Today large companies are downsizing and reengineering with much more frequency, and it would appear that the trend has become one of people starting their own business. An interesting statistic stated that in the United States a new small business is started every 11 seconds; (of course many do fail, but they are started all the same). (Sullivan) We must also keep in mind that starting a business and being self-employed are not always one in the same-as this paper will examine in more detail. People can be, and often are, simultaneously owners, self-employed producers, and capitalists.
It was stated that,
In traditional economics a basic principle is that
economic resources-the means of producing goods
and services-are limited or scarce. Economic resources
are defined as property resources-land or raw materials and
capital-and human resources-labor and entrepreneurial
ability. Therefore, entrepreneurial ability is one of the four
cornerstones of our economy. (Kautz, "Entrepreneurial Issues.")
The availability of all of these resources in turn, determines the vitality of the economy and its growth.
Although to be an entrepreneur does not require that one be self-employed, being self-employed does require that one, at least to some extent, be an entrepreneur. Therefore it is important to understand what it "is" to be an entrepreneur as well as what it "takes" to be an entrepreneur. The basic components of entrepreneurial ability can be reduced to four basic components. First, the entrepreneur is the one who takes the first step, and thus the initiative, to combine the individual parts of land, capital, and labor to produce a good or service in what they hope to be a profitable venture. Second, they are the ones who make the business policy decisions that set the direction of the business. Third, an entrepreneur is an "innovator." That is to say that they are an individual who attempts to introduce new products, new productive techniques, and or perhaps new forms of business organization to the economy. The fourth component to being an entrepreneur is that they tend to be a risk taker in terms of time, effort, and reputation. They are also risk takers in dealing with their own invested funds and the funds of their associates and other stockholders. (Kautz, "Entrepreneurial Issues.")
The ideas contained within entrepreneurship are not new. Entrepreneurs have actually existed throughout history, but the arrival of the 20th Century has brought with it a new vitality to the economy, and there has been an increased flourishing of the field of entrepreneurship. Our world is continually and constantly changing which in and of itself creates new opportunities for firms. The service sector of the economy is always increasing and changing as well. Plus, the very fact that the public views small businesses in a "positive light" and believes...