Section 2 from the:
The Concise Guide To Economics
by Jim Cox
Entrepreneurship is risking valuable resources. What is done and what could be done?
Acting on perceived opportunities in the market in an
attempt to gain profits.
This acting involves being alert to profit resources and
seeing a project through to completion.
Entrepreneurs can be regarded as heroic characters in the
new goods and services
to the consumer. To quote from Ludwig vonMises in
Human Action : They are the leaders
on the way to material progress. They are the first to understand that there is a discrepancy
between what is done and what could be done. They guess what the consumers would like
to have and are intent on providing them with these things. p. 336
Entrepreneurship is an art, every bit as much as creating a painting or
sculpture. In each case--running a business and producing a work of art--the
same elements abound: Conceiving the undertaking, taking resources and
combining them into something new and different, risking those valuable
resources in producing something which may ultimately prove to be of less
It is very common in economics textbooks to ignore the entrepreneur when
the texts discuss markets and competition. Their treatment implies that this
alertness to profit possibilities, arrangement of financing, management of
resources and seeing a project through to completion are all automatic
within the market economy. They are not. Real flesh and blood people must
act (and not once, but continuously), and be motivated to take these risks in
order for commerce to proceed.