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Dark Side of Entrepreneurship

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Submitted By romans101
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Entrepreneurship and Small Business Element CW/1 Individual Essay

‘Entrepreneurship is said to benefit society in many ways, however there is also said to be a dark side to entrepreneurship. Drawing on academic literature, consider the downsides of entrepreneurship.’

Introduction

Entrepreneurship is portrayed by society and media as a positive concept, often praised for the creation of jobs and innovation. Individual entrepreneurs, such as Steve Jobs and Richard Branson, are idolized and perceived as enthusiastic and ambitious individuals.

However not everything is as positive as it seems. In recent years, there has been a vast emergence of academic literature based around the ‘dark side’ of entrepreneurship, a concept that was first explored and introduced by Baumol (1990). Baumol introduced a different approach to the widely accepted Schumpeterian model of entrepreneurship, where he suggested that entrepreneurship could be unproductive and even destructive. This essay will discuss and evaluate the literature of the ‘dark side’ of entrepreneurship.

Individual Psychological Factors

The ‘dark side’ of entrepreneurship has been thoroughly investigated by a range of academics, and is discussed in many pieces of literature. A key area of focus in these seems to be the psychological factors that entrepreneurs possess as individuals, and how these factors can create all sorts of problems.

Entrepreneurs are often portrayed as creative, ambitious and enthusiastic individuals with an inner passion and drive for success. Lockwood et al (2006) indicate that entrepreneurs are characterized as confident, optimistic, independent and self-reliant individuals. However, Hickman (1998) suggests that the behaviors that distinguish entrepreneurs also have potential to cause problematic or even disastrous outcomes for their organizations. She suggests that due to

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