In my sentiment, productive enterpriser is a individual who set up a concern with merchandises which is good for the society and besides helps to increase the economic degree of the state ( e.g. turn the GDP degree ) .
For illustration, Richard Reed and his friends found a concern called Innocent, which sells fruit smoothy, juices and veggies & A ; fruits pot. They merchandises use 100 % fresh fruits, natural and healthy, so they merchandises are good for the human organic structure and good for the society. They besides designed the fruit towers which use green energy to run, once more, it is socially friendly and environmental friendly. They concern besides helps the GDP growing, as they concern can sell more than 2 million drinks every hebdomad and that tells us that it help to turn the productiveness of the whole state besides help to increase the purchase activity growing in the market and those can assist the state ‘s GDP growing. Harmonizing to those groundss, Innocent Company is socially friendly and supports the GDP growing. Therefore we can state Innocent is productive company and Richard Reed and his friends are productive enterprisers.
In contrast with the productive enterpriser, unproductive enterpriser is a individual addition net income through rent seeking or other assorted signifier of corruptness which is harmful to the society and besides impedes or non assist the economic growing.
For case, people who rent droping with the parking infinite. As Hong Kong Government carried out a new policy to command the lifting lodging monetary values, nevertheless this policy is merely for the lodging monetary value but non the other non-tenement belongings, hence the parking infinite is the new favourite for those rent seeking people. Harmonizing to the intelligence, one land agent has 514 parking infinites for puting sold to the families ; some families who do non necessitate a parking infinite still go to to the draw, because as they get a parking infinite, so they can lift the parking infinite monetary value by $ 20 1000s to $ 30 1000s and resell it to the other families who in demand. By making this, they can derive net income for their ain from the monetary value difference. Some families may utilize higher monetary value to bride the parking infinite proprietors, so as he got the parking infinite, he will resell it with a higher monetary value to derive a markup. Those activities decidedly is unproductive, and those people who did it, are unproductive enterprisers, as they use the limited allowance to originate the monetary value of the parking infinites to derive their money by destructing the market regulation and their additions will non flux out to the economic system but shop into their ain public assistance, so this will cut down the money flow in the economic system, cut down the economic growing. It is besides harmful to those people who truly in demand, hence this sort of rent seeking will convey a negative impact to the society ; once more, it shows that they are the unproductive enterpriser.
Q2 Answer: Explain whether or non he/she is a Kirzner type of enterpriser or a Schumpeter type. Why?
To my point of positions, the Schumpeter type of enterpriser demands to suit into three phases, foremost is make a new merchandise or make a new manner to treat a merchandise, secondly, the invention has created devastation in the market or industry and the last is disequilibrium in the economic system.
Maxwell Bogue and Peter Dilworth are the laminitiss of Wobble Works LLC. In December, 2012, they launched a merchandise called 3D Doodler, which is a 3D pen, usage ABS plastic as the ink of the pen and you can utilize this 3D pen non merely pull the image on a piece of paper but besides off the paper. This is the first 3D pen in the universe, and it creates a new manner for the creative person to show their imaginativenesss. It does make certain degree of devastation to the 2D pen industry, and the industry that industry ornament and graphics, because people can utilize this pen to do their ain ornament for their office or house. The jewellery industry may be besides destructing, as people besides can do their ain jewellery at place with this 3D pen. This invention can bear down high monetary value in the market, and make disequilibrium in the economic system as it is the merely and foremost 3D pen, which has monopoly power in the market. Harmonizing to those groundss, it can turn out that Maxwell Bogue and Peter Dilworth are Schumpeter type of enterpriser as they fit to the three of import phases of Schumpeter.
In my head, the Kirzner type of enterpriser is the enterpriser who buys low stuffs or merchandises so sell it in a much higher monetary value to consumers and their merely utilize the exist information in the market than make new information from the exterior. The illustration I will utilize to demo the Kirzner of enterpriser is the Li & A ; Fung Ltd. , which is a celebrated planetary trading company in Hong Kong.
Fung Pak-liu and Li To-ming are the laminitiss of Li & A ; Fung Company. 1906, Li & A ; Fung is the first foreign export trade concern found by the Chinese. At the beginning, they concern based in Guangzhou, as Guangzhou had cheaper work forces and cheaper stuff to bring forth the merchandises like silk, Jade handicrafts and so away, so they exported those merchandises to United States in a higher monetary value and got the benefit between the monetary value difference. Subsequently on as they found Hong Kong has a deep-sea seaport which is better support the concern ‘s trade ; they set up an integrated house in Hong Kong controlled by Fung Hon-chu ( Fung ‘s boy ) . After 1949, immense among of people immigrated to Hong Kong which brought a flow of work forces. It means there were a immense cut of pay costs and Fung Hon-chu used this as the benefit to do a lower fabrication cost and mass of productivenesss. As the cost lower, so the spread between the fabrication cost and the merchandising monetary value will be bigger and brought immense net income earned to Li & A ; Fung. Therefore, evidently, Harmonizing to the first 100 old ages of Li & A ; Fung ‘s net income earning procedure, Fung Pak-liu, Li To-ming and Fung Hon-chu are Kirzner type of enterprisers, as they gain net income through the “ purchase low sell high ” method and they have non make new merchandises or introduce new manner to bring forth a merchandise by utilizing new information or thought outside the market but utilizing the exist information such as the low work forces and stuff costs and the location advantage as the benefit for the concern growing.
Q3 Answer: Can at that place be possible negative effects to productive entrepreneurship? ( Hint: believe about the unnoticed stakeholders and the long term effects. You should be able to reply in what sense is it negative, to whom is it negatively impacting, what is the clip frame of this impact, and how much of a negative impact ) .
I agree that productive entrepreneurship can hold negative effects.
For case, the Facebook that found by Mark Zuckerberg. As the Facebook set up, 100s and 1000s of people opened an history and start to utilize Facebook as a platform to reach and maintain the relationship with their friends. By utilizing Facebook, people can do tonss of new friends that with same involvement and avocations, so it can convey felicity to people through the cyberspace. They besides can post their ain exposures or pictures on the Facebook to portion with their friends enable their friends to cognize more about themselves. Therefore, Facebook have societal benefits for the society. As many people are utilizing Facebook, many companies will utilize Facebook as a platform for advancing their merchandises or the activities the companies will keep in these yearss, Thus, Facebook can assist the companies to pull more clients to purchase the merchandises which will assist to increase the economic activities in the economic system and this may assist the state to hold higher economic degree. Consequently, the Facebook is an illustration for productive entrepreneurship, as it helps to develop the economic system and benefit to the society.
However, there are some negative impacts of Facebook through the twenty-four hours by twenty-four hours utilizing. First, people started to additive with the Facebook, some serious users need to pass more than 10 hours per twenty-four hours on the Facebook without utilizing those hours to make more productive activities. If more and more people become linear, so more people will good utilize the clip and will convey a bad impact to the productiveness and will take a slow or down grow of economic system. Second, it has security issue. The Facebook is established in the cyberspace, so it is harder to command or work out all the security issues, such as hacking, as the Facebook can non command what people will make and speak online so is difficult to avoid this happen. Besides there is no barrier when open an history in Facebook, so every type of people can utilize it, and this will convey the danger into the Facebook group every bit good. Furthermore, as people utilizing more clip on the on-line communicating, they may be lost the ability to pass on to the others face to confront as they can show themselves in the Facebook than in the existent life, particularly the self-doubt people, so this will convey a societal job to the society.
Therefore, even though a productive entrepreneurship besides will convey a negative consequence to the economic system or the society. The negative impacts may non be occurred instantly, by during a long period, the negative will look due to the users ‘ action and the societal value at that period.