The entrepreneurship is a vital force in the process of industrialization and Economic development. Entrepreneurship as a Theoretical Concept refers to the creative and dynamic process of Creating, Building, Launching, Operating & Managing a new business venture by taking calculated risks with due diligence and assuming the resulting rewards of personal satisfaction, Independence & Monetary gains. Entrepreneurs initiate and sustain the process of economic development in the following ways:

Create New Businesses: Path breaking offerings by entrepreneurs, in the form of new goods & services, result in new employment, which can produce a cascading effect or virtuous circle in the economy.

Add to National Income: Entrepreneurial ventures literally generate new wealth. New and improved offerings, products or technologies from entrepreneurs enable new markets to be developed and new wealth created.

Promote International Trade: An entrepreneur promotes international trade by selling his or her products abroad. Any entrepreneur would like a wider market. If there are more consumers to purchase his or her products, the higher his profits, which in turn adds value to the economy.

Improvement in living standards: Entrepreneurs set up industries which remove scarcity of essential commodities and introduce new products. Production of goods on mass scale and manufacture of handicrafts, etc., in the small scale sector help to improve the standard of life of a common man. These offer goods at lower costs and increase variety in consumption.

Backward and forward linkages: An entrepreneur initiates change which has a chain reaction. Setting up of an enterprise has several backward and forward linkages. For example, the establishment of a steel plant generates several ancillary units and expands the demand for iron ore, coal, etc. and thus provide backward linkages. Similarly, by increasing the supply of steel, the plant facilitates the growth of machine building, tube making, utensil manufacturing and such other units and facilitates forward linkage.

Question to Consider: 

1. How does an entrepreneur contribute to the economy and to the society?
2. What these small business owners contribute to the national economy?