What Managers Need To Know About The History Of Entrepreneurship?

Hi. How are you doing today? welcome to
another video at SQUARE ONE CHALLENGE. We discussed in our previous video that
entrepreneurship is the most important driver of the global economy and what
methodological approaches have been taken in defining entrepreneurship. in
this video we’ll take you through the evolutionary journey of entrepreneurship
its emergence and acceptance in the early civilizations and the emanation of
the modern form of entrepreneurship . This video will provide you with the
historical information that is pertinent to managers in today’s economy. Do You Know that the historical evidence suggest that the Islamic civilization was one of the earliest civilizations that accepted and flourished and entrepreneurial activity as compared to the Roman civilization? Do you also know that in Europe the role of entrepreneur was once associated with negative connotations
such as greed exploitation selfishness and disloyalty? Yes, it’s true. It’s true that it was after the 18th century in Europe that the role of entrepreneur
began to be recognized as the driving force of the economy and a very positive
contributing member of the society SQUARE ONE CHALLENGE aims to provide your FREE education on entrepreneurship so that you can create successful
enterprises that port scalable and saleable. We may think that the concept of
entrepreneurship is a new one and belongs to the modern world but the
history of entrepreneurship actually goes back to 20,000 and 30,000 years. In
various academic or business writings you may find that the historical
evolution of entrepreneurship has been broken down into various stages by
different authors but to make it short I will elaborate them into the following
three eras the earliest period the Middle Ages and the modern period. Here I will only be giving a brief summary on the emergence of a entrepreneurship in
the earliest period and how it flourished through the Middle Ages However, if you’re someone who is
interested in going deep down into the history of entrepreneurship Joe Carlen’s
book a brief history of entrepreneurship on the pioneers profiteers and racketeer
who shaped our world explains a great deal about the historical evolution of entrepreneurship if you are an entrepreneur who is fond of history. In
fact, every entrepreneur should know about the historical development of
entrepreneurship and also if you want to know how improvements in doing
businesses contributed to the economic development from the earliest form of
entrepreneurship till the modern one I highly recommend you read this book so
in this video I will only shed a light on the earliest history of
entrepreneurship as most of the content of this video is more focused towards
the business management element of entrepreneurship The historical evidence of
entrepreneurship that dates back to Upper Paleolithic period and the end of
Stone Age where we see the emergence of entrepreneurial tribes who innovated new
methods for hunting in agriculture. They were more sedentary tribes who didn’t want to go too far away places for hunting so they started farming cattle
and later on learned to grow their own crops and then they gradually innovated
on methods to improve their living standards. The earliest archaeological
evidence indicates that entrepreneurship flourished most in the Mesopotamia
civilization the civilization in which the Egyptians Sumerian cities and the
city of Babylon was formed. It is during this period that the entrepreneurial class
of the venturesome merchants entrepreneurs emerged who were also
known as the enterprising tradesmen while Mesopotamian and Phoenicians
provided positive environments for Entrepreneurship however not all
civilization foster entrepreneurship one such example is the Roman civilization
who were reluctant to in Juvenal activity they inhibited the idea of
creating new things and rather created wealth through the spoils of war In the early 7th century the Islamic
civilization fostered many great acts of entrepreneurship in fact Islam itself
promotes the idea of entrepreneurial endeavors a famous verse from Quran that
is often quoted by Muslim economists encourages Muslims to indulge in
entrepreneurial activity in fact it’s one of the many words in Quran that promotes
its believers to seek paths of business endeavors to place Allah Prophet
Muhammad (Peace be Upon Him) also set a great example of transforming the
social political and military actions over the course of centuries muslim laws
rules practices standards belief systems and reward mechanisms transformed their
societies and the major reason for this was that muslim jurists or policy makers
or caliphs who incorporated these practices in Islamic law and refined
them repeatedly were businessmen who were mostly into the trading businesses
for the passage of time Muslim traders pollinated the soil of Middle East and
Asia with their entrepreneurial innovativeness such as use of trading
contracts introduction of arithmetic simplified accounting methods use of
Arabic numerical such as zero and the widespread use of paper. In academic
texts these Muslim traders are known as influential pollinators of
entrepreneurship who transplanted institutions across regions organize
commercial trips with highly uncertain outcomes build commercial links with
unknown territories established new markets and introduce people to new
commodities but the middle of second millennium Middle Easterners were
playing a secondary role in the expansion of global commerce and by the
half millenium middle Easterns were playing no leading role in the early
modern phase of institutional development that led to
industrialization here the question arises that if
Islam promotes hardwork risk-taking and innovation
then why the most innovating and entrepreneurial countries of this time are
not Muslims? Leading Muslim reformers of 19th century emphasized the formal
notion of Islam that is the perverted form of Islam which council passive
resignation to the flow of evens counteract with the authentic Islam
which holds the individual responsible for its acts including his failures and
requires the active use of God-given talents. Another belief (is) that Islamic
institutions that served innovators became dysfunctional as the Islamic law
failed to stimulate the development of organizational forms of resource
acquisition and management on a larger scale the importance of Islamic entrepreneurial history in laying the foundation of modern form of
entrepreneurship is evident from various academic texts yet very few names of
successful entrepreneurs of early Islamic civilization can be found in
historical archives the reason for this is the lack of record-keeping and
archiving or preserving of documents from generations after generations that
could have assisted later generations of owners and managers it was during the 18th century that the
term and Entrepreneurship was first established by an Irish French economist
Richard Cantillon he was the first person to introduce the
term entrepreneur in the economic theory the word entrepreneur is derived from a
French root which means to undertake and this undertaking is described as the
adventurous actions of a person developing a business opportunity or
enterprise later jean-baptiste say first described the function of entrepreneur
as someone who bears the risk and whose success depends upon their ability to
judge future demands and profits in 19th century Leon Warlas argued that
entrepreneur is someone who brings equilibrium to the production in such a
way that the profit is maximized afterwards
Frank Knight proposed a model where he describes entrepreneur as someone who
takes risks by making decisions in an uncertain environment in this model of
uncertainty entrepreneur uses his skills in judgment and knowledge foresight
confidence in his own judgments and capacity for leadership sham Peter both
first economists who theorized the idea of entrepreneurship
he viewed entrepreneurs as wild spirits was drive for innovation and improvement
creates upheaval and change he proposed the theory of creative destruction and
explained it as a process of continuous industrial mutation that continually
destroyed the old structures and creates a new one the entrepreneur carries out
new innovation thereby rendering all industries obsolete established ways of
doing businesses are destroyed by the creation of new and better ways to do
them David McClelland defined the concept of entrepreneurial function and
described entrepreneurs as high achieving individuals who have an innate
desire for taking responsibility of their own decisions that involves a
moderate to high degree of risk and they have interest in getting knowledge on
the results of their decision Peter Drucker
took this idea further and argues that an entrepreneur is someone who actually
searches for change response to it and exploit change as an opportunity
entrepreneurs excel at seeing and taking advantage of possibilities created by
social technological and cultural changes Paul Davidson Reynolds was a
renowned researcher and the recipient of the annual Swedish international award
for entrepreneurship and small businesses research in 2004 and in 2012
he received the dedication to entrepreneurship research award from the
Academy of Management entrepreneurship division his research proposed the do’s
and don’ts of the startup processes he viewed entrepreneurship as the entrepreneurial
function that can be conceptualized as the discovery of opportunities and the
subsequent creation of new accom activity often via the creation of a new

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Reader Comments

  1. Square One Challenge

    Watch the full playlist on the Fundamentals of Entrepreneurship: https://www.youtube.com/playlist?list=PLcWhuKZmqpAXBzbIdZNvN6LaXeFcQ9bDH

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