What is the role of entrepreneurship in import substitution?
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Import substitution is the process in which an economy replaces imported goods with domestic goods. In doing so, it creates a stronger and more diverse domestic economy. Entrepreneurship can play an important role in this process. Entrepreneurs can become the driving force behind the new domestic industries. They can identify industries that they think will succeed. Having done that, they take the risk (which is a major aspect of entrepreneurship) of devoting resources to this new industry. Their efforts and their willingness to accept risk can help to create a variety of new industries in a country that is trying to adopt an import substitution strategy.
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