The role of entrepreneurship in economic growth and development models

Author

Salim, Iman

Source

المجلة العلمية للتجارة و التمويل

Publisher

Tanta University Faculty of Commerce

Publication Date

2020-12-31

Country of Publication

Egypt

No. of Pages

25

Main Subjects

Economy and Commerce
Financial and Accounting Sciences

Topics

• Economics
• Economic development
• Economic structure
• Industrial processes
• Data

English Abstract

For decades, the entrepreneur was considered the” invisible man”.

The role of entrepreneurship was ignored in economic literature until the 20th century and in economic growth and development models until the early the 1990s.

Since then, the role of entrepreneur is included in different branches of economics.

The purpose of this paper is to review the role of the entrepreneurs and entrepreneurship in economic growth and development models.

After being considered an invisible man in the economics literature, Schumpeter 1911, 1934 considered economic development as a dynamic process that disturbs the closed circular flow of the economic system.

Schumpeter considered the entrepreneur as an innovator who plays a fundamental role in the process of economic development.

However, few attempts have been made to include entrepreneurship in neoclassical and general equilibrium growth and development models due to the assumptions of perfect competition, static market equilibrium and perfect information about markets and production processes.

Endogenous growth models (Romer 1986, 1990; Lucas 1990; Schmitz 1989; Aghion and Howitt 1992) make it possible to include entrepreneurship and entrepreneurs in growth models by emphasizing the role of knowledge externalities, innovations and returns to scale.

They consider entrepreneurship as the channel through which these processes affect economic growth.

The paper also reviews empirical studies using three macroeconomics databases to describe the entrepreneurial impact on growth, productivity and employment.

JEL Codes: B00, O00, O11

Data Type

Conference Papers

Record ID

BIM-1093380

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