization, bring in new products and services and develop markets for the economy’s growth. In this way, the role of entrepreneurship in economic development helps increase the gross national product and per capita income of the people in a country. An increase in the rate of gross national product and per capita income of the people in a country is a precondition of rapid economic growth.
In the end, entrepreneurship plays a crucial function in economic improvement. It promotes innovation, activity introduction, and productiveness, which are all vital for sustainable monetary growth. Entrepreneurs pick out marketplace gaps and create new services or products to satisfy those needs, contributing to the diversification of the financial system. They also stimulate opposition, leading to lower fees and progressed first-class.
What is the Role of Entrepreneurship in Economic Development?
Entrepreneurship performs a good sized role in economic improvement. It allows to promote innovation, productivity, and task introduction, all of which might be crucial for sustainable economic boom. Entrepreneurs are critical drivers of economic growth and improvement, as they discover marketplace possibilities and create new businesses that cater to the desires of clients.