CHAPTER ONE
OVER VIEWS OF ENTREPRENEURSHIP IN THE WORLD
OVERVIEWS OF TANZANIA
ENTREPRENEURSHIP
In Tanzania the concept of
entrepreneurship is not a new concept. For many years Tanzanian people
conducted various trades, for example during pre colonial era Yao people of
Southern Tanzania conducted a business with Nyamwezi and Kamba through batter
system where Long Distance Trade operated in the 19th century. What
change happen on this trade is that; now days Tanzanian use money as a medium
of exchange than the previous where trade conducted through batter system means
exchange for goods for goods.
The concept of entrepreneurship was
first established in the 1700s, and the meaning has evolved ever since. Many
simply equate it with starting one’s own business[1] where in
the United States of America were 1865-1920[2]. The field
of social entrepreneurship is in its infancy, and currently lacks awareness and
credibility. What’s needed is a definition that creates focus and understanding,
(Roberts & Woods, 2005).
Origins of the Word “Entrepreneur”
Various
Scholars differ in the specific period of the origin of the word “entrepreneur”. Some of them focus on 13th
Century, and many of them look on 17th century.
The word
entrepreneur comes from the 13th century French verb “entreprendre”, meaning to do something or to undertake. By the 16th
century, the noun entrepreneur had emerged to refer to someone who undertakes a
business venture. The first academic usage of the term was by economist Richard
Cantillon in 1730. For Cantillion, the bearing of risk, engaging in business
without an assurance of the profits that will be derived, is the distinguishing
feature of an entrepreneur. The term entrepreneur was further popularized by
economist Jean Baptiste Say, who in the early 1800s, used the term to refer to individuals
who create value in an economy by moving resources out of areas of low
productivity and into areas of higher productivity and greater yield. In 1848,
economist John Stuart Mill used the term in his very popular book, Principles
of Political Economy. To Mill, the distinguishing feature of an entrepreneur
was that they assume both the risk and the management of a business[3].
Dees (2001), in common parlance,
being an entrepreneur is associated with starting a business, but this is a very
loose application of a term that has a rich history and a much more significant
meaning. The term “entrepreneur” originated in French economics as early as the 17th and
18th centuries. In French, it means someone who undertakes not an undertaker”
in the sense of a
funeral director, but someone who undertakes a significant project or activity[4].
More specifically, it came to be used
to identify the venturesome individuals who stimulated economic progress by finding
new and better ways of doing things. In the 20th century, the economist most
closely associated with the term was Joseph Schumpeter. He described
entrepreneurs as the innovators who drive the “creative-destructive”
process of capitalism, (Ibid).
Phases of Entrepreneur in the World
The evolution of world
entrepreneurship varies depending time and nature of production[5]. Within
this part we look on how entrepreneurs gained its momentum from 13th
Century.
PHASE ONE: 13th to 15th
Century
The earliest definition was from the
13th century, where we learn the words root. The origin of the English word entrepreneur comes
from the French word entreprendre, which can be translated to mean to do
something or to undertake.
PHASE TWO: 16-17th Century
In the 16th century, we
see the first mention of business used in the definitions. Therefore, we find entrepreneur defined as
someone who undertakes a business venture.
PHASE THREE: 18th Century
Richard Cantillon (in about 1730 in
academia) ascribed to a definition which added a risk component to the
definition. Therefore, an entrepreneur
was someone who undertakes a business venture with no guarantee of profits. Said
another way an entrepreneur is the bearer of risks inflicted by changes in
market demand.
PHASE FOUR: 19th Century
During the 19th century, three
economists post views on entrepreneurship:
John Baptiste Say, John Stuart Mill, and Alfred Marshall. This is the first century in which we begin
to see the definition include actions and special skills required of entrepreneurs.
Jean Baptiste Say determines that the entrepreneur is someone who earns profits
by shifting resources from areas of low productivity to areas of high
productivity. He further is known to
require the entrepreneur to possess knowledge and judgment so that the entrepreneur
is constantly aware of the costs and prices of his goods and can determine how
to compare opportunities.
Mid-century of 19th, John
Stuart Mill describes the entrepreneur as someone who assumes not only the risk
of a business venture (as a capitalist) but also the management of the business
venture. It is this addition of a
management component that builds on Says judgment requirement.
In the late 1800s Alfred Marshall
emphasizes the importance of entrepreneurship by tying the resource component
(from Say) and management component (from Mill) together. Marshall claims that four primary factors are
necessary for production: land, labor,
capital, and organization (which is the key factor to coordinate the other three
resources).
PHASE FIVE: 20th -21st Century
By mid-20th century, the importance
of innovative talent, the ability to find and profitably introduce new and
better products, services and processes was recognized and included in the entrepreneur's
"job description.
Meaning of Entrepreneurship? Social
Entrepreneurship, Entrepreneur and Small Business
What is Entrepreneurship?
“Entrepreneurship, in its narrowest sense, involves capturing
ideas, converting them into products and/or services and then building a
venture to take the product to market” (Johnson, 2001, p. 138). Entrepreneurship
and innovation are positively related to each other and interact to help an
organization to flourish[6].
References
Roberts, D., & Woods, C., (2005), Changing the world on a
shoestring: The concept of social entrepreneurship
[2] Naomi R. Lamoreaux, UCLA and NBER, Entrepreneurship
in the United States, 1865-1920,
University of California, Bunche
Hall
[4]
Dees, J. G, (2001), The Meaning of “Social
Entrepreneurship,
[5]
http://www.entrepreneurialprocess.com/history.htm
and http://louisville.bizjournals.com/louisville/stories/2003/06/30/smallb5.html
[6]
Fung Zhao (2006), Entrepreneurship and Innovations in E-Business: An
integrative perspective, Royal Institute of Technology University, IDEA Group
Publishing
I' m in the Process of Finalizing my Book
Written by Ausi Chiwambo (2014) Teofilo Kisanji University-Tanzania
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