Can Entrepreneurship Be “Unproductive?” Towards An Evolutionary Interpretation

Can entrepreneurship ever be unproductive? This provocative question admits of many answers, generally depending upon defini? tional, theoretical and methodological groundings. The preconceptions of nineteenth century classical liberalism would appear to answer the question with a resounding no. When the entrepreneur was considered at all in this scenario, he or she was presented as the hero of the piece. It is well-known, additionally, that as classical economics became neoclassical economic theory, the equilibrating and positivistic mold into which economics was cast virtually eliminated a role for the entrepreneur. Modern theories of rent seeking cast the entrepreneur as a somewhat sinister character. Overt criticism of the entrepreneurial role in rent seeking as unproductive has, in fact, appeared in recent literature (Baumol, 1990). The purpose of this paper is to explore the notion of entrepreneurial productivity from the perspective of economic method and anecdotal (historical) evidence. Specifically, we will argue that so-called productivity of entrepreneurial action pivots critically on conceptions of competition and markets and on the applicability of Pareto Optimality to such arguments. We advance, after theoretical and historical investigation, a generalized Schumpeterian-modern Austrian interpretation of entrepreneurship as an evolutionary value-creating activity, albeit with the inclusion of economizing elements. By

Action (physics) · Austrian School · Coase theorem · Competition (biology) · Criticism · Economics · Entrepreneurship · Epistemology · Interpretation (philosophy) · Microeconomics · Mill · Neoclassical economics · Political science · Positive economics · Positivism · Productivity · Sociology · Transaction cost · Value (mathematics) · Economic theories and models · Economic Theory and Institutions · Law · Merger and Competition Analysis · Philosophy

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