ECON 2720 Final: review-sheet-1

• School: University of Guelph
• Department: Economics
• Course: ECON 2720
• Professor: B Ferguson

Document Summary

Review sheet 1 (1) explain william baumol"s concepts of productive and unproductive. Productive entrepreneurship: a company makes profit by producing things that people want to buy, and selling them at a price they are willing to pay. Meaning a firm must incur risk to produce a profit. Unproductive entrepreneurship: all about persuasion of the government. A company is trying to make a profit by persuading the government to reduce the risk that they face. This could be by getting the government to give you a monopoly, and also give protection of that market (ex. This preserves the players dominant position within the market not by keeping ahead of competitors, by convincing the gov"t to keep potential competitors out of the market. (2) explain what joseph schumpeter meant by creative destruction. What do we mean by the neoclassical stage of the. Discuss the allocation of economic welfare over time under the schumpeterian process.