Do you know what the role of entrepreneurship is in the economic development of Nigeria? This article will enlighten you on the concept of entrepreneurship and its importance in the economic development of our country.
Due to the current economic downturn in Nigeria, there have been a lot of calls and push for entrepreneurship. The government, organisations, different individuals, etc. want people to start their own businesses. This is as a result of the importance of entrepreneurship in economic development of the nation.
Over the years, a high level of entrepreneurship is what has led to the economic development of many nations we see today. Even the United Nations University World Institute for Development and Economics Research carried out a project on the role of entrepreneurship in economic development. Their work was compiled into a book titled Entrepreneurship and Economic Development.
China is a good example of a nation with an impressive economic development that came about as a result of the promotion of entrepreneurship among its citizens. Well developed countries are more interested in entrepreneurs than people in white collar jobs. In the economy today, education is being redefined to produce entrepreneurs and not just job seekers. So, the role of entrepreneurship in the economic development in Nigeria cannot be underestimated especially in times like this.
Before we start listing the roles and advantages of entrepreneurship in Nigeria, you need to understand what entrepreneurship is about.
READ ALSO: History of entrepreneurship in Nigeria
What is entrepreneurship?
The concept of entrepreneurship is poorly understood by many. Most people see it as just starting a business and making money. But that is not what entrepreneurship is. It is more than just having a business. It is a special way of life and mindset in which people are innovative and try to solve some particular problems while also creating value in the society.
Entrepreneurship has been described as the driving force of decentralising and restructuring an economy while moving it towards a market economic process. So now that we understand the concept of entrepreneurship, let us move further and look at the roles of entrepreneurship in the economic development of Nigeria, in particular.
What are the roles of entrepreneurship in Nigeria?
Entrepreneurship in Nigeria has helped the economy of the country over the years in a lot of ways. Let us take a look at some of the most important roles of entrepreneurship in economic development of our country.
1. Creation of job opportunities
Entrepreneurship creates job opportunities, first for the entrepreneurs. However, entrepreneurs are referred to as job creators as well, because when they start a business for themselves they create jobs for other people. Once more of these business hire people, they reduce the unemployment rate in the country.
2. Development of Small and Medium-sized Enterprises
Entrepreneurship in a country promotes and gives strength to Small and Medium-sized enterprises (SMEs). The level of entrepreneurship development in a nation is determined by the number of Small and Medium-sized enterprises (SMEs). The more SMEs a country has, the more likely it will attain progress.
3. Increase in Gross Domestic Product (GDP) and Per Capita Income
Gross Domestic Product is known as the total value of all the goods and services that are produced by a country in one year. Per capita income is the average income earned per citizen or resident of a geographical region in one year. Per capita income is calculated by dividing the total income of a geographical area by the population. Entrepreneurs make use of the resources in a country to produce more goods and services and added value. This will, in turn, increase the Gross Domestic Product of the country. Also, SMEs create employment income for people, thereby accounting for an increase in the per capita income of Nigeria as a country. A growth in the Gross Domestic Product (GDP) and a high per capita income are strong indices of economic development of a country.
4. Wealth creation and distribution
Through the creation of business entities, wealth is mobilized and distributed by entrepreneurs. The public will benefit from the success and wealth of entrepreneurs in Nigeria. As businesses grow and expand, it allows for more investors to come into the market with their ideas to improve the goods and services and make them available at an affordable rate. The more capital and resources are being pooled into generating product and services, the more entrepreneurs, employees, and the public will benefit from it. Wealth is created for the entrepreneurs and also distributed to the public in the form of employment, goods, and services.
5. Improvement of the standard of living
The standard of living of a country is usually determined by the per capita income of the country. It is the amount of wealth, goods, and services available to people, especially of the lower socioeconomic class. Entrepreneurship through Small and Medium-sized Enterprises will provide more employment income for Nigerians. As explained above, this will increase the average per capita income of Nigeria and as a result improve the standard of living. Also, innovative ideas of entrepreneurs who create wealth, goods and services that improve the lives of the people in the country.
From every points listed and explained above, we can see the importance of entrepreneurship in the economic development of Nigeria. However, so far, entrepreneurship through the Small and Medium-sized enterprises have performed below expectations. This poor performance has been due to some of the challenges of entrepreneurship development in Nigeria. But there is still hope in the potential and great prospects of entrepreneurship in the economic development of our country.
READ ALSO: Entrepreneurship development in Nigeria: problems and prospect
Source: Zenithblog.com
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