Entrepreneurship

Entrepreneurship is a social process that aims to create an organization—a new business—in pursuit of a business opportunity. Someone who perceives a business opportunity and assumes the risk of creating such an organization is an entrepreneur. Although entrepreneurship is usually considered from the perspective of the individual entrepreneur, and while individual volition and motivation should not be discounted, entrepreneurial decisions and actions are often most meaningful in light of their social context—the local community. This community includes other organizations and institutions that can provide resources to facilitate the process but can also pose obstacles that impede or arrest its realization. Local attitudes, values, and norms about change and innovation also affect an individual's willingness to assume the risk of embarking on a novel business venture.

Communities vary in the degree to which the local social structure and culture support change and innovation and accept individuals who fail in attempting risky ventures. Communities also vary in the presence of the necessary social, economic, and physical infrastructure that new ventures require in their early incubation stages.

One of several strategies available for community economic development—creating jobs and income for the local population—entrepreneurship has advantages over the traditional and still predominant strategy of business and industry recruitment, sometimes called smokestack chasing. Recruited businesses may demand financial incentives and regulatory concessions to set up business, and they may close shop with little notice and move elsewhere if presented with a better situation. Local entrepreneurs, on the other hand, generally have a community commitment that is reinforced through local assistance. Assisting and nurturing local entrepreneurial ventures, therefore, is a self-development strategy that offers great potential for improving local economic vitality. Self-development strategies involve the efforts of local organizations and include a substantial investment of local resources, and the resulting enterprises are locally controlled.