An Outline of the Concept of Entrepreneur: The entrepreneur in modern times
The skillful entrepreneurs best combine the services that generate utilities (that confers value to merchandises) of human, capital and nature factors. In order to procure them, they pay salaries, interests and/or rentals; they use and combine them so that they offer the market the goods and services demanded.
In Germany, there is a distinction between entrepreneur and manager: “The entrepreneur is subject to specific concerns and agitation related to the business world; he does not sleep for nights, he is only preoccupied by the thought of avoiding failure. On the other hand, the manager, if he did a great job during the day and if he is tired, he may have a deep sleep, without any concerns, with the consciousness of his fulfilled tasks” (Low & MacMillian, 1988). The entrepreneur is considered both an innovator and a person who assumes risks, as his income is divided in two: an income pertaining to the “entrepreneurial risk” and another one that is due to his “cleverness”.
In U.S., the entrepreneur is different from the capitalist and he is deemed as “the main production agent”. The successful entrepreneur has the power to predict, he has organizational and administrative skills, an exceptional energy and other qualities of a leader. Satisfaction level of teachers
Of all-important modern economists, Joseph Schumpeter was the only one that tackled the problem of the entrepreneur and his impact on the economy. Schumpeter may be considered as the prophet of discontinuity era, since he discusses about the passage from a “managerial” economy to an “entrepreneurial” one, that he calls “essential transformation” of the economy. He presented for the first time his concept of “creative destruction” in the “Theory of Economic Dynamics”.
For Schumpeter, the economic stages did not represent an inevitable progress of the society. In other words, the capitalism was not inevitably followed by socialism. The capitalism could be rekindled and the entrepreneurs have such a mission. This makes Schumpeter different from other economists, according to Peter Drucker, since for the traditional economists, “the entrepreneurship” is a “meta-economical” event that deeply influences and shapes the economy without being integral part of it. Therefore, the entrepreneur is the source of all dynamic changes in the economy, and the capitalist system for Schumpeter can only be understood through the prism of development conditions related to entrepreneurial activity.
In “Capitalism, Socialism and Democracy”, Schumpeter asserts that “such process of creative destruction is the main factor of capitalism”. He is based on his concept of “entrepreneurial profit”. The entrepreneurs reach to such surplus by means of new processes or improvements that prevail over those of their competitors. The new business is then growing up to the stage of oligopoly or monopoly, thus creating an offer surplus. Although the company that holds the monopoly tries to control the market, actually it loses the monopoly because it creates a new profit opportunity for the innovative entrepreneur who will find a new process, an improvement or he will simply replace the product.