5 Ways an Entrepreneur Stimulates the Economy



Entrepreneur’s contribution to the economy is of immense value. He or she is indispensable to the economic growth of the country. His or her products are valuable to the overall development of the society. People need their products. They simply cannot do without them.

Ours is a consumer society now. Even in the developing countries consumerism is gaining ground. Developed countries anyway thrive on consumerism. Naturally, the role of an entrepreneur is of much significance in generating products valuable for the com forts and luxurious living of the people of a particular country.

An economy is much dependent upon the performance level of its entrepreneur. He or she plays a vital role in the growth of the national income as well as raising the per capita income of the people.

How does an entrepreneur stimulate the economy?

  1. Investment – Then entrepreneur has to invest in what is required for the economy. Economic progress will much depend upon his or her contributions. Any entrepreneur will invest in products and services which the people need. His or investment will ensure a better life for the people. More goods and services will be at their disposal.
  2. Employment – An entrepreneur by setting up various businesses and establishments is generating employment in the economy. People need jobs. This is a major contribution that an employer can make to provide income to an employee who can meet his or her needs.
  3. Diversity in products and services – An entrepreneur can provide various types of goods and services to the consumer. The latter has much to choose from. A consumer after all would like to have a good bargain, and if his or her choices are more than he or she can get these products or services at reasonable rates. Also personal desires are met if there are products and services to choose from. A person may like a particular type of tie and he can perhaps locate it in his local market. His desire to purchase a tie of his choice is thus met.
  4. International trade – An entrepreneur promotes international trade by selling his or her products abroad. Any entrepreneur would like a wider market. If there are more consumers to purchase his or her products, the higher his profits.
  5. Contributes to gross national product – An entrepreneur makes much contribution to the national exchequer and to the national economy as whole. The GNP of the country is calculated based upon the total number of products and services available in a respective country. The more products and services available the higher the GNP. It indicates the economic prosperity of the country.

The entrepreneur is essential for the economic development of a country. The progress of a country will depend upon his skill and talent as well as hard work to deliver necessary goods and services required by the citizens of his or her country.



  1. In addition to this,the country’s economy will also increase through payment of tax.Income tax can be a simple example of these taxes to be made as people will be employed

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