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Economic Contribution of Entrepreuneurs

Entrepreneurs play a key role in economic development by creating wealth and jobs. They mobilize capital from investors and the public to start businesses, which leads to wealth creation and distribution as the businesses grow successfully. This job creation and pooling of capital are basic goals of economic development. Entrepreneurs also help develop regions by locating businesses in less developed areas, bringing infrastructure and services. While growing businesses and adding more firms increases GDP, per capita income, and standards of living, entrepreneurs may accumulate too much wealth and influence, potentially increasing crime and job market instability.

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Shivanand Bhandarkar
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47 views

Economic Contribution of Entrepreuneurs

Entrepreneurs play a key role in economic development by creating wealth and jobs. They mobilize capital from investors and the public to start businesses, which leads to wealth creation and distribution as the businesses grow successfully. This job creation and pooling of capital are basic goals of economic development. Entrepreneurs also help develop regions by locating businesses in less developed areas, bringing infrastructure and services. While growing businesses and adding more firms increases GDP, per capita income, and standards of living, entrepreneurs may accumulate too much wealth and influence, potentially increasing crime and job market instability.

Uploaded by

Shivanand Bhandarkar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Wealth creation/Distribution of wealth

By establishing the business entity, entrepreneurs


invest their own resources and attract capital (in
the form of debt, equity, etc.) from investors,
lenders and the public. This mobilizes public
wealth and allows people to benefit from the
success of entrepreneurs and growing businesses.
This kind of pooled capital that results in wealth
creation and distribution is one of the basic
imperatives and goals of economic development.
Job creators
Entrepreneurs are by nature and definition job creators, as
opposed to job seekers. The simple translation is that when you
become an entrepreneur, there is one less job seeker in the
economy, and then you provide employment for multiple other
job seekers. This kind of job creation by new and existing
businesses is again is one of the basic goals of economic
development. This is why the Govt. of India has launched
initiatives such as StartupIndia to promote and support new
startups, and also others like the Make in India initiative to
attract foreign companies and their FDI into the Indian
economy. All this in turn creates a lot of job opportunities, and
is helping in augmenting our standards to a global level.
Balanced Regional Development
Entrepreneurs setting up new businesses and
industrial units help with regional development
by locating in less developed and backward
areas. The growth of industries and business in
these areas leads to infrastructure improvements
like better roads and rail links, airports, stable
electricity and water supply, schools, hospitals,
shopping malls and other public and private
services that would not otherwise be available.
GDP/PER CAPITA INCOME
Indias MSME sector, comprised of 36 million units
that provide employment for more than 80 million
people, now accounts for over 37% of the countrys
GDP. Each new addition to these 36 million units
makes use of even more resources like land, labor
and capital to develop products and services that
add to the national income, national product and
per capita income of the country. This growth in
GDP and per capita income is again one of the
essential goals of economic development.
STANDARD OF LIVING
Increase in the standard of living of people in a community
is yet another key goal of economic development.
Entrepreneurs again play a key role in increasing the
standard of living in a community. They do this not just by
creating jobs, but also by developing and adopting
innovations that lead to improvements in the quality of life
of their employees, customers, and other stakeholders in
the community. For example, automation that reduces
production costs and enables faster production will make a
business unit more productive, while also providing its
customers with the same goods at lower prices.
EXPORTS/ FOREIGN EXCHANGE
Any growing business will eventually want to get
started with exports to expand their business to
foreign markets. This is an important ingredient of
economic development since it provides access to
bigger markets, and leads to currency inflows and
access to the latest cutting-edge technologies and
processes being used in more developed foreign
markets. Another key benefit is that this expansion
that leads to more stable business revenue during
economic downturns in the local economy.
COMMUNITY DEVELOPMENT
Economic development doesnt always translate
into community development. Community
development requires infrastructure for education
and training, healthcare, and other public services.
For example, you need highly educated and skilled
workers in a community to attract new businesses.
If there are educational institutions, technical
training schools and internship opportunities, that
will help build the pool of educated and skilled
workers.
REVENUE FOR THE STATE/NATION
TAX REVENUE
DIRECT TAXES
INDIRECT TAXES
DISADVANTAGES OF ENTREPRENEURSHIP TO THE ECONOMY

ACCUMULATION OF WEALTH IN THE HANDS


OF FEW
INFLUENTIAL DISADVANTAGES
MATERIALISM
INCREASED CRIME RATES IN THE SOCIETY
INSTABILITY IN THE JOB MARKET

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