Entrepreneurship and Innovation

Abstract

This chapter examines entrepreneurship and innovation as fundamental elements of American-style capitalism. It first provides a historical background on how America got to an era of cowboy capitalism before discussing how the American economy evolved after the settlement of the western frontier. The major changes moved in the direction of large industrial processes and an attitude that, among firms, bigger is better; this period is known as the managerial economy, which lasted through the 1970s. The chapter also considers why the information technology revolution happened in America and concludes with an assessment of whether the past three decades really is a new era of cowboy capitalism—a shift from the managerial economy that dominated for most of the twentieth century to a renewed entrepreneurial economy.