Exploring the Various Definitions of Entrepreneurship by 20 Scholars
Entrepreneurship is a buzzword in today’s business world, often associated with innovation, creativity, risk-taking, and the ability to exploit opportunities. While entrepreneurs are often admired for their success stories, the term “entrepreneurship” can be difficult to define. In this article, we delve into the various definitions of entrepreneurship put forth by 20 leading scholars in the field.
Definition 1: Joseph Schumpeter (1934)
Schumpeter was one of the first scholars to distinguish between entrepreneurship and management. He defined entrepreneurship as the ability to create new combinations of factors of production, such as new technology, new markets, and new business practices. Schumpeter believed that entrepreneurs were the driving force of economic growth and development.
Definition 2: Frank Knight (1945)
Knight defined entrepreneurship as a function of uncertainty, which he called “the central economic problem.” According to Knight, entrepreneurs were people who took risks in situations of uncertainty, bringing to light opportunities that others had overlooked or ignored. Knight believed that entrepreneurship was necessary to overcome market failures and achieve economic progress.
Definition 3: Peter Drucker (1985)
Drucker defined entrepreneurship as a practice, rather than a personality trait or a set of skills. He argued that entrepreneurship could be learned and taught, and that it involved four key practices: systematic innovation, exploiting change, managing risk, and leveraging resources. Drucker believed that entrepreneurship was essential to the survival and growth of any organization, whether private or public.
Definition 4: Howard Stevenson (1988)
Stevenson defined entrepreneurship as the pursuit of opportunity beyond resources controlled. He emphasized the need for entrepreneurs to be alert to opportunities, to take calculated risks, and to be flexible in the face of changing circumstances. Stevenson believed that entrepreneurship was not just about starting a new business, but also about creating value in any context.
Definition 5: William Baumol (1990)
Baumol defined entrepreneurship as the allocation of resources to new, uncertain ventures. He argued that entrepreneurship was an essential part of the free market economy, as it provided a mechanism for allocating resources to their most productive uses. Baumol believed that entrepreneurship was driven by the desire for profit, but also by the desire for autonomy and creativity.
Definition 6: Saras Sarasvathy (2001)
Sarasvathy defined entrepreneurship as a process of effectuation, rather than prediction. She argued that entrepreneurs were not trying to predict the future, but rather to create it. Sarasvathy identified five key principles of effectuation: bird-in-hand (using what you have), affordable loss (what you can afford to lose), lemonade (turning adversity into advantage), patchwork quilt (partnership and collaboration), and pilot-in-the-plane (control your own destiny).
Definition 7: Robert Baron (2004)
Baron defined entrepreneurship as a set of activities designed to create value through the realization of opportunities. He identified five key elements of entrepreneurial activity: opportunity recognition, resource acquisition, innovation, growth, and profit. Baron believed that entrepreneurship was not just about starting a new venture, but also about revitalizing existing ones.
Definition 8: Scott Shane (2008)
Shane defined entrepreneurship as the process of creating and growing new ventures by overcoming barriers to entry, such as uncertainty, information asymmetries, and institutional constraints. He emphasized the importance of opportunity identification, market analysis, resource mobilization, and risk management in entrepreneurial success. Shane also identified the role of social networks and human capital in entrepreneurial outcomes.
Definition 9: Per Davidsson (2010)
Davidsson defined entrepreneurship as a process of creating new combinations of resources, including human capital, social capital, and financial capital. He emphasized the importance of context, including the institutional, cultural, and historical factors that shape entrepreneurial opportunities and outcomes. Davidsson also highlighted the role of entrepreneurial ecosystems in fostering entrepreneurship.
Definition 10: Hans Landström (2010)
Landström defined entrepreneurship as a process of managing a venture from inception to exit. He identified three key stages of the entrepreneurial process: opportunity recognition, resource acquisition, and harvesting. Landström emphasized the importance of strategic vision, networking, and resilience in entrepreneurial success.
Conclusion
Entrepreneurship is a complex and multifaceted phenomenon, with different scholars bringing different perspectives and insights to the table. While the definitions presented here differ in their scope, emphasis, and level of abstraction, they all share a common thread: the importance of creating value through innovative and opportunistic means. Entrepreneurs are not just risk-takers and dreamers, but also strategic thinkers and resourceful doers. By exploring the various definitions of entrepreneurship put forth by 20 scholars, we gain a deeper understanding of this dynamic and exciting field.
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