On the Role of the Innovative Entrepreneur in the Prosperity - and Decline - of Three Historical Economies
3 Pages Posted: 8 Feb 2010 Last revised: 10 Feb 2010
Date Written: February 8, 2010
Three historical papers on the influence of the innovative entrepreneur upon the achievements of their economies were presented at the annual meeting of the ASSA held in Atlanta in January 2010. The focus of the session was on the incentive structure built into the institutions of the three economies investigated, each of which had experienced an era of extraordinary economic accomplishment, followed by a period of marked decline.
Of course, the causes of these developments were complex - no single influence can be expected to provide the sole explanation. Yet, in each case, the evidence indicates that each economy’s pertinent institutions initially provided strong incentives that led individuals with enterprising propensities and abilities to devote themselves to the promotion of innovations that were beneficial to their economies, rather than pursuing activities that promised private gains at the expense of the general welfare. The historical evidence cited in each paper comports with the hypothesis offered by leading economic historians, which asserts that the activities undertaken by entrepreneurs are influenced heavily by the institutions present in their economies, which provide the incentives that determine the activities to which entrepreneurs choose to allocate their efforts.
The papers in this ASSA session examined evidence related to this hypothesis that indicates that the incentives, at least at the end of each economy’s prosperous periods, were such as to attract entrepreneurs away from the productive innovative activities in which these societies had achieved much success and prosperity. These studies offer important lessons for today’s impoverished economies, as well as for wealthy economies whose continued prosperity seems uncertain.
Keywords: Economic History, Entrepreneurship
JEL Classification: N, N9
Suggested Citation: Suggested Citation