Role of Entrepreneurship in Economic Development


     According to Michael Schaper, entrepreneurship is the center of functions of market economies. Entrepreneurs are the lifeblood of the market, and thus they greatly affect the economy. The relationship between business and economy is very directly proportional. As one increases, the other also increases. Thus, if one of them failed, then definitely the other one will also fail.
     The growth and development of an economy lies on the hands of entrepreneurs. They can solve the problems that the economy faces by the use of their innovative ideas and risky but effective decisions. By doing this, they do not just solve the problem of the economy. Instead, they open more doors of opportunities and they expand the scope of economic activities. Schaper stated that the best example of importance of entrepreneurship in the economy was illustrated the best by the South East Asia. Many countries in this region such as Singapore, Malaysia, South Korea and Thailand transformed because of the entrepreneurial activities that boosted their economies. 
     To sum up, below is the list of major roles of entrepreneurship in the economic development of a country.
1. Employment Generation. Establishing new businesses opens several opportunities of employment because businesses, especially those that are large, do not operate with only one person. Entrepreneurship opens million of jobs and when many people were employed, the crisis on unemployment and poverty will be solved. Thus, the economy will rise.
2. National Income. If there are many established businesses in one country, the national income is very large. It will help the citizens and the government. Excessive income may lead to not paying the taxes anymore. It will also increase the standard of living in that particular country. They also have the chance to import and export goods to the other country. 
3. Dispersal of economic power. Having few entrepreneurs in a country may lead to monopoly and unbalanced economic power. If there are many entrepreneurs and businesses, the economic power is dispersed evenly and the domination of other business will be avoided.
4. Balanced Regional Development. The growth of industry in one place leads to public benefits in transportation, education, facilities, health, etc. If only one city has a progressive industry, these benefits were only concentrated to them. Therefore, if entrepreneurs and business were scattered around the country, they will make the industry grow in the other regions and it will create balanced development.
    It is very clear that entrepreneurship plays a vital role in the progress of economy. They were related to each other. Renjith said that “The Role played by the entrepreneurship development can be expressed in the following words : Economic development is the effect for which entrepreneurship is a cause.”


References:

· Renjith, R.P. (2009). Role of entrepreneurship in economic development. Retrieved from http://www.indiastudychannel.com/resources/93451-Role-entrepreneurship-economic-development. aspx
· Schaper, M. (2007). Entrepreneurship and small business (2nd Pacific rim ed). Australia: John Wiley & Sons. 
· Sinha, DK. (2014). Role of entrepreneurship in economic development. Retrieved formhttp://www.yourarticlelibrary.com/essay/role-of-entrepreneurship-in-economic-development/40658

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