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Schumpeterian Entrepreneurship: Coveted by Policymakers but Impervious to Top-Down Policymaking

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  • Henrekson, Magnus

    (Research Institute of Industrial Economics (IFN))

  • Kärnä, Anders

    (Research Institute of Industrial Economics (IFN))

  • Sanandaji, Tino

    (Institute for Economic and Business History Research)

Abstract

Differentiating various types of entrepreneurs provides clues to the puzzle of why top-down policies often fail to create Schumpeterian entrepreneurship and the ecosystems where it thrives. Schumpeterian entrepreneurship is intrinsically contrarian, whereas public policy has a bias toward incremental innovation and replication of past success. If central planners knew what the next radical innovation would be, there would be no need for Schumpeterian entrepreneurs. Schumpeterian entrepreneurs create not only companies but also institutions in the entrepreneurial support system. These ever-evolving structures are too complex to design, and central planning instead reduces the space for organic institutional innovation.

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  • Henrekson, Magnus & Kärnä, Anders & Sanandaji, Tino, 2021. "Schumpeterian Entrepreneurship: Coveted by Policymakers but Impervious to Top-Down Policymaking," Working Paper Series 1395, Research Institute of Industrial Economics, revised 31 Jan 2022.
    • Handle: RePEc:hhs:iuiwop:1395
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    More about this item

    Keywords

    Entrepreneurship policy; High-impact entrepreneurship; Innovation; Institutions; Schumpeterian entrepreneurship;
    All these keywords.

    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights

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