Role of Entrepreneurship in Economic Development

Entrepreneurs play a crucial role in the process of economic development. The entrepreneurship has been regarded as one of the most important inputs in the economic development of a country. The quantum of entrepreneurial competence in a country by and large influences the rate of growth of an economy. Thus the lack of entrepreneurial ability is the basic cause of backwardness or poor growth of an economy.

Entrepreneurship can be defined as an ability to discover, create or invent opportunities and exploit them to the benefit of the society, which in turn, brings prosperity to the innovator and his organization. In a developing economy, the process of development is highly dependent on human activities. The well co-ordinated and well planned human activities can bring about socio economic development at a faster rate. It plays a very important role in activating the factors of production leading to an overall economic development.

The availability of entrepreneurs is the pre-condition for economic growth. Economic development of any region is an outcome of purposeful entrepreneurial activity. Entrepreneur assumes various roles in development process, as an organizer of human capital, natural material resources, worker and consumers, the stands of the centre of the whole process of economic development. Economic growth depends on the role of applied technical ideas and puts them into effect in the process of economic development.

Thus entrepreneur becomes the agent of change of society. Productivity is the key to development of every country’s economy. However the major prime mover of productivity is entrepreneurship. A country is bond to make rapid progress, where the right types of entrepreneurs are available in adequate number for starting small unit in local area. The economic history of the presently developed countries trends to support the fact that the economy is an effect for which entrepreneurship is the cause.

Start Quiz