Entrepreneurship and Answers for the Economy

EnergyThe Jan/Feb issue of Foreign Affairs has a focus on the state of “entrepreneurialism.”  The special portions of the magazine generally follow from the work of Schumpeter and his emphasis on the importance of entrepreneurs to the economy and of his oft-quoted notion about “creative destruction.”  The magazine interviewed a number of prominent technology entrepreneurs and related professionals (like investors), interviewing each to try to gain their collective perspective on technology, innovation, entrepreneurship, and the role of the state in promoting those things.  The individual interviews are somewhat interesting to read, but I think the more interesting outcome are the patterns of thinking that emerge from the group.

For instance, I liked their thoughts on what makes a good entrepreneur (perseverance, timing, innovation).  Mostly they readily speak to their failed attempts and their various misreadings of opportunities in the market over the last 20 years.  And on this issue they seem to share a fairly consistent view of the qualities that help those aspiring to create companies.

Their thoughts on the role of entrepreneurship in the wider economy are positive (as to be expected).  They don’t really see entrepreneurs as heroes, but they do generally see them as critical to progress and innovation.

Where I was not so enamored of their responses was to the issue of the creative destruction that technology innovators can often have and the resulting dislocation of workers.  For the most part they acknowledge it and to some extent lament its very real human impact, but as a whole this group of tech innovators lack any coherent or comprehensive answer to the issue.  Coming as they do from the business side of this issue, being the disruptive innovators themselves, one is not surprised by this.  But it’s still disappointing to get answers along the lines of “this is why the state should do better in education.”  The most progressive answer came from the robotics entrepreneur who opined that it would be nice to see redistributing the productivity gains from robots and automation to reduce the workweek to 4 or even 3 days.

Given the growing conversation about automation and incipient industrial revolutions, I don’t think concern about large scale labor dislocation is unwarranted.  Certainly this is an area where it would have been interesting to delve into deeper.

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