ECON 1 Lecture Notes - Lecture 19: Berlin Wall, Joseph Schumpeter, Creative Destruction
Document Summary
Development: entrepreneurship is in many ways a local or regional phenomenon, entrepreneurs shaped by geographic boundaries and context within which they operate. Entrepreneurship and economic development: economic growth whenever people take resources and rearrange them in ways that are valuable, entrepreneurship crucial element in fostering economic development and growth, stimulates competition, drives innovation, creates employment, generates positive externalities. Informal contact potential for coordination of individuals. In order to foster entrepreneurship harness competition. Intrinsic link between entrepreneurship and competition: environment allowing free entry into the market entrepreneurs take advantage of new profit opportunities, create entrepreneurial possibilities others can act upon, making more entrepreneurship possible. Interaction: quality of place generates buzz, attracts creative people stimulates the economy (e. g. ideas) Innovative activity tends to cluster geographically more in knowledge intensive industries where knowledge spillovers play a decisive role: also take place internationally through more selective routes, unless local networks keep abreast of different technological options emerging outside.
