Anna Nadgrodkiewicz writing in CIPE:
Entrepreneurship provides the creative force of economic development. Entrepreneurs lead economic change by creating new goods and services,new firms, and innovative solutions to local – and global – needs. At the same time, entrepreneurship plays a vital role in the development of democracy. It expands opportunity, unleashes individual initiative, and cultivates independent citizens who have a stake in society and democratic governance.More here
Image by Daniel Isenberg at Babson College
Entrepreneurship is a grassroots global phenomenon that stems from individual ingenuity,courage, and often – as is the case with millions of informal entrepreneurs – the basic need for survival. Helping citizens move from necessity to opportunity entrepreneurship is the responsibility of governments because they put in place institutional frameworks that either help or hinder entrepreneurship. For entrepreneurial ventures to take root and grow, the right environment must be in place. Startups require low barriers at the outset; to achieve scale they require a legal and regulatory framework that rewards entrepreneurial initiative, ensures fair competition, and protects private property rights.
Entrepreneurs embody Friedrich Hayek’s idea that harnessing dispersed local knowledge by individuals is crucial to both economic and political freedom and citizen-led innovation.While government also has a key role to play, too many entrepreneurship promotion efforts resemble failed top-down planning limited to investments in particular industries, clusters, or incubators. In a sustainable entrepreneurial ecosystem, financial,educational and other supports must be backed by a favorable policy environment. Governments should therefore focus on building the legal and institutional basis for supporting bottom-up efforts of entrepreneurs, making sure that laws and regulations are implemented in practice, and enforcing the rules fairly.
All too often much of the emphasis is placed on startups, especially in technology, in search for the next big thing – the next Facebook, the next Google. Governments should also stop trying to blindly emulate the Silicon Valley or countries considered the champions of entrepreneurship. They instead need to look to their own countries’ competitive advantage and make the operating environment easier for entrepreneurs in areas such as fisheries or agribusiness,not just IT or other knowledge-driven sectors.
