a.

Economists’ view
b. Sociologists’ view
c. Psychologists’ view
d. Managers’ view

Economists’ view
The economists view him as a fourth factor of production along with land labor and
capital.
1. Land.
2. Labor.
3. Capital.
4. Entrepreneurship.

· Economic incentives are the main motivators for entrepreneurial activities.

· Economic incentives include taxation policy, industrial policy, sources of finance and
raw material, infrastructure availability, investment and marketing opportunities.
· Entrepreneurship and economic growth take place when the economic conditions are
favorable.
· Mainstream economists view the supply of entrepreneurship as highly elastic.
· J.B. Say has stated that it is function of the entrepreneur to rationally combined the
forces of production into a new producing organization
· Kirzener viewed the entrepreneur as a disequilibrating force. It is the alertness to
unnoticed opportunities which creates a tendency of the ever-circular flow of
equilibrium.
· SCHUMPETER’S entrepreneur possess three qualities:
1. An intuitional capacity to see things in a way which afterwards proves to be true;
2. A kind of effort of will and mind to overcome fixed habits of thinking; and
3. The capacity to overcome social opposition against doing something new.

Sociologists’ view
· The sociologists feel that certain communities and cultures promote entrepreneurship
like for example in India we say that Gujaratis and Sindhis are very enterprising.
· Sociologists focused on theories that considered the role of social norms and legitimacy
as well as social mobility in understanding the supply of entrepreneurship in a society.
· According to Peter Marris, to assemble or reassemble from what is available, very
concrete kind of imagination, to see what others have missed , sensitivity to business and
social environment, zest in industrial development and entrepreneurial courage are the
factors that make an entrepreneur.
· According to the sociologists the presence or absence of certain social baits motivate or
de-motivate individuals from taking up entrepreneurial ventures. some of the important
ones are:
a. Family background: This factor means the size of the family, type of the family
along with economic situation. To some extent joint family provides better financial
security in the form of joint property holdings, which allows an individual to
undertake risks of business. Joint family system also helps in expansion of business,
at the same time; major drawback of joint family business is lack of independence
with regard to decision-making.
b. Religious background: In certain societies where religions has a strong
influence on a person’s day to day life, it acts as a factor influencing
entrepreneurship, for ex: the religious philosophies mould a person’s thinking
towards money, wealth, interest on capital, profiteering, ethics, adaptation or
rejection of certain products or business ideas etc.
c. The age of entry to entrepreneurship: The time and age of starting
entrepreneurial venture, this in turn may be dependent upon social factors such as
exposure to family business, age of marriage and responsibility of supporting a
family.

d. Occupational background: It has been significantly found that, people coming

from a business background in the family have a better aptitude towards
entrepreneurship.

Psychologists’ view
The entrepreneur…
· …wants to prove himself/herself more than others
· …has the pressure to reach something
· …wants to be in control
· …is convinced he/she can do it better
· …is not afraid of taking risks
· Psychologists focused on such factors as the achievement-orientation and
statusorientation
of individuals within a population to consider their likelihood of engaging in
entrepreneurial behavior.
· Psychologists emphasize that entrepreneurship is not likely to emerge or develop when a
society has a sufficient supply of individuals possessing certain psychological
characteristics such as adventures nature, ability to take calculated risk, communication
skills, leadership qualities, hardworking by nature, etc.
· The supply of entrepreneurs depends on individuals’ psychic needs for achievement
rather than on the desire for money (but monetary rewards may still constitute a symbol
of achievement for entrepreneurs).
· Entrepreneurship gets a boost when society has sufficient supply of individuals with
necessary psychological characteristics
· The psychological characteristics include need for high achievement, a vision or
foresight, ability to face opposition
· These characteristics are formed during the individual’s upbringing which stress on
standards of excellence, self reliance and low father dominance
· According to McClelland it is high need for achievement which drives people
towards entrepreneurial activities.
· Among psychologists, Frank Young describes an entrepreneur as a change-agent.
· K. L. Sharma maintains that entrepreneurs are men with qualities of leadership in
solving
persistent professional problems; but those persons likewise demonstrate eagerness to
seize unusual opportunities.
Managers’ view
· Managers feel entrepreneurs are innovators who come up with new ideas for products,
markets or techniques.
· According to Peter Kilby
An Entrepreneur is one who performs the following functions:
1. Perception of market opportunities
2. Gaining command over scarce resources
3. Purchasing inputs
4. Marketing of product & responding to competition
5. Dealing with public bureaucracy (concessions, licenses, taxes)
6. Management of human relations within the firm
7. Management of customer & supplier relations
8. Financial management
9. Production management
10. Upgrading processes and product quality
11. Introduction of new products

THEORIES OF ENTREPRENEURSHIP

The Economist’s View

According to the economist entrepreneurship and economic growth will take place
in those situation where particular economic conditions are most favorable.
 According to J.B.Say rationally combining the forces of production into a new
producing organization is the function of an entrepreneur.
 According to Cantillon an entrepreneur is an uncertainty bearer buying at a fixed
price and selling at an uncertain price.
 Entrepreneur connects different markets, he is capable of gap-filling, he is input
completer and he creates or expands things.
 Small industry is a natural habitat of the entrepreneur where his role is like that of a
striker who keeps the fire burning.
 The entrepreneurship development in a particular country largely depends upon the
economic policy, programme and economic environment of that country.

 The Sociologist’s View

 It emerges under a specific social culture.

 According to sociologist’s social sanctions, cultural values and role expectations are
responsible for the emergence of entrepreneurship.
 Society values are most important determinants of attitudes and role expectation.
 Sociologist’s consider the entrepreneur as a role performer corresponding to the role
expected by the society.
 According to Flavia, the function of an entrepreneur is to co-ordinate at every stage
i.e. beginning, maintenance and expansion.
 Every entrepreneur needs two qualities they are Optimistic outlook and Dynamism
e.g.
 Protestant ethic from west emerge as new class of industrialist .
 Samurai from Japan ,
 Christians from Lebanon,
 Halai Memon Industrialist in Pakistan ,
 Marwaris & Parsis in India

 The Psychologist’s view

 It is most likely to emerge when a society has sufficient supply of individuals

possessing particular psychological characteristics.
 It’s the high need for achievement which drives people towards entrepreneurial
activities .
 Individual with high achievement motive tend to take keen interest in situation of high
risk ,desire for responsibility and desire for task performance
 Entrepreneur possesses three things i.e. an institutional capacity to see things in a
way which later proves to be true, a kind of effort of will and mind to overcome fixed
habits of thinking, lastly the capacity to overcome social opposition against doing
something new.
 Frank Young describes an entrepreneur as a change agent
 T.V. Rao describes entrepreneurship as a creative and innovative response to
environment.

 Managerial Views

 This view gives more importance to the managerial aspects like perception of
market opportunities and operational skills as qualities required to carry out an
enterprise.
 Entrepreneurship is the outcome of complex and varying combination of socio
economic, psychological and other factors.