Abstract
The economy has seen unprecedented growth in the past two centuries, raising average incomes by 30-fold. With this added wealth, living standards also improved greatly. Although many factors impact economic growth, it is accepted that entrepreneurship plays a key role. Therefore, understanding the antecedents of entrepreneurship and the link to economic development, often through institutions, should be of higher importance to researchers and policymakers. This Special Issue of the Journal of Risk and Financial Management sought to provide a brief overview of the economic growth literature and its link with entrepreneurship while adding insight through the Special Issue papers regarding the drivers of entrepreneurship in different contexts. Thus, the papers gathered here addressed several aspects of entrepreneurship and how it may be encouraged through networking, cornerstone investors in initial public offerings, new financing methods such as with cryptocurrencies, and through entrepreneur health. The research sites were primarily in Asia. This lead paper summarizes the issue’s papers while also providing a short overview of the economic growth literature and its link to entrepreneurship and institutions. This Special Issue, thus contributes to the empirical and theoretic research on the drivers of entrepreneurship and the association with economic growth.
Highlights
IntroductionWhat is role of entrepreneurship in economic growth and what factors encourage (or discourage) entrepreneurship? This Special Issue (SI) of the Journal of Risk and Financial Management (JRFM) sought to examine primarily the latter question through the papers of the issue while providing an overview answer to the first question in this lead paper of the SI
What is role of entrepreneurship in economic growth and what factors encourage entrepreneurship? This Special Issue (SI) of the Journal of Risk and Financial Management (JRFM) sought to examine primarily the latter question through the papers of the issue while providing an overview answer to the first question in this lead paper of the SI
If three of the more commonly argued “traditional” factors associated with economic growth—geography, capital accumulation, and trade—have small and often indirect effects on growth, what about other factors that have recently gotten more attention and shown more positive results in studies (Rodrik et al 2004)? Though entrepreneurship was slow to receive much attention from economists and even from management scholars until fairly recently (Baumol 1968; Baumol et al 2007; Urbano et al 2019), in the past couple of decades, the importance of entrepreneurship to economies (Acs et al 2008; Ahlstrom 2010) and quite directly through productivity gains has become increasingly evident to both researchers and policymakers (Aghion et al 2019; Audretsch et al 2006)
Summary
What is role of entrepreneurship in economic growth and what factors encourage (or discourage) entrepreneurship? This Special Issue (SI) of the Journal of Risk and Financial Management (JRFM) sought to examine primarily the latter question through the papers of the issue while providing an overview answer to the first question in this lead paper of the SI. Further research in areas including economic history, which studies the positive growth factors (Landes 1998; McCloskey 2006; Mokyr 2016), and development economics, which examines more of the hindrances (Acemoglu and Robinson 2012; Sachs 2003) has explained much about economic growth and development Other fields, such as geography (Diamond 1997), sociology (Goldstone 2007), management (Christensen and Raynor 2013; Tomizawa et al 2019), and entrepreneurship (Acs et al 2009; Schumpeter 1912) have contributed to examining and explaining the causes of the fast growth in incomes (and standards of living) over the past two hundred years in what has come to be called the Great Enrichment (McCloskey 2006). Regarding international trade and economic growth, McCloskey (2016, p. 584) concludes: “The gains from trade are good to have, but Harberger triangles show that they are small when put on the scale of a 9900 percent [Great] enrichment.”
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