Is Neoclassical Economics still Entrepreneurless?

Milo Bianchi () and Magnus Henrekson ()

No 584, Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: We review and evaluate some recent contributions on the modeling of entrepreneurship within a neoclassical framework, analyzing how and to what extent the fundamental ingredients suggested in the social science literature were captured. We show how these approaches are important in stressing the main elements of a complex picture without being able to completely describe it. However, each modeling attempt focuses only on one specific feature of entrepreneurship. The entrepreneurial function broadly perceived eludes analytical tractability. As a consequence, the models can be useful in analyzing the effect of entrepreneurial behavior at an aggregate level, but not at explaining individual choices. From these observations we highlight how a simplistic interpretation of the existing mainstream approaches incorporating entrepreneurship runs the risk of leading to distortionary policy interventions.

Keywords: Entrepreneurial Choice; Entrepreneurship; Innovation; Neoclassical Modeling; Uncertainty (search for similar items in EconPapers)
JEL-codes: B41 D81 J23 L23 M13 O31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ent, nep-his, nep-hpe, nep-mic and nep-pke
Date: 2005-01-31, Revised 2005-03-29
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Published in Kyklos, 2005, pages 353-377.

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Journal Article: Is Neoclassical Economics still Entrepreneurless? (2005)
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Persistent link: http://EconPapers.repec.org/RePEc:hhs:hastef:0584

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