Joseph Schumpeter (1883–1950) advanced the concept by associating entrepreneurship with innovation, defining entrepreneurs as creators of economic and societal change. His theory of ”creative destruction” described how innovation disrupts existing markets, fostering growth. Schumpeter also recognised entrepreneurial contributions within established firms, distinguishing entrepreneurs from capitalists, who primarily provided resources. Later thinkers expanded these ideas. Frank H. Knight (1885–1972) emphasised entrepreneurship’s role in managing uncertainty, while Israel Kirzner (1930–) focused on opportunity discovery, viewing entrepreneurs as market equalisers rather than disruptors. Together, these perspectives highlight entrepreneurship’s evolution from project management to innovation and opportunity-driven economic leadership. From an analysis of Schumpeter, Knight and Kirzner’ work, it can be concluded that entrepreneurs operate through three fundamental stages: (i) discovery, (ii) evaluation, and (iii) implementation seen in (see Figure 6.1). Figure 6.1: Operating model of entrepreneurs towards innovation that drives change 6.2 The Position of the Entrepreneur in Economic Theory The entrepreneur is essential to the economy, and their role must be framed within economic theory. As previously discussed, economists such as Kirzner, Knight, and Schumpeter emphasise that the ability to generate market momentum is central to entrepreneurship. As highlighted by Crumpton (2012), entrepreneurs act as agents of change by practically applying ideas and infusing resources into the market. This process is inherently dynamic, involving continuous adaptation and innovation. To better understand the impact of this dynamic entrepreneurial activity, we will now explore its effects through three economic models: Keynesian, Real Business Cycle (RBC), and Austrian economic theories. Keynesian economics suggests that fluctuations in aggregate demand present both challenges and opportunities, particularly during periods of economic boom or downturn. Entrepreneurs seize these fluctuations as opportunities to mobilise resources in response to shifting market demands, thereby stabilising or revitalising the economy. entrepreneurship with innovation, defining entrepreneurs as creators of economic and societal change. His theory of ”creative destruction” described how innovation disrupts existing markets, fostering growth. Schumpeter also recognised entrepreneurial contributions within established firms, distinguishing entrepreneurs from capitalists, who primarily provided resources. Later thinkers expanded these ideas. Frank H. Knight (1885–1972) emphasised entrepreneurship’s role in managing uncertainty, while Israel Kirzner (1930–) focused on opportunity discovery, viewing entrepreneurs as market equalisers rather than disruptors. Together, these perspectives highlight entrepreneurship’s evolution from project management to innovation and opportunity-driven economic leadership. From an analysis of Schumpeter, Knight and Kirzner work, it can be concluded that entrepreneurs operate through three fundamental stages: (i) discovery, (ii) evaluation, and (iii) implementation seen in (see Figure 6.1). Figure 6.1: Operating model of entrepreneurs towards innovation that drives change 6.2 The Position of the Entrepreneur in Economic Theory The entrepreneur is essential to the economy, and their role must be framed within economic theory. As previously discussed, economists such as Kirzner, Knight, and Schumpeter emphasise that the ability to generate market momentum is central to entrepreneurship. As highlighted by Crumpton (2012), entrepreneurs act as agents of change by practically applying ideas and infusing resources into the market. This process is inherently dynamic, involving continuous adaptation and innovation. To better understand the 33 6.2 The Position of the Entrepreneur in Economic Theory
RkJQdWJsaXNoZXIy ODY1MjQ=