Richard Cantillon Richard Cantillon (1680?-1734) was the earliest scholar of whom we know that paid considerable attention to the entrepreneur. He introduced the very concept of entrepreneur. The entrepreneur is functionally described as arbitrager. The motivating factor is the potential
profit generated from the activity of "buying at a certain price and selling at an uncertain price".
Jean-Baptiste Say Jean-Baptiste Say, who has been an entrepreneur during a period of his life, recognizes the "superior kind of
labour" of the entrepreneur. He is the "coordinator, modern leader and manager within his firm".
Frank Knight Frank Knight saw the entrepreneur as someone who undertakes business decisions under conditions of 'uncertainty'.
Knightian uncertainty exists where there is no basis for objective probabilities, so that it is unmeasureable and decisions have to be made using subjective judgment. The entrepreneur earns economic profits as a reward for good judgment. Entrepreneurs are seen as being confident and venturesome.
Schumpeter Schumpeter's concept is a synthesis of three different notions of the entrepreneur: risk bearer, innovator and a coordinator. He assigned the role of innovator to the entrepreneur, driving economic growth through a process of
creative destruction, and not to the
capitalist. Capitalists supply capital while entrepreneurs innovate. He stated that "whatever the type, everyone is an entrepreneur only when he actually carries out a new combination and loses that character as soon as he has built up his business, when he settles to running it as other people run their business." The focus here is not on a category of person, but on a function. He was perhaps influenced by his family history. The Schumpeterian entrepreneur disrupts existing
equilibrium.
Innovation is a chaotic, unpredictable economic process, which cannot be modeled using the equilibrium based analytic methods used in mainstream economic theory.
Israel Kirzner Israel Kirzner, an economist of the
Austrian School, sees the entrepreneur as a discoverer and arbitrageur who is alert to opportunities for profit that exist due to market disequilibrium. In contrast to Schumpeter, for Kirzner, entrepreneurs are the "equilibrating force," making ongoing adjustments that contribute to a convergence on equilibrium via the market process.
Harvey Leibenstein Harvey Leibenstein claimed that entrepreneurship is a creative response to
x-inefficiency. Entrepreneurs are also gap-fillers, having the ability to perceive market opportunities and to develop new goods/services that are not currently being supplied. He postulates that entrepreneurs have the special ability to connect markets and make up for market deficiencies. Additionally, drawing from the theories of
J.B. Say and
Richard Cantillon, Leibenstein suggests that entrepreneurs have the ability to combine various inputs into new innovations in order to satisfy unfulfilled market demand.
Baumol Baumol has argued that entrepreneurship can be either productive or unproductive. Unproductive entrepreneurs may pursue
economic rents or crime. Societies differ significantly in how they allocate entrepreneurial activities between the two forms of entrepreneurship, depending on the 'rules of the game' such as the laws in each society.
David Audretsch Audretsch defines the entrepreneur as the missing link between investment in knowledge and growth. It is the entrepreneur who adds value to
scientific discovery. Entrepreneurship capital is then, just as capital and labor in a
macroeconomic model, an essential factor of production in the economy. == See also ==