An insight into the background of entrepreneurship and the impact it can have on economies worldwide, particularly in light of the global economic crisis and the transition in the Middle East and North Africa.
Scholars have incessantly been embroiled in a continuous debate over a scientific definition of entrepreneurship. With its myriad definitions, it is simpler to concentrate on the characteristics and functions of an entrepreneur in order to understand the field.
The paradigm of entrepreneurship has its roots established within the work of Joseph Schumpeter who was one of the first scholars to contribute towards the field of entrepreneurship. Based on Schumpeter’s work, an entrepreneur is responsible for spotting gaps in the market, carrying out innovations, taking the risks necessary to establish the production and marketing of the associated products or services, and expecting the venture to grow. In other words, entrepreneurs look for changes within.
This immediately places a great emphasis on the importance of entrepreneurship for the growth of economies, particularly in the current global economic situation. Entrepreneurship is the engine of the society, not just of the economy. Research indicates a positive relationship between entrepreneurship and aggregate economic growth. Therefore, entrepreneurs have recently been paid rather more attention.
Why is Global Entrepreneurship Relevant?
Governments worldwide are now determined more than ever for universities to promote entrepreneurial skills amongst graduates and to strengthen the relationship between universities and business enterprises. This is followed with the intention to utilise the well-educated and motivated pool of young people in higher education institutes in order to improve innovation and technology within constantly changing societies. For example, the University College London’s (UCL) Department of Management Science, organises a series of guest lectures from leading entrepreneurs and investors to teach students the entrepreneurial flare.
Yet, the gap between the transitions from a business idea to the establishment of an enterprise remains wide. Indeed, only 5% of entrepreneurs are successful.
So why is there such a high rate of failure amongst entrepreneurs?
With such high failure rate amongst entrepreneurs, it is important to encourage entrepreneurial skills on a global scale. It is even more important to provide support through workshops and a solid foundation for entrepreneurs. A clear example is the Massachusetts Institute of Technology’s (MIT) three day Global Startup Workshop (GSW)that was held in Turkey on March 28-30. The National Endowment for Science, Technology and the Arts (NESTA) also promotes innovation in the United Kingdom.
In summary, it is clear to see that entrepreneurship is imperative for the well being of global economies, particularly ones in the developing world.
Significantly, countries affected by the ongoing Arab uprisings throughout the Middle East and North Africa are in sincere need of economic reform to create new opportunities for the youth. Tunisia represents a clear example of where change is occurring, albeit at a debated pace. Various political, economical and social reforms are needed to improve the living conditions of people throughout the region. Promoting entrepreneurial skills through a series of courses represents a positive step, that if pursued, may help these stagnant economies in the Arab world to grow.
Indeed, the growth of worldwide economies is immensely dependent on the nurture of entrepreneurs, as they concurrently stimulate the job markets and generate revenue.