This chapter deals with the concept and theories of entrepreneurship that can be defined as the type of business strategy focused on the creation of new business ideas, jobs, social wealth, and profit by optimizing the use of productive and commercial resources. Neoclassical and new Keynesian theories are briefly analyzed in the chapter, as well as psychological-based and modern theories, including the jack-of-all trades theory, o-ring theory, resources- and capabilities-based theory, and theory of the optimal triangle. The chapter finishes with the necessity of also including both social and solidarity-based entrepreneurship strategies, alongside the traditional classification made on this concept.
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In today's world, have a good number of active entrepreneurs is key to determining good corporate health of a country. Entrepreneurs discover and exploit new business opportunities guided by intuition (Saiz-Alvarez, Coduras, & Cuervo-Arango, 2013) and risk control, while motivating social change. Complementary to entrepreneurs, capitalists only invest their money searching for share profitability, and managers, as decision-makers, foster mainly first-order competitive advantages in the company (R&D and innovation) by enhancing competition (Cuervo, Ribeiro, & Roig, 2007). When competition is strong, firms are achieving continuous improvements over time, which benefits their stakeholders.
Contrary to Van Praag and Van Ophem (1995), who affirm entrepreneurship was first studied in Cantillon’s Essai sur la nature du commerce en général, published in 1755, the concept of entrepreneur (in the sense of merchant) was first studied in Spain in the second book of Tomás de Mercado’s Tratos y contratos de mercaderes y tratantes discididos y determinados [Deals and Contracts Applied to Certain Merchants and Traders], published in 1569, and reedited with a few tweaks in 1571, as Suma de tratos y contratos [Treaty on Deals and Contracts]. Regarding entrepreneurship, Tomás de Mercado approves new business and exchange trade, only if they are consistent with the moral rules based on not taking advantage of others by using abusive prices and interest rates, or by conducting unfair agreements, both socially and economically.
This connection between moral acts and entrepreneurship continues, with exceptions, until today. In fact, entrepreneurs must be involved in the study of sources for discovering, and achieving new business opportunities, in order to exploit them (Shane and Venkataraman, 2000). As a result, and given the impact of entrepreneurship in a country, «contemporary economic theory recognizes entrepreneurship as an independent factor of production on a more-or-less equal footing with land, labor, and capital» (Hébert and Link, 1989, p. 40). The objective of this work is to define entrepreneurship, and the classical and new theories of entrepreneurship, both from economic and psychological perspectives.