TITLE:
A Theory of Entrepreneurial Work
AUTHORS:
Ying Lowrey, Danxia Xie
KEYWORDS:
Entrepreneur, Work Ethic, Labor, Entrepreneurial Work
JOURNAL NAME:
Theoretical Economics Letters,
Vol.9 No.5,
June
20,
2019
ABSTRACT: This research is inspired by Baumol’s lifetime
effort in introducing the entrepreneur to mainstream economics. The paper
examines entrepreneurial work and suggests a return to classical economic
theory of the entrepreneur in the tradition of Max Weber and Joseph Schumpeter.
We assume entrepreneurial work to be the
intrinsic character of the entrepreneur, who divides her working time into
subsistence and entrepreneurial productions. The entrepreneur taking pleasure
from entrepreneurial work is the crucial conjecture of our analytical model.
The model predicts 1) maximum utility can be reached if and only if the market
value of the marginal product of labor in subsistence production is greater
than that in entrepreneurial production; 2) government interventions
artificially alternating the price of subsistent production may lead to
misallocation of limited labor time into the two productions.