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- Title
Entrepreneurial Creation of Social Value: The Basement for Post-Crisis Recovery.
- Authors
Svirina, Anna
- Abstract
Global economic crisis started in 2007 had revealed two main problems which appeared and grew within pre-crisis period. The first one is lack of entrepreneurial activity which leads to decrease in workplaces and progress (high tech sphere or biotechnology growth seems to be an exception which only proves the rule) -- it can be easily seen from statistics analysis that there are only a few countries where entrepreneurial activity is growing while in the others even people with some entrepreneurial spirit prefer to become employees at big corporations. The second one is the misbalance in economic activities of real, financial and virtual sector enterprises. As far as statistics shows maximum profitability can be seen in banking (including investment banking) or virtual sector while both of them are in a certain way distributing tomorrow's payments into today's quickly achieved profits. Such attitude seem to suit shareholders who achieve extra income but is completely opposite to real entrepreneurial attitude since entrepreneurs are mainly concerned with making the world a better place to live instead of earning money quickly. Therefore the two stated problems are interrelated. This relation reveals the main problem of pre-crisis world which lead to global crisis: since social value produced by entrepreneurial units cannot be measured, it was considered unimportant and all the emphasis was put by entrepreneurs and especially hired managers into gaining profits as quick as possible (this can also be seen in economic models such as, for example, EVA model). This thesis is also proved by the research on corporate social responsibility or social entrepreneurship. Corporate social responsibility research is supposed to convince managers that being responsible can actually increase profits. Social entrepreneurship study sees social entrepreneurs as a special phenomena and is trying to figure out the reasons for social entrepreneurs' economics success. Both assumptions seem to be only a part of the truth. Analysis of successful entrepreneurial projects shows that they all were more or less social: almost all of the entrepreneurs had stated their main intention was to solve some problem of the society which as they believed (as well as their investors believed) could also bring them some income. Then if we take into consideration that all entrepreneurship is social it can lead us to the idea how to restructure the post-crisis world in order to increase entrepreneurial activity and pass the recession as soon as possible. This solution is partly based on Keynes's ideas of crisis management which were mainly based upon recognition that entrepreneurial activity should be increased by all means and partly based upon social value recognition. Currently there are only a few instruments for social value recognition if it is produced by entrepreneurs. One can mention tax exemptions imposed in case a company is doing charity and some relevant cases; in our opinion this is not enough. Regular entrepreneur who is trying to build long lasting business for example in the area of services is bound to receive lower profits than for example financial institutions producing derivatives. This means that an entrepreneur is going to attract less efficient
- Subjects
GLOBAL Financial Crisis, 2008-2009; ENTREPRENEURSHIP; BIOTECHNOLOGY; BUSINESSPEOPLE; STOCKHOLDERS
- Publication
Journal of Marketing Development & Competitiveness, 2012, Vol 6, Issue 3, p95
- ISSN
2155-2843
- Publication type
Article