In the context of employment generation the three terms- Income generation, Self-employment and Entrepreneurship are often used interchangeably.
Income generation is the initial stage in the entrepreneurial process in which one tries to generate surplus or profit.
They are often taken on part- time or casual basis to supplement income.
Self-employment is the second stage in the entrepreneurial process and refers to an individual’s fulltime involvement in his own occupation.
Entrepreneurship is the terminal stage of the entrepreneurial process wherein after setting up a venture one looks for diversification and growth.
An entrepreneur is always in search of new challenges.
An entrepreneur is not a routine businessman he might not have resources but he will have ideas.
He is innovative and creative. He can convert a threat into an opportunity.
Small businessmen might shut- down or change his business if he anticipates losses but an entrepreneur will try again after analyzing the situation.
On the other hand an entrepreneur can leave a perfectly running business to start another venture if he so desires.
An entrepreneur is a person who starts an enterprise. He searches for change and responds to it.
A number of definitions have been given of an entrepreneur :
– the economists view him as a fourth factor of production along with land labour and capital.
– the sociologists feel that certain communities and cultures promote entrepreneurship. Still others feel that entrepreneurs are innovators who come up with new ideas for products, markets or techniques.
To put it very simply an entrepreneur is someone who perceives opportunity, organizes resources needed for exploiting that opportunity and exploits it.
Some definitions of an entrepreneur are listed below:
Stems : from the French word ‘entrependre’ meaning one who undertakes or one who is a ‘go-between’
Richard Cantillon : An entrepreneur is a person who pays a certain price for a product to resell it at an uncertain price, thereby making decisions about obtaining and using the resources while consequently admitting the risk of enterprise.
J.B. Say : An entrepreneur is an economic agent who unites all means of production- land of one, the labour of another and the capital of yet another and thus produces a product. By selling the product in the market he pays rent of land, wages to labour, interest on capital and what remains is his profit. He shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.
Schumpeter : According to him entrepreneurs are innovators who use a process of shattering the status quo of the existing products and services, to set up new products, new services.
David McClleland : An entrepreneur is a person with a high need for achievement [N-Ach]. He is energetic and a moderate risk taker.
Peter Drucker : An entrepreneur searches for change, responds to it and exploits opportunities. Innovation is a specific tool of an entrepreneur hence an effective entrepreneur converts a source into a resource.
Kilby : Emphasizes the role of an imitator entrepreneur who does not innovate but imitates technologies innovated by others. Are very important in developing economies.
Albert Shapero : Entrepreneurs take initiative, accept risk of failure and have an internal locus of control.
G. Pinchot : Intrapreneur is an entrepreneur within an already established organization.