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A Comparative Discussion of Different Approaches to Entrepreneurship.

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Introduction

A Comparative Discussion of Different Approaches to Entrepreneurship 19/12/2003 1.0 Introduction: There is no a universal theory exists in entrepreneurship by now. The entrepreneurship consists of several different approaches including psychological, sociological, anthropological, economic and regional science areas. Each school has its own opinion, so does every scholar. For example, Robert Hisrich mentioned (1985) entrepreneurship is the process of creating something differently with value by devoting the necessary time and effort, assuming the accompanying financial, psychological and social risks, and receiving the resulting rewards of monetary and personal satisfaction. Stephen Spinelli, et al. in Babson College recently also presented a definition as a way of thinking, reasoning, and acting that is opportunity obsessed, holistic in approach, and leadership balanced. The analysis of concept of entrepreneurship and its meaning is such a large topic to cover in a single paper. Thus, dipping into an inch of research, this study concentrates only on economic, psychological and sociological approaches and displays several previous significant opinions. At the end of discussion, the researcher brings out its hypothetical conclusion of comprehensive consideration. 2.0 Methodology: This is a literature study. The paper is divided into three main sections in terms of economic, psychological and sociological approaches. The author set about consulting the lecture handouts from the course to create a list of points to consider, after which a selection of books from the library were chosen for further study, report outline being upgraded and enlarged when suitable new points were found. At the same time, a search on the Internet using keywords such as 'economic entrepreneurship', 'psychological entrepreneurship' and 'sociological entrepreneurship' was carried out, resulting in thousands of pertinent responses being displayed. In making a critical selection, about 100 articles organized as an electronic-formatted literature, including journals, periodicals, and works citations which were found to be of interest to this research. After reviewing and filtering, the researcher has recapitulated the main points as stated in the main body. ...read more.

Middle

Additionally, psychological approach to entrepreneurship provides personal traits of entrepreneur. One of the foremasts is David Deakins. He concluded such 'great person' (Wickham, 2001), 'social misfit', 'flamboyant extrovert' as an entrepreneurial person's genetic complements. He defined characteristics of the successful entrepreneur as resilience, attuned to opportunity, assertiveness, receptiveness to new ideas and comfort with power. 4.2 A critical analysis of psychological approach: Psychological entrepreneurship builds on the presumption that an entrepreneur has a particular personality compared with non-entrepreneur (Philipsen, 1998). However, different problems have been identified with this approach. The concepts and definitions of personal traits differ substantially as well as the characteristics correlated with entrepreneurship (Gartner, 1989). The characteristics correlated with entrepreneurship found in studies are conflicting (Stevenson, et al., 1985) and many both successful and unsuccessful entrepreneurs have characteristics which are not in the list, which are regarded as no universal trait (Stevenson and Sahlman, 1987). There is no single style of a successful entrepreneurial characteristic can be identified in contingent circumstances. Person has different characteristics can be successful as long as an available method to process it. What's more, an imagination of psychological entrepreneurship is difficult to find an empirical support in current study. Another deficiency of psychological approach is a failure in accounting for economic surrounding influences in the generation of entrepreneurship. As Reynolds (1991) stated that psychological theory predicts entrepreneurship resulted from the ignorance of social context and choices confronting the individual when decision is made. And 'Personal attitudes towards entrepreneurship are a 'product' of the current cultural environment... and are reinforced by education and legislation that again are products of the cultural system' (Verheul et al.). But psychological approach focuses more innate and internal traits rather than those can be acquired and social-formed. In summary, psychological approach to entrepreneurship lacks of integrated and systematic macro-environmental analysis as well as character generalisation in different circumstances. 5.0 Sociological approach to entrepreneurship 5.1 Literature review: Sociological approach describes entrepreneurship as a part of the overall structure of value and status hierarchy (Jaaskelainen, 2003). ...read more.

Conclusion

7.0 Reference: [1] Knight, F. H, 1921, Risk, Uncertainty and Profit, New York, Houghton Mifflin [2] Kelly, G. Shaver, Linda R. Scott, Person, Process, Choices: The Psychology of New Venture Creation, http://www.wm.edu/PSYC/kgspapers/SS91.pdf [2] Mikko Jaaskelainen, 2003, Entrepreneurship and Economic Growth, http://www.tuta.hut.fi/studies/Courses_and_schedules/Isib/TU-91.167/Old_seminar_papers/jaaskelainen_mikko.pdf [3] G. T. Lumpkin, If Not Entrepreneurship, Can Psychological Characteristics Predict Entrepreneurial Orientation?-A Pilot Study, http://www.usasbe.org/knowledge/proceedings/1999/lumpkin.pdf [4] David A.Harper, Foundations of entrepreneurship and economic development, New York: Routledge, 2003, http://www.cato.org/pubs/journal/cj23n2/cj23n2-14.pdf [5] Jahangir Alam and Mohammad Akter Hossan, Linking Between Franchising Networks for Entrepreneurship and Economical Development-Looking for A New Model, Paper to be presented at the EMNET-Conference on 'Economics and Management of Franchising Networks', Vienna, Austria, June 2003 http://www.univie.ac.at/EMNET/download/AlamHossanpaper.doc [6] Thomas Grebel, Andreas Pyka, Horst Hanusch, An Evolutionary Approach to the Theory of Entrepreneurship, 2001 http://www.wiwi.uni-jena.de/Mikro/pdf/Vortrag-Grebel-131201.pdf [7] David Deakins, the Small Firms and the UK Economy, 1999, P. 34 [8] M. Frese and A. Rauch, Entrepreneurship, Psychology of, http://innovation.im-boot.org/modules.php?name=Content&pa=showpage&pid=63 [9] Socially Acquired Needs, McClelland, David C. 1961, The Achieving Society, New York: Van Nostrand Reinhold http://www.cba.uri.edu/Scholl/Notes/Sources_Motivation.htm#McClelland [10] Janis, Irving L. & Mann, Leon. 1977, Decision Making: A Psychological Analysis of Conflict, Choice, and Commitment, New York, the Free Press [11] Richard W. Scholl, Motivation Inducement Model, Source: Leonard, N.H et al, A Self concept-based Model of Work Motivation, Proceedings of the Academy of Management Annual Meeting, Vancouver, B.C. http://www.cba.uri.edu/Scholl/Notes/Sources_Inducement_Matrix.htm [12] Philip A. Wickham, Strategic Entrepreneurship: A Decision-Making Approach to New Venture Creation and Management, 2001: 'A 'great person' is destined by virtue of his or her 'nature' to rise above the crowd. Such people are born to be great and will achieve greatness, one way or another.' [13] Kristian Philipsen, Entrepreneurship as Organizing-A Literature Study of Entrepreneurship, Paper to be presented at the DRUID Summer Conference, Denmark, http://www.druid.dk/conferences/summer1998/conf-papers/philipsen.pdf [14] Markku Virtanen, The Role of Different Theories in Explaining Entrepreneurship, http://www.usasbe.org/knowledge/proceedings/1997/P109Virtanen.PDF [15] Karl Vesper, New Venture Strategies, P. 2 [16] Lester C. Thurow, Foreword, http://www.mansfieldfdn.org/programs/program_pdfs/ent_thurow.pdf [17] Mark Casson, Entrepreneurship, http://www.econlib.org/library/Enc/Entrepreneurship.html [18] Robert D. Hisrich, Michael P. Peters, Entrepreneurship, 4th edition, 1998 1 This opinion comes from his website http://www.libertyhaven.com/thinkers/israelmkirzner/ ?? ?? ?? ?? 1 ...read more.

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