Promotional Information

Even as innovative entrepreneurship has emerged as the goal for policymakers around the globe, economists have struggled to find its proper place in microtheory. No more. In this pathbreaking new book, William Baumol provides the blueprint for understanding the crucial role of entrepreneurship and its contribution to innovation and ultimately economic growth. This lively and thoughtful book highlights the distinct role entrepreneurs play in the economy and reveals why the entrepreneur can no longer remain the invisible man in economic theory. -- David B. Audretsch, author of "The Entrepreneurial Society" Baumol is one of the giants in the entrepreneurship field. The Microtheory of Innovative Entrepreneurship will be widely read, discussed, and debated, and is likely to have a significant impact on the scholarly conversation. -- Peter G. Klein, University of Missouri This book is a timely and valuable contribution to the economics of entrepreneurship. Baumol's ambitious goal is to give the entrepreneur his rightful place in economic theory. He demonstrates that, contrary to conventional thinking, the elusive figure of the entrepreneur is indeed amenable to logical economic analysis. -- Simon C. Parker, University of Western Ontario

Table of Contents

List of Figures and Tables ix PREFACE: The Innovative Entrepreneur in Dynamic Microtheory xi INTRODUCTION: Bringing Entrepreneurship and Innovation into the Theory of Value 1 CHAPTER 1: Entrepreneurship in Economic Theory: Reasons for Its Absence and Goals for Its Restoration 9 PART I: Pricing, Remuneration, and Allocation of the Agents of Innovation CHAPTER 2: Toward Characterization of the Innovation Industry: The David-Goliath Symbiosis 25 CHAPTER 3: Entrepreneurship, Invention, and Pricing: Toward Static Microtheory 36 CHAPTER 4: Oligopolistic "Red Queen" Innovation Games, Mandatory Price Discrimination, and Markets in Innovation 57 PART II: Welfare Theory: Technology Transfer, Imitation, and Creative Destruction CHAPTER 5: Optimal Innovation Spillovers: The Growth-Distribution Trade-off 77 CHAPTER 6: Enterprising Technology Dissemination: Toward Optimal Transfer Pricing and the Invaluable Contribution of "Mere Imitation" 101 CHAPTER 7: The Entrepreneur and the Beneficial Externalities of Creative Destruction 128 PART III: Institutions, Payoffs, and the Entrepreneur's Choice of Activity: Historical Origins CHAPTER 8: Economic Warfare as a "Red Queen" Game: The Emergence of Productive Entrepreneurship 139 CHAPTER 9: On the Origins of Widespread Productive Entrepreneurship 152 CHAPTER 10: The Allocation of Entrepreneurship Does Matter 165 CHAPTER 11: Mega-enterprising Redesign of Governing Institutions: Keystone of Dynamic Microtheory 172 CHAPTER 12: Summing Up: Yes, the Theory of Entrepreneurship Is on Its Way 188 Notes 197 References 225 Index 237

About the Author

William J. Baumol is professor of economics and academic director of the Berkley Center for Entrepreneurial Studies at New York University. His many books include The Free-Market Innovation Machine: Analyzing the Growth Miracle of Capitalism and The Invention of Enterprise: Entrepreneurship from Ancient Mesopotamia to Modern Times (both Princeton).

Reviews

"Even as innovative entrepreneurship has emerged as the goal for policymakers around the globe, economists have struggled to find its proper place in microtheory. No more. In this pathbreaking new book, William Baumol provides the blueprint for understanding the crucial role of entrepreneurship and its contribution to innovation and ultimately economic growth. This lively and thoughtful book highlights the distinct role entrepreneurs play in the economy and reveals why the entrepreneur can no longer remain the invisible man in economic theory."—David B. Audretsch, author of The Entrepreneurial Society

"Baumol is one of the giants in the entrepreneurship field. The Microtheory of Innovative Entrepreneurship will be widely read, discussed, and debated, and is likely to have a significant impact on the scholarly conversation."—Peter G. Klein, University of Missouri

"This book is a timely and valuable contribution to the economics of entrepreneurship. Baumol's ambitious goal is to give the entrepreneur his rightful place in economic theory. He demonstrates that, contrary to conventional thinking, the elusive figure of the entrepreneur is indeed amenable to logical economic analysis."—Simon C. Parker, University of Western Ontario