FUNDAMENTALS OF ENTREPRENEURSHIP

FUNDAMENTALS OF ENTREPRENEURSHIP

Introduction

Entrepreneurship has, for long been attributed to the private sector based on their initiatives directed towards raising capital to grow their business. However, authoritative series on entrepreneurship shows that the government has a key role since it impacts on how new businesses are created and managed. As such, the government predicts the nature in which the firms grow by developing a favourable environment for the businesses to thrive. There are different types of entrepreneurs in the modern-day marketplace relative to their unique capability and prowess while doing business. Entrepreneurs possess unique characteristics which makes them unique in the market, thus developing a higher position than their counterparts. For instance, world-changer entrepreneurs strive to make the world a better place since they comprehend concepts such as harmony and empathy. However, numerous questions have been raised on whether the government should intervene in differentiating the different types of entrepreneurs.

Argument in favour

The government should intervene to differentiate between the different types of entrepreneurs to maximize social welfare. As such, the government’s intervention should be put in place cartels from developing monopolistic powers against entrepreneurs (Johnson, 2013). For instance, the government should maximize social welfare to distinguish between innovators and hustler entrepreneurs. Social welfare should be utilized by the government to depict the hustlers as hand workers willing to undertake an extra effort to achieve their goals and objectives. On the other hand, social welfare is utilized by the government to perceive them as risk-takers willing to actualize real ideas into viable enterprises (Smallbone & Welter, 2018). Innovative entrepreneurs are passionate and obsessive, thus develops unique business ideas, unlike the hustlers (Entrepreneurs, 2018). The innovative entrepreneurs utilize product differentiation to develop the most viable course of action in business. Hence, the government’s intervention is crucial in differentiating the different types of entrepreneurs.

Besides, the government should intervene in entrepreneurship to provide skills necessary to differentiate entrepreneurs.  The skills are necessary to outline competence levels of the different types of business persons (Audretsch, Grilo & Thurik, 2007). For instance, the government should provide a favourable working environment to enable visionary impresarios to think outside the box through the development of innovative minds (Johnson, 2013). Hence, the visionary business persons would be distinct from the rest since they utilize creativity skills to brand their products and services. On the other hand, skills provided by the government ensure that strategist types of entrepreneurs portray as monetary motivated based on their strategic thinking skills. The government, therefore, should intervene to provide a skills framework to differentiate the entrepreneurs based on their skills competency (Pettinger, 2019).  As such, the tycoons would be in a position to utilize their capability to articulate economic changes.

Also, the government should intervene to outline socio-economic factors based on different entrepreneurs. As such, the government’s intervention would minimize the negative effects of events occurring naturally to the various business people (Smallbone et al., 2010). Thus, the government would be in a position to develop employment laws to protect the different types of entrepreneurs. For instance, survivor entrepreneurs should be protected from poor professional experiences. Also, the government should intervene to enact laws that protect the survivor entrepreneurs from unworthy systems which pose discriminatory acts while carrying out business (Entrepreneurs, 2018). On the other hand, government intervention ensures that laws are passed to promote innovation and creativity among the visionary entrepreneurs. Therefore, government’s intervention creates differences between the two types of entrepreneurs relative to law enactment.

Finally, the government should intervene to differentiate entrepreneurs based on price ceilings. As such, efforts by the authorities would develop different price limits to control how high the cost of goods and services should be perceived. Hence, the government would play a vital role in entrepreneurship by depicting the maximum amount for which products and services should be charged. For example, the price ceiling for world-changer entrepreneurs should be high compared to the survivors (Dubai, 2011). Hence, the government’s intervention ensures that world changers do not offer their products at high prices, thus deeming their services as superior at the expense of the survivors. However, the prices should vary but within the required limits to serve as the differentiating factor between the two levels of entrepreneurship (Pettinger, 2019). Therefore, the government’s intervention is crucial in outlining the disparities between entrepreneurs based on price ceilings.

Arguments against

The government should not intervene in differentiating entrepreneurs since it negatively impacts on personal freedom. Increased governmental intervention in entrepreneurship would shift the behaviour of entrepreneurs who require space to organize and practice their ideas (Smallbone et al., 2010). Thus, the entrepreneurs would not be in a position to live a healthy lifestyle as they prefer being accorded freedom while doing business. In most cases, government regulations lead to the development of laws having a direct impact on behavioral changes to most business persons (Dubai, 2011). for example, the government’s interaction prevents innovative entrepreneurs from utilizing their technical prowess to align with current consumer trends. Therefore, the entrepreneurs are not capable of maximizing technological developments to create products with unique characteristics from other business tycoons (Dzafic & Babajic, 2016). Hence, the government’s intervention hinders innovative entrepreneurs from developing new ideas based on market requirements.

The government should not intervene in differentiating entrepreneurs but rather promote entrepreneurship by creating viable opportunities in the market. As a result, the business persons would be in a position to directly create new market opportunities without external influence from the government (Smallbone & Welter, 2010). however, the government should only create favorable working conditions that promote healthy competition from market players. As such, different types of entrepreneurs such as innovative and social business persons would utilize personal competencies to achieve high market positioning as opposed to government’s intervention (Dzafic & Babajic, 2016). For instance, the government’s intervention makes social entrepreneurs lose their competence to develop and secure investments in foreign markets, thus limiting their capabilities. As such, the authorities should only play an oversight role to oversee operations by different entrepreneurs rather than intervening directly. Also, government’s intervention limits the ability of a solopreneur to plan their schedules based on personal timings and competences.

Moreover, governments intervention in differentiating entrepreneurs leads to the emergence of political pressure groups. As such, entrepreneurs form an organization based on their competences and roles to pressure the government on improving their welfare. As a result, entrepreneurs file numerous lawsuits which destroy the relationships between the authorities and business persons. Consequently, the government fails to meet its legal obligation to the different entrepreneurs due to the lack of mutual coordination between stakeholders. Hence, the authority is left with no choice of dealing with problems faced by entrepreneurs and the need to be differentiated (Dubai, 2011). So, the government should not be involved in differentiating entrepreneurs since it would fail to command the economy. Therefore, business persons should be provided with freedom and a favorable working environment to help them achieve stipulated goals and objectives in the long-term.

Finally, the government should not be directly involved in differentiating entrepreneurs but rather enact laws that increase freedom to carry out business. Government lacks incentives required in the free market thus should not be involved in differentiating business persons. Authorities fail to provide profit incentives to entrepreneurs required to cut costs in the public sector. Thus, the lack of incentives leads to inefficiency in production, which leads to the production of goods not required in the market (Mazzarol, 2014). Besides, the government’s intervention often results in failures which can cause dire economic problems in the long-term. For instance, tariffs by the government aimed at differentiating entrepreneurs have in the past resulted in problems in regards to economic development contracts (Smallbone & Welter, 2010).  Hence, the government’s intervention is likely to cause wrangles between different levels of entrepreneurs; this spells doom for economic growth.

Point of view

Based on the evidence provided in favor and against the government’s intervention in differentiating entrepreneurs, the authorities should not be involved in the process. Government’s intervention jeopardizes risks undertaken by entrepreneurs in their quest to gain from new exploits. As such, by differentiating, entrepreneurs’ regimes fail to harness gainful opportunities provided by entrepreneurs in the competitive marketplace (Mazzarol, 2014). Generally, business persons are self-motivated relative to the risks they undertake while striving to achieve economic growth. Also, entrepreneurs need to take risks which are thus halted with the government’s intervention in differentiating them (Anzisha, 2017). Hence, the government should shun away from differentiating entrepreneurs but instead enact laws promoting free trade to enable business people to develop pertinent skills and knowledge. As such, the entrepreneurship concept would be fully utilized to unearth risks that must be undertaken to achieve economic growth.

The government should approach entrepreneurship using a more efficient strategic approach rather than directly intervening in an entrepreneur’s differentiation (Mazzarol, 2014). As such, the government would be in a position to promote equality among all business persons. Equality would be vital in developing meritocracy required to treat all the entrepreneurs with the respect they deserve with differentiation (Dzafic & Babajic, 2016). Therefore, the business persons would carry out their businesses freely without intimidation from governmental agencies. So, education would be provided to the entrepreneurs to help them actualize external benefits to improve their lives without being differentiating them based on their capability. Besides, the lack of government intervention would guarantee a shift in consumer behavior relative to the cost of carrying out business.

Conclusion

The report shows that entrepreneurship has over the years been attributed to be useful only in the private sector.  However, the government has constantly increased intervention in differentiating entrepreneurs based on their skills and competence. Arguments supporting government intervention has been outlined to show the key role played by the agencies in creating a favorable working environment. Nevertheless, the government’s intervention has resulted in negative impacts since it limits an entrepreneur’s freedom to carry out their business without fear of intimidation from the government. Therefore, the arguments against government intervention outweigh the ones supporting the authorities to intervene. As a result, the government should only develop a favorable working environment for entrepreneurs but should never be directly involved in differentiating business persons. Therefore, entrepreneurs would develop the best shift behaviors without direct intervention from governmental agencies.

References

Johnson, S. (2013). The Government and the Entrepreneurs. Retrieved 13 March 2020, from https://economix.blogs.nytimes.com/2013/08/22/the-government-and-the-entrepreneurs/

Entrepreneurs. (2018). The Different Types of Entrepreneurs. Retrieved 13 March 2020, from https://businesstown.com/the-different-types-of-entrepreneurs/

Dzafic, Z., & Babajic, A. (2016). The Role of the Government in Entrepreneurship Development: Evidence from Bosnia and Herzegovina. Economic Review: Journal of Economics and Business, 14(1), 68-79. Link: https://www.econstor.eu/handle/10419/193858

Pettinger, T. (2019). Pros and cons of government intervention – Economics Help. Retrieved 13 March 2020, from https://www.economicshelp.org/blog/151818/economics/pros-and-cons-of-government-intervention/

Mazzarol, T. (2014). Six ways governments can encourage entrepreneurship. Retrieved 13 March 2020, from https://www.weforum.org/agenda/2014/12/6-ways-governments-can-encourage-entrepreneurship/

Dubai, S. M. E. (2011). The role of government in supporting entrepreneurship & SME development. Dubai Department of Economic Development. Link: https://journals.sagepub.com/doi/abs/10.1177/0266242601194004

Smallbone, D., Welter, F., Voytovich, A., & Egorov, I. (2010). Government and entrepreneurship in transition economies: the case of small firms in business services in Ukraine. The service industries Journal, 30(5), 655-670. Link: https://www.tandfonline.com/doi/abs/10.1080/02642060802253876

Anzisha, P. (2017). Policies with a Purpose: Government policies that support entrepreneurship in Africa – Anzisha Prize. Retrieved 13 March 2020, from https://anzishaprize.org/effect/policies-with-a-purpose-government-policies-that-support-entrepreneurship-in-africa/

Smallbone, D., & Welter, F. (2010). Entrepreneurship and the role of government in post-socialist economies: some institutional challenges. Historical Social Research/Historische Sozialforschung, 320-333. Link: https://www.jstor.org/stable/20762462

Smallbone, D., & Welter, F. (2018). Entrepreneurship and the Role of Government in Post-Socialist Economies: the Challenge of Institutionalisation. In ICSB World Conference Proceedings (p. 1). International Council for Small Business (ICSB). Link: https://www.researchgate.net/profile/Friederike_Welter/publication/42361439_Entrepreneurship_and_the_role_of_government_in_post-socialist_economies_the_challenge_of_institutionalization/links/5504b0780cf231de07743e34/Entrepreneurship-and-the-role-of-government-in-post-socialist-economies-the-challenge-of-institutionalization.pdf

Kauffman. (2013). A Tale of Two Entrepreneurs: Understanding Differences in the Types of Entrepreneurship in the Economy. Retrieved 13 March 2020, from https://www.kauffman.org/entrepreneurship/reports/a-tale-of-two-entrepreneurs-understanding-differences-in-the-types-of-entrepreneurship-in-the-economy/

Audretsch, D. B., Grilo, I., & Thurik, A. R. (2007). Explaining entrepreneurship and the role of policy: a framework. The handbook of research on entrepreneurship policy, 1-17. Link: https://books.google.com/books?hl=en&lr=&id=nyAjjdsMHFgC&oi=fnd&pg=PA1&dq=Explaining+entrepreneurship+and+the+role+of+policy:+a+framework+David+B.+Audretsch,+Isabel+Grilo+and+A.+Roy+Thurik&ots=A6BXp9nzFA&sig=v_TGenEpuGqGFkrpWFEIVDAyVEI