Essay on Entrepreneurship, Innovation, and Economic Impact

This essay delves into the intertwined concepts of entrepreneurship and innovation, exploring their definitions, benefits, and relationship. It begins by defining entrepreneurship as the process of exploiting market opportunities to develop unique businesses, referencing theorists like R. Cantillon and J. Schumpeter. The essay then defines innovation, highlighting its importance in achieving competitive advantages and differentiating it from entrepreneurship. It discusses the views of Drucker, Mohr, Covin, Slevin, Lumpkin, and Dess, emphasizing innovation as a process of change that adds value. The essay compares the benefits of entrepreneurship and innovation, acknowledging that innovation is a subset of entrepreneurship and essential for new business development and economic growth. It further explores the link between these concepts using Schumpeter's theory of creative destruction and provides the example of UBER to illustrate the successful integration of innovation and entrepreneurship. The essay concludes by emphasizing the importance of integrating both concepts for business success.

Running head: ESSAY 0
Entrepreneurship and
innovation

ESSAY 1
ESSAY:
There are various definitions of entrepreneurship that has been given by the theorists. In general,
entrepreneurship can be expressed as the process that deals with exploiting the market
opportunities in order to develop a business in a unique and different way. R.Cantillona has
defined entrepreneurship as self-employed. As per him the entrepreneur need to balance their
activities according to the demands of the market. Another author J. Achumpeter has defined
entrepreneurship as the vehicle that supports the economy of the place to move forward.
Likewise many definitions of entrepreneurship have been proposed but entrepreneurship in total
is regarded as the set of traits and that is required by the driver of the entrepreneurship that is
entrepreneur (Drucker, 2014). There are several qualities that the leader should possess and one
of the qualities is innovator. This makes innovations the basic element of entrepreneurship
Entrepreneurship is the practice that can be practiced in the institution that is considered as the
carrier of innovation. Innovation is the aspect that is very necessary in terms of performing
something unique in the business and to attain the competitive advantages over the other
businesses. Definition of innovation has always been a great topic of discussion amongst the
researchers and the authors. It has been identified that the innovation can be defined differently
or the different organisations as per their way of defining their activities.
The ability of the person to innovate is always found to be important for the organisations to get
success. This suggests that innovation is the subset of entrepreneurship. Drucker has defined
innovation as one of the two basic functions of the organisations (Drucker, 2014). Mohr, on the
other hand described innovation as the new change that can be implemented to the organisation.
As far as the definition by Covin şi Slevin, Lumpkin and Dess, Knox is considered, it has been
analysed that innovation is the process that adds value to the organisation (Morris, Kuratko &
Covin, 2010). Other than these definition, there are many definition t has been postulated for
innovation. In total, it has been analysed that innovation is the process to bring new and unique
process or products to the organisation that adds value to the same and helps the entrepreneur to
perform his entrepreneurial activities successfully.
Drucker suggest that entrepreneurship always look for making changes and as per the definition
of innovation, it is considered as the process of bringing the change thus these concept that are

ESSAY 2
entrepreneurship and innovation are so much related to each other (Stevenson & Jarillo, 2007).
But have different types of benefits in the organisation. Entrepreneurship is the activity or the
process to conduct the business activities and provides a path to conduct the same while
innovation at the same time makes it unique to have competitive advantage. Innovation is itself a
change while entrepreneurship is the process that is above recognizing that change.
Entrepreneurship creates new business. It has been analysed that entrepreneurship results in
development of the business that contributes in the economy (Bessant & Tidd, 2007).
Trailblazing contributions by entrepreneurs, in the form of new goods and services, can produce
a flowing effect by inspiring related businesses or sectors aiding the new venture, furthering
economic development. Innovation is also the aspect that contributes in economic development.
This is because innovation in the business helps the companies to enter the new market with
competitive edge over other competitors. Entrepreneurship also helps in creating social change in
the society and this is the major advantage of entrepreneurship (Schaltegger & Wagner, 2011).
By providing new and unique contributions of new goods and services, businesspersons break
away from tradition and indirectly support independence by reducing dependence on out-dated
systems and technologies. This leads to better life quality and the economic freedom to the
society. Innovation at the same time help the business to have competitive advantage and serve
the market with new and innovative product offerings that makes the life of the people very easy.
As far as the comparison between the benefits of entrepreneurship and innovation is considered,
it has been analysed that most of its benefits are very much related because innovation is termed
as the sub set of entrepreneurship (Doganova & Eyquem-Renault, 2009). Without innovation,
entrepreneur cannot perform its functions effectively. Innovation is the base of every new
business that enters the industry and it is the basic element that is required to attain the
competitive advantage in the market. Innovation is about applying the creativity that leads to the
development of new ideas and processes and entrepreneurship is applying the innovation in order
to make it practical and meaningful so that those ideas can get the life.
It is very important to learn about the relation between entrepreneurship and innovation. It has
been analysed that both these terms are used at each other’s place by the people who are not clear
with the differentiation between the two terms (Anokhin & Schulze, 2009). As far as innovation
is concerned, it has been analysed that it is related to invention of the product and the process

ESSAY 3
that changes the proceeding concept of the same. It has been analysed that the link of
entrepreneurship and innovation is difficult to be explain than it sounds. Various models are
there that shows different relationship between entrepreneurship and innovation. It has been
analysed that when both the concept are integrated, it results in successful business. A good idea
and innovation is the tool that remains in the hands of the entrepreneur. This suggests that
innovation is the single aspect of entrepreneurship (Windrum & Koch, 2008). When the change
in technology takes place, this leads to invention while when it includes the business activity hat
it results in innovation. An entrepreneur performs the business activities in order to gain profit
and growth and innovation is one of the characteristic of entrepreneur.
Schumpeter suggests that entrepreneurship is the creative destruction. Creative destruction
means the entrepreneur introduces the new idea and links the activities of the business to the
economic growth and development of the country or the place where the company operates.
Schumpeter’s theory of economic development is one of the theories that integrate
entrepreneurship with innovation (Onetti, Zucchella, Jones & McDougall-Covin, 2012). This is
the theory that deals with circular flow. It has been analysed that any changes that needs to be
implemented should be in the flow and these changes can only takes place with he helps of
innovations and innovative practices. As per this model, innovation can be defined as the
alteration in the processes or the products that already exist in order to make profits (Ketchen,
Ireland & Snow, 2007). According to this model, any innovation involves several factors such as
introduction of the new products, introduction of the new process, opening of the new market
and gaining the competitive advantage in the industry. These are the factors that can be
combined differently for the innovation process to start (Ketchen, Ireland & Snow, 2007). These
practices are practiced by some of the agents known as entrepreneurs. Entrepreneurs are the
central figure in the model of Schumpeter. It has been analysed that conducting business
activities are not the only job of the entrepreneur but it is required by him to make innovations in
the process and the products.
Various examples can be studied in order to find out the combination of innovation and
entrepreneurship is UBER is the one of the great business examples that justified that innovation
can helps in providing entrepreneurial success. It is the application based taxi company that
provide taxi services to the customers. The company has launched its services in 2010 and now it

ESSAY 4
is found to be in 200 cities (Szirmai, Naudé & Goedhuys, 2011). It is considered as one of the
major threats and competitor for the other taxi services. The innovation is about connecting the
driver and the rider by the application that is installed in the mobile phones. UBER also have the
rating system in which the customers and the driver both have the facility to rate each other. It
has been analysed that taxi services were there since years but launching a business with an
innovation makes UBER interesting and successful (Trimi & Berbegal-Mirabent, 2012). This
suggests that entrepreneurship when coupled with innovation results in success. However, it is
required that the innovation should be accepted by the market.
It has been concluded from the discussion that innovation can be defined as the process of
generating new ideas by exploiting the resources available in the market while entrepreneurship
is about implementing such innovative practices and ideas to give them life in order to earn
profits and revenues. As both of these term are different but the differentiation is not that much
clear in nature, however, the association and linkage of these concepts results in successful
business as a whole.

ESSAY 5
References:
Anokhin, S., & Schulze, W. S. (2009). Entrepreneurship, innovation, and corruption. Journal of
business venturing, 24(5), 465-476.
Bessant, J., & Tidd, J. (2007). Innovation and entrepreneurship. John Wiley & Sons.
Doganova, L., & Eyquem-Renault, M. (2009). What do business models do?: Innovation devices
in technology entrepreneurship. Research Policy, 38(10), 1559-1570.
Drucker, P. (2014). Innovation and entrepreneurship. Routledge.
Ketchen, D. J., Ireland, R. D., & Snow, C. C. (2007). Strategic entrepreneurship, collaborative
innovation, and wealth creation. Strategic Entrepreneurship Journal, 1(3‐4), 371-385.
Morris, M. H., Kuratko, D. F., & Covin, J. G. (2010). Corporate entrepreneurship & innovation.
Cengage Learning.
Onetti, A., Zucchella, A., Jones, M. V., & McDougall-Covin, P. P. (2012). Internationalization,
innovation and entrepreneurship: business models for new technology-based
firms. Journal of Management & Governance, 16(3), 337-368.
Schaltegger, S., & Wagner, M. (2011). Sustainable entrepreneurship and sustainability
innovation: categories and interactions. Business strategy and the environment, 20(4),
222-237.
Stevenson, H. H., & Jarillo, J. C. (2007). A paradigm of entrepreneurship: Entrepreneurial
management. In Entrepreneurship (pp. 155-170). Springer, Berlin, Heidelberg.
Szirmai, A., Naudé, W., & Goedhuys, M. (Eds.). (2011). Entrepreneurship, innovation, and
economic development. Oxford University Press.
Trimi, S., & Berbegal-Mirabent, J. (2012). Business model innovation in
entrepreneurship. International Entrepreneurship and Management Journal, 8(4), 449-
465.

ESSAY 6
Windrum, P., & Koch, P. M. (Eds.). (2008). Innovation in public sector services:
entrepreneurship, creativity and management. Edward Elgar Publishing.