Abstract
This paper intends to explain the relationship between innovation and entrepreneurship as crucial determinants of economic growth. Individual differences are what scholars in the emerging field of entrepreneurship view as relevant, usually undermined factors that account for the success of entrepreneurs. Policymakers usually initiate public policies from what economists have to say. It is not surprising policymaking process originates as top down approach. This paper tries to accomplish two tasks. “In informal attempts to explain [the growth of free market economy], the terms ‘innovation’ and ‘entrepreneur’ frequently recur. Yet in the main body of our writings on microeconomic theory these two words are also scarcely to be found”.
Highlights
As the world economy is moving towards entrepreneurial, knowledge-based, Innovation is perceived as the critical source of competitive advantage [1] and is one of the most important factors responsible for economic growth [2]
As economists have begun to regard both innovation and entrepreneurship as the crucial determinants of economic growth, they still cannot find the way to account for individual differences
We would like to review the recent development of theories of innovation and entrepreneurship
Summary
As the world economy is moving towards entrepreneurial, knowledge-based, Innovation is perceived as the critical source of competitive advantage [1] and is one of the most important factors responsible for economic growth [2]. Later that innovation was put into equations, with the development of endogenous growth models [4,5,6]. Acs et al [8] argues for the differences between knowledge and economically relevant knowledge They extend endogenous growth model to include “filter between knowledge and economic knowledge” and argue that entrepreneurship is “the mechanism that reduces the knowledge filter”. As economists have begun to regard both innovation and entrepreneurship as the crucial determinants of economic growth, they still cannot find the way to account for individual differences. It is relevant to pull together the literatures on innovation, entrepreneurship, and public policy to understand their shared ideas and differences develop an integrative framework, as well as identify important research questions. The last section we will discuss the implication of this paper and propose future directions of research
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