Analyzing the Impact of Entrepreneurship on Australian Economy Growth

This essay explores the crucial role of entrepreneurial activity in driving the growth and development of the Australian economy. It defines entrepreneurship, highlighting the importance of new business ventures in job creation, innovation, and overall economic expansion. The essay discusses the impact of various factors, including economic, social, and political influences, on entrepreneurial activities. It examines the benefits of entrepreneurship, such as increased employment opportunities, improved living standards, and the generation of national income. The essay also analyzes the role of innovation, technological advancements, and government policies in fostering a favorable environment for entrepreneurs. Furthermore, it provides an overview of the Australian economy, its key sectors, and the factors that affect entrepreneurship, concluding with the significance of entrepreneurial activities in the country's sustainable economic growth and development.

Why is growing the level of
entrepreneurial activity critical to the
growth and development of the
Australian economy?

INTRODUCTION
Entrepreneur select best alternative in order to establish a business. They perform all
activities that is required to make organisation success and profitable (Kirzner, 2015). Further
this project discuss about importance of different entrepreneur activities and their meaning.
They critically examine business environment and understand customer’s behaviour and
preferences. Establishing new business has positive impact on the economy of Australia.
Entrepreneurship activities contribute in growth and development of the country. It is influenced
by various factors like economic factors, social factors, psychological factors and Political
factors. Entrepreneur implements policy and strategy in order to effectively utilise resource of
business. This project briefly discuss about importance of entrepreneur activity in growth and
development of Australian economy. Government of Australia promote entrepreneurship in
backward and remote areas in order to increase employment opportunities.
MAIN BODY
Meaning and importance of entrepreneur activity for Australia
Entrepreneur is a person who take initiative to start up new business. They are
responsible for all risk associated with business and performs all activities which are required
for establishing new business. They initially invest small amount and start up a new business.
They alone organise and manage all activities of business. Entrepreneurship is defined as an
activity carried out by individual in order to maximise share of profit. They focus establishing
and running a business, which involve high amount of risk (Bullough, Renko and Myatt, 2014).
There are various obstacles like lack of funding, economic crisis that entrepreneur face in
launching of new firm.
Entrepreneur select best alternates from the available opportunities. They adapt various
technology in their manufacturing process in order to reduce wastage and cost of production.
Businessman design products and services on the basis of demands of customers.
Entrepreneurship can be defined as an act of being owner or manager of an enterprise. They
critically examine business environment and understand customers’ behaviour and preferences.
Business activities play major role in growth and development of economy.
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It has been acknowledged that investments in new projects and business is at peak
because people are finding it profitable (Groenewegen and McFarlane, 2014). Australia has
developed good trading relation which has led to increase in exports. It has experienced
fluctuation in exchange rates, employment and inflation. New ventures has provided job to large
number of people living in the country. Economy of Australia has biggest threat from china
because of fall in prices of commodity. Government of Australia has taken various steps to boost
up investments and trade. Foreign direct investment has reduced tax rates, which affected
revenue of the country.
Entrepreneur innovates and modifies business process in order to maximise wealth an
increase productivity. This process is action oriented and it deals with motivating and influencing
the behaviour of individual to accomplish goals of organisation (Shepherd, 2015). Entrepreneur
activities are very important for country economy; some of them are discussed below.
Establishing business organisation will create job opportunity for people living in that
area. Effective workforce is required to carry out various business operations, entrepreneur hire
skilled and capable employees.
Company organises training and development plans for unskilled and new workers. This
will help in developing new skills in individuals. Small sector organisation provides employment
to large part of economy. New venture train and develop workforce and supply it to large and big
industries (Importance of entrepreneurship activity, 2018). Creating of job opportunities will
help people in increasing their living standard.
New ventures implement different innovative techniques in order to reduce cost of operations.
Entrepreneur discovers different approaches and implements them in business process. New
organisation invests large part of capital in research and development. This will help in
improving quality of products and increase level of satisfaction among customers (Terjesen,
Hessels, 2016). Innovative techniques will increase GDP in economy of Australia for example
entrepreneur provide online facilities to customers. This an innovative technique used by
entrepreneur to increase their sale. Online buying and selling of products and services will help
companies to ease with their regular transactions, thus growing opportunities for start up
business. These type of entrepreneur will enable further growth and development of economy.
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Entrepreneurial activities have Impact on community development and divide its employment
base between different small businesses organisation. It provides retail facilities and promotes
high level of ownership. Business provides employment to people living in remote areas which
has improved standard of people. Individual now spend maximum part of their income in
providing education. People of community are living high quality and stable life because of
increased level of enterprises in economy.
Entrepreneurial activities are adding in national income of the Australia. They generate large
wealth in economy. Existing business may remain restricted to current market situations. New
business will offer good quality and developed products to customers this will increase income
of business organisation. Entrepreneur may use innovative techniques to create new market and
customers. This situation will result in maximising wealth and increasing nation income (Spigel,
2017). Revenue generation will increase collection of tax and government spending. This will
help in overall growth and development of the country.
Political and economic integration of outsiders entrepreneurship plays an important role
integrating the new ventures into Australia economy. New organisation provides employment to
minorities and women. This will help in improving living standard of people.
Entrepreneurial activities Promotes research and development. New business organisation
implement innovative techniques and ideas to manufacture products. This process is evaluated
and monitored with the help of experiments. Government provides funds for research and
development to new business. This help in promoting research and development, which help in
growth and development of the economy. New entrepreneurs involve new ideas and procedure
with great energy and enthusiasm in order to achieve the goals of business.
Entrepreneurial activities Enhance standard of living, people consume large variety of
products and services which will help in increasing living standards of people. Market is full of
different types of products and goods. This provides facility to choose from wide range of
products. Entrepreneur provides different varieties of products because of innovative techniques
adopted by them. This increase income of people those are employed in new business (Golev and
Corder, 2016). Wide variety of products available in market will help in improving living
standard of country.
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Overview of Australian economy
Australia has the largest mixed economies in the world, with gross domestic product
(GDP) of 1.36 trillion in the year 2017. This is considered as the second wealthiest nation after
Switzerland. Small enterprise has increased the country GDP and it has become 14th largest
economy. Australian economy consist of service sector comprising 65.3% of GDP it provides
employment to large part of economy (Economy of Australia, 2017). This country has maximum
of natural resource which play major role in growth and development. Security exchange of
Australia which is operating in Sydney has the 17th largest stock exchange in the world. Australia
economy is not affected by the financial crisis because of strong banking system.
According to US dollar, per capita income of Australia has grown up to 52%. In order to
get the real picture of Australian GDP, it is significant to consider inflation rate. Customers
demand for innovative products and services and this is fulfilled by entrepreneur coming up with
new ideas. Establishing of new business has resulted in rapid growth and development of the
country. Business adopts innovative techniques and technology to satisfy customer’s
requirement. Trade of Australia has increased because of fluctuation in the global prices of
exports.
Alternation in the policy of Australia has resulted in flow of investments and trade
globally. Government has implemented various strategies to reach at stage of fiscal surplus.
Authorities implement various measures in order to protect their country from damages. Reserve
bank of Australia continuously alter monetary policy, which has led to flexible exchange rates.
Increase in imports has led to situation current account deficit and new entrepreneur invest
money in capital goods. Australia has strong exchange rate despite of recent economic
depreciation. Unemployment rate of Australia has decreased, which has created positive impact
during global financial crisis.
Importance of entrepreneur activity in growth and development of Australian economy
Entrepreneurship activity is significant for growth and development of every economy.
Technological advancements has brought opportunities and threats of business. In order to meet
the customers requirement, organisations offer quality products with minimum cos Businessman
focus on research and development activities in order to implement innovative techniques in
various procedures (Salamzadeh, 2015). There are generally two factors of productions which
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are implicit and explicit. To carry out business operations, entrepreneur can use machine or
labour these are known as implicit factor of production.
Australian economy is affected by development of entrepreneurship. they create new
business which give rise employment opportunities and increase level of completion in market.
Importance of entrepreneur activity are discussed below:
Businessmen establish venture in order to satisfy the demand of customers. They get
opportunity to produce new products and capture market. Entrepreneur garb opportunities from
the present business environment. They design products according to needs of customers, this
key factors that help economic growth of Australian economy (Cavusgil and Knight, 2015).
Implementation of innovative strategies will increase productivity of business. Innovative
strategies will reduces cost of production, thus revenue of organisation will increase.
Entrepreneurship activities contribute in growth of economy.
In order to perform all business activities effectively entrepreneur their skill workforce.
Increase in employment will uplift economic opportunities and increase living standard of
people. Entrepreneur can expand their business activities globally because of technological
advancement. Business imports capital goods from other countries, this will create direct impact
of the economy of country. It will increase productivity and earning capacity of organisation.
Trading activities will increase in tax revenue of the country which will promote over all
development of population. This will also help in establishing good relations with other
countries. There are various economic and political factors affecting the export and important of
goods. Entrepreneur invests huge part of their capital on infrastructure and transportation.
Foreign market play significant role in advancement of economy and it is responsible for overall
growth.
Innovative strategies helps to increase productivity and promote economic development.
Innovation deals with inventing new products according to customers desire (Al-Bakri and
Katsioloudes, 2015). Entrepreneurs have ability to produce new products with the help of
knowledge and experience. Economic growth of the country is assessed by technological
advancement and creative application of ideas. Implementation of innovative techniques requires
capable employees and educated customers. Therefore, training seminars will enhance
productivity of workforce and their standard of living.
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Entrepreneur has to deal with various problems and issues related business environment.
They implement various strategy to deal with changing climate, lower emission of greenhouse
gas, etc. Organisation makes use of reliable innovative techniques like irrigation technology,
electricity in order to solve these issues. This will increase quality of product, which will
increase economic development of Australia.
Entrepreneur implements policy and strategy in order to effectively utilise resource. This
will reduce the overall production and operation cost of business. There are various social
economic challenges which affect the economy of Australia. It is significant to look after safety
and security of country. Innovation in business operation will help organisation to address health
care problems. This will increase quality of life and reduce cost of health care services.
Entrepreneurship activities play major role in alleviating poverty of Australia by
providing them employment (Kuratko, Morris and Schindehutte, 2015). This has shifted the
poverty line upwards, this has promoted the economy of Australia . Poverty reduction and
employment generation are key factor of economic growth and development.
Factors affecting entrepreneurship in Australia
Entrepreneurship is influenced by various factors like economic development,
technological advancement and education. This has both positive and negative impact on the
business activities. Some of the factors are discussed below.
Economic factors directly influence entrepreneurship because individuals start up new
business after considering these factors. In order to establish new business, entrepreneur requires
factors of production like capital. According to Spigel (2017); They perform various activities to
collect for investment. Businessmen buy new machine, raw materials and lands to carry out
business activities. In order to start business entrepreneur needs capital and funds. Capital
formations have positive impact because entrepreneur can effectively utilise land and other
resources to produce goods. This will help in maximising profits and minimising wastage that
incur in production process. it is important to have adequate supply of factors of production.
Australia has strong economy and this will be beneficial for new entrepreneur. It will help them
in analysing economical situations of the country which has direct impact on entrepreneurship.
Inflation is a situation where prices of products are continuously rising, this will have negative
impact on entrepreneurship. Due to rise in inflation people will stop buying that product, this will
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reduce their sale. Deflation is a situation in which price of products are decreasing because of
this entrepreneur will get motivated and start up new business.
Quality and availability of workers will influence growth and development of
entrepreneurship. Business build strong infrastructure in order to promote mobility of labour. It
is important to select capable workforce to carry out business operation effectively. They focus
on quality of workers rather than quantity to create positive impact on entrepreneurship. To
survive in this competitive world, it is important to establish good brand image. Expansion of
business operations requires effective transportation facilities and raw materials (Golev and
Corder, 2016). As per Burns (2016) Entrepreneurship helps in establishing good infrastructure
like roads and telegraph system. Effective communication contributes in maintaining sustainable
business economy. If the economy of country is not good it will affect business operations.
Social factors influence and encourage various activities of business, which is help in developing
and improving society.
As explained by Kirzner (2015) Behaviour and attitude of entrepreneur contribute in
development of economy. Actions of individual are influenced by different types of cultural
practices and values. According to social mobility, people has freedom to move from one culture
to another. Background of family influences the decisions of entrepreneur and mobility of
business. As denoted by Cavusgil and Knight (2015) Educated and capable individual evaluate
business environment and understand problems related organisation. Society encourage
individual to establish new venture and earn huge amount of profits.
There are various social factors, which influence prestige, security and power of
businessmen. People of Australia are involved in business activities this will promote growth and
development of entrepreneurial activities. Psychological factors help in achievement is
motivation factor that create positive impact on entrepreneurship. As explained by Al-Bakri and
Katsioloudes (2015), this theory was proposed by David McCelland. Decrease in level of income
with the economy will have negative impact on entrepreneur activity as customers will not be
able to buy products and services offered by firm. Increase in income will motivate customer to
spend their money in buying of products and services.
Political factors help entrepreneur to take better business decisions and increase firm
profitability. Policies of government influence operation of business. Political factors may
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increase the chances of loss, so it is significant to understand political factors. Government
policies are dynamic in nature. For example increase and decrease in tax rate will have direct
impact on business decisions. Increase in corporate tax, will have negative impact because
entrepreneur will have to pay more tax. Decrease in tax rate will have positive impact as the sale
of business will increase enabling them to earn more profit. Political situation of country affects
performance of entrepreneur.
The government of Australia encourage and motivate employees to establish their
business in remote areas (Groenewegen and McFarlane, 2014). This will help in creating job
opportunities and improving the standard of living in backward locality. Political factors
encourage establishment of business. They provide tax incentives, subsidies, lower transportation
cost in order to encourage business activities.
CONCLUSION
This report explain about importance of entrepreneurship. They perform all activities that
are required in establishing and running business. Businessmen implement advance techniques
manufacturing process to reduce cost of operations and increase profit. Entrepreneurship deals
with motivating and influencing activities that are important for country economy. Business
organisation helps to create employment opportunities. These activities generate large amount of
revenue and increase tax collection. Market consists of large variety of products and services,
which will improve living standard. Australia has the largest mixed economy in the world and it
is the second wealthiest nation. Innovative techniques have resulted in rapid growth of
entrepreneur. Australian economy is uplifted by development of entrepreneurship. There are
various factors like economic, social, psychological, political which affect operation of business.
These factors directly influence entrepreneurship because businessmen buy new machine, raw
materials and lands to carry out business activities. Entrepreneur implements innovative
techniques to satisfy demand of customers. The play crucial role in growth and development of
the Australian economy.
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REFERENCES
Books and Journals
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resilience and self‐efficacy for entrepreneurial intentions. Entrepreneurship Theory and
Practice.38(3). pp.473-499.
Burns, P., 2016. Entrepreneurship and small business. Palgrave Macmillan Limited.
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perspective on early and rapid internationalization Journal of International Business
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Kirzner, I.M., 2015.Competition and entrepreneurship. University of Chicago press.
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Shepherd, D.A., 2015. Party On! A call for entrepreneurship research that is more interactive,
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Online
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Economy of Australia. 2017. Accessed through;
<https://www.heritage.org/index/country/australia>
Importance of entrepreneurship activity. 2018. Accessed through;
<https://iedunote.com/importance-of-entrepreneurship>
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