ENTREPRENEURSHIP

In French, to be an entrepreneur is to be "one who undertakes a task or project." Thus, entrepreneurship has come to be defined as the act of risking capital and resources to identify and implement a solution to a problem with the goal of turning a profit. The eighteenth-century Irishman Richard Cantillon first used term entrepreneur in a business context to describe businessmen who bought goods and services only in order to resell them later at a higher price. This idea of risking one's fortune for the possibility of a large but uncertain future gain is still the central meaning of entrepreneurship.

In 1904 the German sociologist Max Weber (1864–1920) described the entrepreneur as a heroic, energetic figure whose "Protestant work ethic" relied on thrift and hard work to make possible economic innovation and growth. The leading economist of entrepreneurship, Austrian Joseph Schumpeter (1883–1950), argued that in every capitalist society great risk-taking entrepreneurs arise who have the vision and energy to create new technologies and industries. But when lesser imitators attempt to recreate the success of these entrepreneurs, the economy becomes glutted with over-investment and eventually collapses into recession. Eventually a new generation of entrepreneurs arises to fuel a new boom in innovation.

The strong tradition of property rights in the United States created an ideal environment for the first great period of U.S. entrepreneurship. Between 1789 to 1932 U.S. entrepreneurship enjoyed its "classical" age. During this time business risk-taking and economic growth occurred largely through the efforts of individual men such as Andrew Carnegie (1835–1919), John D. Rockefeller (1839–1937), Thomas Edison (1847–1931), and Henry Ford (1863–1947). These entrepreneurs and many like them accumulated the capital, identified the opportunities, organized the resources, and crushed their competition to build vast corporate empires. Since 1933 the federal government has played a much larger role in ensuring that pure entrepreneurship doesn't harm the public interest.

To some people, the rise of Bill Gates (1955—) and the Microsoft Corporation in the 1980s represented the birth of a new age of corporate-style entrepreneurship. Some U.S. economists attributed the explosion in new Internet and technology companies in the 1990s both to the emergence of a new class of managers and risk-takers trained to pursue innovation and to economic conditions that created a large pool of investment capital for these entrepreneurs to draw on. But at the close of the twentieth century entrepreneurship means everything from starting a small home-based business to developing and marketing a new product or technology to establishing an entire corporation or industry

See also: Capital, Capitalism, Microsoft, Joseph Schumpeter, Work Ethic