The costs of entrepreneurship

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Entrepreneurship is popularly regarded as an unmitigated boon that can solve a wide variety of organisational and economic problems while benefiting its practitioners. In contrast, this article provides a different perspective by drawing on a diverse body of theory to explore the costs of entrepreneurship. I propose two broad categories of costs: those that chiefly affect entrepreneurs themselves, and those that impact on society as a whole. Both types of cost can be monetary and non-monetary in nature. After categorising the most salient types of costs associated with entrepreneurship, I discuss various ways they might be mitigated, by entrepreneurs as well as third parties. A particular role is proposed for public policies, which may seek to: moderate entrepreneurial mismanagement based on over-optimism and dysfunctional business decision-making; strengthen intellectual property rights protection for university researchers and private-sector entrepreneurs; and curtail unproductive lobbying by powerful business interests, inter alia. Future researchers are challenged to develop further strategies to minimise the costs of entrepreneurship, while preserving their benefits.
Original languageEnglish
Pages (from-to)330-350
Number of pages21
JournalInternational Journal of Entrepreneurial Venturing
Volume4
Issue number4
DOIs
Publication statusPublished - Oct 2012

Keywords

  • management and business
  • entrepreneurship
  • innovation and SMEs
  • policy and organisational management

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