Entrepreneurship – A Growth factor for The Economy
Entrepreneurship has long been considered a crucial mechanism of economic development, the entrepreneur has been a fundamental agent in most production, distribution, and growth theories. The role of entrepreneurship as the driving force of economic growth. Entrepreneurs boost economic growth by introducing innovative technologies, products, and services.
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Entrepreneurship is important to economic development. The benefits to society will be greater in economies where entrepreneurs can operate flexibly, develop their ideas, and reap the rewards. Entrepreneurs respond to high regulatory barriers by moving to more innovation-friendly countries or by turning from productive activities to non-wealth-creating activities. To attract productive entrepreneurs, governments need to cut red tape, streamline regulations, and prepare for the negative effects of layoffs in incumbent firms that fail because of the new competition.
Entrepreneurship is recognized as something worth to be promoted because entrepreneurial skills and attitudes provide benefits to society. Entrepreneurs contribute to the growth and development of the economy through the following.
- Creates job opportunities
We are in an error that most developing countries have high unemployment rates, and most people go through the education system only to become unemployed, thanks to entrepreneurship where one can identify a niche and start their own business Entrepreneurs stimulate employment growth by generating new jobs when they enter the market. As times go by, the businesses grow and there is a need to add more workforce. Entrepreneurs help to reduce the number of job seekers in the economy and add the number of job creators.
- . Effective utilization of resources
Entrepreneurship is all about putting to better use the resources which are considered to be of low value with an aim of earning income. An entrepreneur comes up with ideas of how to use what others may consider waste. This improves the economy of a country through taxes and the creation of jobs which improves the standard of living of the beneficiaries.
- Improvement in per capita income
Entrepreneurs help to increase the per capita income of the country in various ways and facilitate the development of backward areas and weaker sections of the society, they explore opportunities and exploit them. They convert talent and idle resources like land, labor, and capital into national income and wealth as goods and services. They help increase the net national product and per capita income in the country, which are important indicators for measuring economic growth.
- Capital formation
A country can attain economic development only when there is more amount of investment and production. Entrepreneurs help in channelizing their savings and savings of the public to productive resources by establishing enterprises. They promote capital formation by channelizing the savings of the public to productive resources.
- Growth of infrastructure
The infrastructure development of any country determines the economic development of a country, Entrepreneurs by establishing their enterprises in rural and backward areas influence the government to develop the infrastructure of those areas. People venture into different businesses that they set up infrastructures like schools, hospitals, and supermarkets and for people to access the social amenities, there is a need for the government to establish these places to meet certain standards.
- Brings about innovation.
Innovative entrepreneurship has to do with overall changes in the nature and structure of the economy, upgrades of technology and technical know-how, updated economic productivity, and valuable service provisions. Through the right practices of research and development, entrepreneurs bring new innovation that opens the door to new ventures, markets, products, and technology. By bringing innovation to every aspect of businesses, entrepreneurial ventures enhance production by utilizing the existing resources in the most effective ways. Entrepreneurs develop new markets by introducing new and improved products, services, and technology. Thus, they help generate new wealth and add more to the national income. So the government can offer the citizens more national benefits.
- Economic Integration.
Entrepreneurs reduce the concentration of power in a few hands by creating employment opportunities and through equitable distribution of income. Entrepreneurs promote economic integration in the country by adopting certain economic policies and laws framed by the government. They help in removing the disparity between the rich and the poor by adopting the rules and regulations framed by the government for the effective functioning of business in the country.
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To sum up, supporting and promoting entrepreneurship can have a positive impact on the country’s economy and even existing businesses, and social entrepreneurship increases the likelihood of finding innovative solutions to social challenges faced by communities around the world.
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