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How Does Entrepreneurship Affects To The National Economy?

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Connor Sephton answered
The role of entrepreneurship in the national economy is an important one; without the ideas and ventures of entrepreneurs, new businesses would not emerge.

Entrepreneurs are visionaries who imagine new firms and companies, and then work hard to make their dreams a reality. Since most countries have hundreds of thousands of small businesses (some of which grow and expand to become very powerful and lucrative), national economies are reliant on the tax dollars and jobs generated by small business.

Sometimes, when the economy takes a hit (recessions are examples of serious economic downturns), entrepreneurs are affected. Less consumerism and more cautious buying patterns lead to disaster for many small and medium-sized businesses.

In some cases, governments will put together stimulus payments or other incentives that make it easier for entrepreneurs to survive a recession; governments will act because they know how much entrepreneurs contribute to the entire national economy.   

  • Entrepreneurship strengthens the national economy
Without entrepreneurship, big businesses and multinational companies will control too much of the marketplace. When giant companies are in control of many market segments, the situation may lead to monopolies. Monopolies give too much control to just a few firms; a national economy will be healthier and more diverse when entrepreneurship is valued and vibrant.

Trade associations are used to foster camaraderie between small business people as they seek out their dreams; they work together to create a system of networking and cross-promotion.

The government may offer tax incentives and other spurs to create a welcoming, profitable atmosphere for new and experienced entrepreneurs. All government incentives are used to create more action and more money making within the national economy.

Entrepreneurs strengthen the national economy through efforts in many different spheres of industry, including travel and hospitality, high-tech, retail and much more. Each industry sub-segment is always represented by a group of dedicated and innovative entrepreneurs.

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