IDEAS home Printed from https://ideas.repec.org/a/kap/iaecre/v20y2014i2p139-15010.1007-s11294-013-9456-6.html
   My bibliography  Save this article

Taking the Plunge: Teaching the Microeconomics of Entrepreneurship

Author

Listed:
  • William Stull

Abstract

Despite the importance of entrepreneurship in market economies, it is seldom given extensive coverage in undergraduate economics courses. Authors documenting its limited treatment in textbooks call for more in-depth, microtheoretic analyses that go beyond definitions and descriptions. The present paper represents an initial attempt to fill this gap in our pedagogy by describing a simple model of the entrepreneur “plunge” decision that is appropriate for intermediate microeconomics (and related) courses. The model, an extension of Scitovsky’s classic theory of the owner-managed firm, provides a formal analysis of the choice between paid employment and entrepreneurship that is based on utility maximization and takes into account the pecuniary and non-pecuniary benefits/costs of the two options. The intellectual origins and classroom presentation of the model are also discussed. Copyright International Atlantic Economic Society 2014

Suggested Citation

  • William Stull, 2014. "Taking the Plunge: Teaching the Microeconomics of Entrepreneurship," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 20(2), pages 139-150, May.
    • Handle: RePEc:kap:iaecre:v:20:y:2014:i:2:p:139-150:10.1007/s11294-013-9456-6
    DOI: 10.1007/s11294-013-9456-6
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11294-013-9456-6
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11294-013-9456-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Barbara J. Phipps & Robert J. Strom & William J. Baumol, 2012. "Principles of Economics Without the Prince of Denmark," The Journal of Economic Education, Taylor & Francis Journals, vol. 43(1), pages 58-71, January.
    2. Scharfstein, David S. & Gromb, Denis, 2002. "Entrepreneurship in Equilibrium," CEPR Discussion Papers 3652, C.E.P.R. Discussion Papers.
    3. repec:bla:jindec:v:50:y:2002:i:4:p:431-56 is not listed on IDEAS
    4. Carter, Nancy M. & Gartner, William B. & Shaver, Kelly G. & Gatewood, Elizabeth J., 2003. "The career reasons of nascent entrepreneurs," Journal of Business Venturing, Elsevier, vol. 18(1), pages 13-39, January.
    5. Sherwin Rosen, 1997. "Austrian and Neoclassical Economics: Any Gains from Trade?," Journal of Economic Perspectives, American Economic Association, vol. 11(4), pages 139-152, Fall.
    6. C. Praag & Peter Versloot, 2007. "What is the value of entrepreneurship? A review of recent research," Small Business Economics, Springer, vol. 29(4), pages 351-382, December.
    7. Calvin A. Kent & Francis W. Rushing, 1999. "Coverage of Entrepreneurship in Principles of Economics Textbooks: An Update," The Journal of Economic Education, Taylor & Francis Journals, vol. 30(2), pages 184-188, January.
    8. KruegerJR, Norris F. & Reilly, Michael D. & Carsrud, Alan L., 2000. "Competing models of entrepreneurial intentions," Journal of Business Venturing, Elsevier, vol. 15(5-6), pages 411-432.
    9. Arnold C. Cooper & William C. Dunkelberg, 1986. "Entrepreneurship and paths to business ownership," Strategic Management Journal, Wiley Blackwell, vol. 7(1), pages 53-68, January.
    10. Spulber,Daniel F., 2009. "The Theory of the Firm," Cambridge Books, Cambridge University Press, number 9780521736602, September.
    11. Blanchflower, David G & Oswald, Andrew J, 1998. "What Makes an Entrepreneur?," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 26-60, January.
    12. Reynolds, Paul D. & Curtin, Richard T., 2008. "Business Creation in the United States: Panel Study of Entrepreneurial Dynamics II Initial Assessment," Foundations and Trends(R) in Entrepreneurship, now publishers, vol. 4(3), pages 155-307, January.
    13. Tobias J. Moskowitz & Annette Vissing-Jørgensen, 2002. "The Returns to Entrepreneurial Investment: A Private Equity Premium Puzzle?," American Economic Review, American Economic Association, vol. 92(4), pages 745-778, September.
    14. Carrington, William J & McCue, Kristin & Pierce, Brooks, 1996. "The Role of Employer-Employee Interactions in Labor Market Cycles: Evidence from the Self-Employed," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 571-602, October.
    15. Dan Johansson, 2004. "Economics Without Entrepreneurship or Institutions: A Vocabulary Analysis of Graduate Textbooks," Econ Journal Watch, Econ Journal Watch, vol. 1(3), pages 515-538, December.
    16. Karen A. Campbell, 2009. "Entrepreneurial Behavior and the Development of Trading Institutions: An Analytical Approach," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 165(3), pages 487-507, September.
    17. Casson, Mark, 2005. "Entrepreneurship and the theory of the firm," Journal of Economic Behavior & Organization, Elsevier, vol. 58(2), pages 327-348, October.
    18. William J. Baumol, 2013. "The Microtheory of Innovative Entrepreneurship," Journal of Economic Sociology, National Research University Higher School of Economics, vol. 14(3), pages 96-108.
    19. Lapan, Harvey E. & Brown, Douglas M., 1988. "Utility Maximization, Individual Production and Market Equilibrium," Staff General Research Papers Archive 10815, Iowa State University, Department of Economics.
    20. Parker,Simon C., 2006. "The Economics of Self-Employment and Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521030632, January.
    21. Fiona M. Scott Morton & Joel M. Podolny, 2002. "Love or Money? The Effects of Owner Motivation in the California Wine Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 50(4), pages 431-456, December.
    22. William B. Gartner, 2001. "Is There an Elephant in Entrepreneurship? Blind Assumptions in Theory Development," Entrepreneurship Theory and Practice, , vol. 25(4), pages 27-39, July.
    23. Dunkelberg, William & Moore, Carmen & Scott, Jonathan & Stull, William, 2013. "Do entrepreneurial goals matter? Resource allocation in new owner-managed firms," Journal of Business Venturing, Elsevier, vol. 28(2), pages 225-240.
    24. Barton H. Hamilton, 2000. "Does Entrepreneurship Pay? An Empirical Analysis of the Returns to Self-Employment," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 604-631, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dunkelberg, William & Moore, Carmen & Scott, Jonathan & Stull, William, 2013. "Do entrepreneurial goals matter? Resource allocation in new owner-managed firms," Journal of Business Venturing, Elsevier, vol. 28(2), pages 225-240.
    2. William Dunkelberg & Carmen Moore & Jonathan Scott & William Stull, 2012. "Do Entrepreneurial Goals Matter? Resource Allocation in New Owner-Managed Firms," DETU Working Papers 1203, Department of Economics, Temple University.
    3. Milo Bianchi, 2012. "Financial Development, Entrepreneurship, and Job Satisfaction," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 273-286, February.
    4. Marco Caliendo & Alexander S. Kritikos & Claudia Stier, 2023. "The influence of start-up motivation on entrepreneurial performance," Small Business Economics, Springer, vol. 61(3), pages 869-889, October.
    5. Andrew Clark & Nathalie Colombier & David Masclet, 2008. "Never the same after the first time: the satisfaction of the second‐generation self‐employed," International Journal of Manpower, Emerald Group Publishing Limited, vol. 29(7), pages 591-609, November.
    6. repec:dau:papers:123456789/5067 is not listed on IDEAS
    7. McCann, Brian T. & Folta, Timothy B., 2012. "Entrepreneurial entry thresholds," Journal of Economic Behavior & Organization, Elsevier, vol. 84(3), pages 782-800.
    8. Hyytinen, Ari & Ruuskanen, Olli-Pekka, 2006. "What makes an entrepreneur independent? Evidence from time use survey," Discussion Papers 1029, The Research Institute of the Finnish Economy.
    9. Francesco Quatraro & Marco Vivarelli, 2015. "Drivers of Entrepreneurship and Post-entry Performance of Newborn Firms in Developing Countries," The World Bank Research Observer, World Bank, vol. 30(2), pages 277-305.
    10. Niklas Elert, 2014. "What determines entry? Evidence from Sweden," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(1), pages 55-92, August.
    11. Magnus Henrekson & Tino Sanandaji, 2011. "Entrepreneurship and the theory of taxation," Small Business Economics, Springer, vol. 37(2), pages 167-185, September.
    12. Kunwon Ahn & John V. Winters, 2023. "Does education enhance entrepreneurship?," Small Business Economics, Springer, vol. 61(2), pages 717-743, August.
    13. Márton Gosztonyi & Csákné Filep Judit, 2022. "Profiling (Non-)Nascent Entrepreneurs in Hungary Based on Machine Learning Approaches," Sustainability, MDPI, vol. 14(6), pages 1-20, March.
    14. P. Mueller, 2006. "Entrepreneurship in the Region: Breeding Ground for Nascent Entrepreneurs?," Small Business Economics, Springer, vol. 27(1), pages 41-58, August.
    15. Milo Bianchi & Magnus Henrekson, 2005. "Is Neoclassical Economics still Entrepreneurless?," Kyklos, Wiley Blackwell, vol. 58(3), pages 353-377, July.
    16. Benjamin A. Campbell, 2013. "Earnings Effects of Entrepreneurial Experience: Evidence from the Semiconductor Industry," Management Science, INFORMS, vol. 59(2), pages 286-304, February.
    17. Ramana Nanda, 2008. "Cost of External Finance and Selection into Entrepreneurship," Harvard Business School Working Papers 08-047, Harvard Business School.
    18. Martin Binder, 2017. "Entrepreneurial Success and Subjective Well-Being: Worries about the Business Explain One's Well-Being Loss from Self-Employment," SOEPpapers on Multidisciplinary Panel Data Research 947, DIW Berlin, The German Socio-Economic Panel (SOEP).
    19. C. Praag & Peter Versloot, 2007. "What is the value of entrepreneurship? A review of recent research," Small Business Economics, Springer, vol. 29(4), pages 351-382, December.
    20. Backes-Gellner, Uschi & Moog, Petra, 2013. "The disposition to become an entrepreneur and the jacks-of-all-trades in social and human capital," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 47(C), pages 55-72.
    21. Manju Puri & David T. Robinson, 2013. "The Economic Psychology of Entrepreneurship and Family Business," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 22(2), pages 423-444, June.

    More about this item

    Keywords

    Teaching of Economics; Entrepreneurship; Economic Education; JEL Classification; A22; L26;
    All these keywords.

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:iaecre:v:20:y:2014:i:2:p:139-150:10.1007/s11294-013-9456-6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.