Entrepreneurs are increasing the scope of Economic Activities:
Development does not simply mean ‘more’ and ‘better’ of the accessible, it also and further significantly means diversification of economic activities– diagonally the geographic, sectoral and technological scope. Entrepreneurship results in diversification of economic activities by creating employment, business opportunities, stabilizing the demand and supply factors as underdeveloped countries caught in the vicious cycle on the demand as well as supply side. Thus, it helps in overcome from this situation. GDP originates from industry and services increases.
You are aware that underdeveloped countries are caught in the cruel cycles on the demand as well as supply side. Entrepreneurs penetrate into and break these cycles, for example, by organizing and orienting domestic production for exports. Thus, production (and thereby generation of income) is not constrained by the inadequacy of domestic demand. (Demand-side Vicious Cycle). In today’s context, you are aware that India is poised to become a manufacturing hub for the global markets for diverse products.
New businesses need to hire employees. They create jobs and these economic opportunities uplift and support communities through increasing the quality of life and overall standard of living. Economic development is also constrained by the supply-side pressures resulting into absence of capacity to meet the demand whether domestic or overseas. Entrepreneurs mobilize local and even overseas resources to augment the productive capacity of a country. Entrepreneurs through their decisions to divest from the stale sectors and invest in green-field sectors bring about a virtual transformation of the economy from ‘underdeveloped’ to an ‘emerging’ and ‘developed’ status.