Entrepreneurs refer to business people who look for inspirational ideas and convert them into cost-effective products or services that meet the needs of their consumers in the marketplace. In this endeavor, they act as catalyst in fostering economic development of a particular region or country. In fact, entrepreneurship is the key factor that combines land, labor and capital to trigger economic activities in such places. They play a vital role in the development of industries in the manufacturing, agriculture and service sector of the economy.
Walter Viola – The role entrepreneurs play in economic development
Economic experts point out the following important role entrepreneurs play in the economic development of a particular country or region:
- Encourage capital formation
Entrepreneurs have to ability to mobilize the idle cash savings members of public have with them and put such money to productive use. In many cases, they use the funds they have at their disposal and borrow they remaining amount of money need to establish their start-up concerns. This leads to the generation of wealth which is essential for the economic development of a country or a particular region.
- Employment generation
The business establishments entrepreneurs set up go a long way in providing job opportunities for people without a source of livelihood. This goes a long way in solving the unemployment problem many underdeveloped countries have to overcome to ensure better living conditions for their inhabitants. Moreover, it is also a hindrance to effective economic development of such places. As such organization grow in size, such employment opportunities also increase.
- Equitable wealth distribution
Walter Viola says entrepreneurship leads to equitable distribution of wealth among people of diverse backgrounds by generating more economic activity. This goes a long way in creating equitable societies where such individuals have adequate incomes to sustain themselves.
- Improves living standards
Entrepreneurs play a vital role in uplifting the living standards of people in a particular place or country by introducing innovative products that cater to their needs. Moreover, these businesspersons are able to ensure the price of such goods is within the reach of most individuals living in such areas.
- Develops backwards areas and connect them to forward ones
Entrepreneurs prefer to work in an environment that encourages change in their endeavor to maximize their profits by introducing innovative products in the marketplace. When they set up their start-up businesses in places where labor is cheap and take advantage of changing technology, it encourages the development of backward areas. This acts as a stimulant to economic development.
- Encourages experts
Entrepreneurs go a long way in enhancing a country’s export trade with other nations. The large-scale innovative goods or services they produce at competitive prices help the host country to earn valuable foreign exchange and curb unnecessary imports.
Countries need to encourage enterprise individuals to become successful entrepreneurs if these nations want to ensure proper economic development for their people. Walter Viola says it is an activity that leads to wealth generation, equal distribution of income, reduce unemployment and improves living standards. This goes a long way in enhance the quality of life people living in different parts of the world.