Who is an Entrepreneur?
Oxford English Dictionary defines an entrepreneur as ‘one who undertakes an enterprise, especially a contractor acting as an intermediary between capital and labor.’ The undertaking of an enterprise involves combining capital and labor for the purpose of production. Anyone who undertakes this task is an entrepreneur.
Thus the entrepreneur can be defined as an innovator, a risk taker, a resource assembler, an organization builder and so on. An entrepreneur introduces new ideas, carries on new activities, coordinates the factors of production, and decides how the business shall run. He anticipates the future trend of demand and price. He has vision, originality of thoughts, and the ability to take calculated risks.
Definition of Entrepreneur
These are the definitions of entrepreneur to understand by different authors:
An Entrepreneur is an agent who unites all means of production and who establishes the value of the products. Pre-establish the entire capital, the employees, and the values of the wages, the interest and the rent which he pays, as well as the profits to himself. He may or may not supply capital, but he must have judgment and preservence and knowledge of the world of business. He must possess the art of supervision and administration.J.B. Say
According to Say, three factors form the crux of entrepreneurship:
- Moral qualities for the work consist of judgment, preservation, and knowledge of the business environment.
- Command on sufficient capital resources.
- And effective superintendence and administration to overcome the uncertainty of profits.
Entrepreneur basically is an innovator who carries out new combinations to initiate and accelerate the process of economic development.Schumpeter
Innovations may assume the following forms:
- Introduction of new goods.
- Introduction of new methods of production.
- Opening of a new market.
- Conquest of raw sources of raw material or half manufactured goods.
- Carrying of new organization of any industry.
Entrepreneurial Growth in India
A proper understanding of the entrepreneurial history of any country must evolve itself within the context of the economic history of that particular country. The review of entrepreneurial growth in India has, therefore, been divided into three sections, viz., entrepreneurial growth before 1850, from 1850 till independence, and post-independence.
- Entrepreneurial Growth Before 1850
- Entrepreneurial Growth after 1850
- Entrepreneurial Growth During Post-Independence Era
- Industrial Policy, 1948
Entrepreneurial Growth Before 1850
People were organized in a unit which was the agricultural village, termed a village community. The village life was in no way dominated by the towns. The village community consisted of farmers, artisans, Brahmins, weavers, carpenters, goldsmiths etc.
Manufacturing entrepreneurship did not develop in India till 1850 due to weak communication and transportation systems. The urban industries were well organized and were flourishing by the end of the 19th century. Towns were trading as commercial centers and the life there was much different from the villages.
There existed a large variety of occupations and trades in towns which entered wider markets. Although entrepreneurial talent was in abundance in Indian businessmen India did not offer much scope for its development. Why entrepreneurship did not grow early in India can be explained by multiple factors:
- Lack of capital, raw material, sales and financing,
- Lack of political unity,
- Network of custom barriers,
- The existence of innumerable systems of currency,
- Regional markets plagued by arbitrary political authority,
- Taxation policies, and
- Low prestige of businessman,
Entrepreneurial Growth after 1850
Manufacturing entrepreneurship emerged as the latent consequence of East India Company’s advent in India. In 1858, there were four cotton textile mills in India, and within a period of 25 years, its number had increased to 58. The East India Company established its first ship-building industry in Surat.
By the last quarter of the 19th century, there were 51 cotton mills and 18 Jute mills. The Britishers have developed India in many ways but it is not correct to argue that they showed a spirit of adventure.
These efforts were undertaken by them only when they felt attracted by the high profits available in the areas But their contribution to development can’t be ignored. Not only that, the entire policy of protection was aimed at protecting the British industrial and commercial interests. So, they were bothered about their own benefit only.
Entrepreneurial Growth During Post-Independence Era
Entrepreneurial growth during the post-independence era truly means the industrial development, innovational efforts on the part of individuals or corporations relating to a product, organization of the market, rise in the mobility of certain castes or communities in relation to business activities, or entry of venturesome capital in an altogether new line.
It may also be construed as a slow or creeping change in the traditional structure of agriculture. The link between infrastructure and development is not a once-and-for-all affair. It is a continuous process, and progress in development has to be preceded, accompanied, and followed by progress in infrastructure. It is necessary to keep all the above-mentioned areas in mind while studying entrepreneurial growth during post- post-independence period.
Industrial Policy, 1948
The attainment of independence of India on August 15, 1947, made a tremendous difference to the industrial landscape. Indigenous entrepreneurship was no longer required to function as the camp followers of foreign interests. Production in India had declined and the population was increasing.
Inflation was showing its giggling teeth. In view of the need to step up production and combat inflationary tendencies, to ensure economic security which is vital for industrial growth, and to produce a stimulating climate for investment in industry.
Industrial Policy 1948 was announced to maintain a proper distribution of economic power between the private and public sectors and to encourage the tempo of industrialization by spreading entrepreneurship from the existing centers to other cities, towns, and villages.