How Entrepreneurs Impact an Economy

Introduction As economies concern to integrate collect to globalisation and formally closed economies like India and China march toward total liberalisation, entrepreneurship is on the increase. A close analysis of developed and industrialised economies indicates a common denominator that stands unwrap amongst all of them, which is the important role played by entrepreneurship and entrepreneurs in much(prenominal) economies.This phenomenon has proved to us that if an parsimony is to develop fully, entrepreneurship should be allowed to flourish. hence it is the documentary of this paper to critically analyse the usurpation of entrepreneurs in any given up rescue. In this paper the writer will identify and discuss the umteen benefits afforded to an miserliness through and through entrepreneurs and entrepreneurship and the disadvantages of the same and leader conclusions on the overall invasion of the entrepreneurs. InnovationIndividuals oftentimes resort to entrepreneurs hip for one of the following reasons, because they find a foodstuff place niche and sacrifice the solution to profit from such niche, because they have been unavailing to find suit competent traffic or a suitable agency of income and therefore have resorted to using their creativity to hand over an income for themselves, or because they have the technological know-how and the financial resources (or able to source all of the above) necessary to generate income by satisfying a need in the marketplace.Irrespective of which of the above light-emitting diode an individual to conk an entrepreneur it is clear that innovation and creativity is the private road factor and therefore it layabout be stated that the biggest continue of entrepreneurs to an prudence is the innovative contribution that they make. Job Creation As stated in the previous section one of the main reasons that individuals tend to become entrepreneurs is because they argon unable to find suitable jobs.As a a llow for, by being enterprising, germinal and finding a market niche, non totally argon they able to generate an income for themselves but excessively to employ other individuals in their communication channel operations. Therefore one of the most compulsive impacts that entrepreneurs make on an sparing is job creation and the reduction of un troth levels within that economy. In developed countries we command that almost 40 50% of the workforce are employed in piffling and medium scale descent enterprises that were started up by precise enterprising individuals.Likewise in countries like India we see that millions of women have been able to commit their families out of poverty through self employment and entrepreneurship that has been made affirmable by different Non Governmental Organisations and due to the availability of such resources through micro finance etc. Africa is another good example of small scale entrepreneurs helping to reduce poverty and help many vitia te destitution. Therefore based on everything that has been stated above it is apparent that entrepreneurs tin pot cause a great degree of impact on an economy through job creation and income generation. change magnitude Competition Another positive impact of entrepreneurship on an economy is the change magnitude level of competition in that economy as new entrepreneurs join the fray in existing home(prenominal) markets. While one may venture to say that this will only lead to market saturation, the upside of such a phenomenon is that it causes all the players in the market to re-evaluate their operational capabilities, increase value addition, lower costs and become much efficient.Thus it evict be stated that competition reduces likelihood of monopolies and oligopolies in the marketplace and is beneficial to the customer and the economy as a whole. Increased Productivity One of the advantages of increased competition in an economy is that individuals and firms continue to sou rce methods that tummy better improve their operations, use resources to a greater extent expeditiously and most importantly reduce costs while adding value. All this often results in an increase in productivity in an economy and a increase in the gross domesticated product (GDP), which is indeed a benefit for the economy.While opponents tend to state that when productivity increases the unemployment can often increase, thence reducing the positive impacts, it is the opinion of the writer that increased productivity which can then lead to increased unemployment will then cause more individuals to be creative, find niche markets, become entrepreneurs and begin generating more employment opportunities, thus re-inventing the wheel and driving the economy forward.New Markets As stated in the previous section increased competition in the marketplace can cause saturation and as a result many entrepreneurs perchance driven to seek new markets for their products and services or adapt ma rket penetration tactics.Either way such a phenomena of increased competition, which ultimately causes individuals to come across for new markets can be considered as a positive impact on the economy and therefore entrepreneurs can be considered to play a very important role in the economy. As integration of economies continues due to globalisation entrepreneurs often tend to look for markets that are outside of their domestic sphere thus generating foreign revenue and increasing the prosperity of the economy as a whole.While this maybe a very simplistic bill of the impact that entrepreneurs make on an economy, it is also safe to say that the employment generation, increased competition, market expansion, market penetration and sourcing new markets all result in income generation that ultimately help an economy to become more prosperous, draw millions out of poverty and generate funds for cordial eudaimonia activities that ultimately uplift the bread and butter standards of its citizenry.Negative Impacts of Entrepreneurs The single largest minus impact of entrepreneurs on an economy is the plundering of resources, which can have a disastrous act on the surroundings. While such negative impacts are mitigated to whatever extent in developed economies due to the enforcement of environmental protection standards and regulations, this is not the case in developing economies.Further entrepreneurship requires a certain degree of business knowledge and know how, without which entrepreneurial ventures can often fail, which can also cause many financial hardship that in extreme cases can even lead to destitution. Social Entrepreneurship Today we see the realm of social entrepreneurship growing exponentially which is a very positive sign and has helped to draw millions out of poverty, decrease unemployment, decrease the number of people dependent on social welfare and all in all uplift the living standards and quality of life of millions.Further social entrepren eurship initiatives are also often seen as green initiatives that take into consideration the impact on the natural environment and therefore strives to keep this at a minimum, thus increasing consciousness about such issues, avoiding plundering of natural resources and conserving the environment wherever possible. Therefore it can be stated that the negative impacts of entrepreneurs on an economy can be mitigated to some extent through social entrepreneurship. ConclusionBased on everything that has been discussed above it is apparent that the positive impacts of entrepreneurs on an economy, far outweigh the negative impacts. Job creation, reduction in unemployment levels, increased competition, opening new markets, increasing productivity, foreign income generation and poverty alleviation are some of the positive impacts that entrepreneurs have on an economy. However this is not to say that there are no negative impacts such as the wastage and plundering of resources, yet taken a s a whole it is apparent that the entrepreneurs positively impact an economy.