Business effects

1. Entrepreneur offers a new product/service
(P/S) is offered (something with a higher
price value combination)
Newness is the satisfaction of at least
one (of the seven) criteria mentioned
in Schumpeter's full model of
entrepreneurship (Swedberg, 2008) 1
Can be offered through a new
venture (e.g. micro enterprise) or
established firms
P/S is perceived as a
less/equally efficient
solution to those offered
in the market

2. Newness is the satisfaction of
at least one (of the seven)
criteria mentioned in
Schumpeter's full model of
entrepreneurship (Swedberg,
2008) 1
Can be offered through a
new venture (e.g. micro
enterprise) or established
firms
P/S is perceived as a more efficient solution to those offered in the market
P/S is perceived as a less/equally efficient
solution to those offered in the market
Entrepreneur fails to make profit. P/S
is withdrawn
Entrepreneur makes profit. Venture expands and market share increases
Other businessmen try to replicate the new
P/S.
The economy starts to move to higher efficiency (more value created
in fewer resources)
New P/S eliminates old substitutes in the market. Economy stabilizes at the higher level of
efficiency. More sources of production are available in the economy. Consumers have
more disposal income to spend from.
Entrepreneur offers a new product/service
(P/S) is offered (something with a higher price
value combination)

3. New P/S eliminates old substitutes in the market.
P/S is perceived as a less/equally efficient
solution to those offered in the market
P/S is perceived as a less/equally efficient
solution to those offered in the market
P/S is perceived as a less/equally efficient
solution to those offered in the market
P/S is perceived as a less/equally efficient
solution to those offered in the market
Economy stabilizes at the higher level of efficiency.
More sources of production are available in the economy
Consumers have more disposal income to spend from.
P/S is perceived as a less/equally efficient
solution to those offered in the market