Study Lecture Notes

Menu
  • Computer Science
  • Education
  • Journalism and Mass Communication
  • Management
  • Marketing
  • Political Science
  • Sociology
  • Uncategorized

Entrepreneur in Action, Functions of Entrepreneur and Definition

What is Entrepreneur

Entrepreneur as factor of production is basically taken from French and first time used by Richard Cantillon. The term Entrepreneur used for a person who willingly launch an enterprise and take the whole responsibility for the consequences and result from the business in the future.  In simple words, entrepreneur as factor of production main function is the reallocation of economic resources to higher output.

Definition of Entrepreneur as Factor of Production

Entrepreneur as factor of production is the owner of any business company or enterprise who is mainly work to earn money by taking initiative and risk.

Entrepreneur in Action

Production does not take place spontaneously but requires land, labour and capital to be employed, regulated and coordinated. This is the function of the entrepreneur or businessman.

He decides what to produce, where to produce and how to produce it, where to sell it, in what quantities and varieties, which factors to employ, and in what proportion. Decision of production must be made before the product is sold; one is, therefore, to anticipate an uncertain demand.

With expansion of corporate enterprise the conception of personal entrepreneur is now dim. Some economists do not recognize enterprise as a separate factor, saying that it is a special form of human effort. But since reward to enterprise is not a fixed wage but a residual and uncertain profit, it is convenient to treat it separately.

Functions of Entrepreneur

1.  Organization which can be performed by hired specialists for a wage, salary etc.

        i. Insurance against calculable risks;      

       ii.  Management, coordination, and decision making;

2. Functions of true entrepreneur as factor of production bearing risks of uncertainty from undertaking in regard to loss of capital as a result of market hazards.

3. Social significance of entrepreneur. They perform socially valuable services.  They cooperate to produce goods that the community desires and sometimes they commit errors in their operations but production cannot be carried out unless it is organized.

Reddit
Share
Email
Tweet
Prev Article
Next Article

Related Articles

Census Method of Data Collection

What is Census Method of Data Collection, Advantages & Disadvantages

What is Income in Economics, Definition, Formula & Examples

What is Income in Economics, Definition, Formula & Examples

ADVERTISEMENT

Related Posts

  • sovereignty.jpg
    Limitations of Sovereignty
  • Principles of Community Organization
    Principles of Community Organization
  • formal organization
    What is Formal Organization, Definition and Characteristics
  • Essay on Merits and Demerits of Communist Economic System
    Essay on Merits and Demerits of Communist …

Study Lecture Notes

All in One Solution for your Studies
Copyright © 2021 Study Lecture Notes