Explain the role of an entrepreneur in export promotion and import substitution.
An entrepreneur is an individual responsible for developing and establishing a business. The entrepreneur exploits a business opportunity by setting up an entity that meets market needs. The individual or group is expected to manipulate the factors of production to provide goods and services.
An entrepreneur is not restricted to operate locally. They implement expansion strategies and introduce their products and services in other regions where opportunity exists. In this regard, the entrepreneur is responsible for perceiving and acting on business opportunities in other countries.
An entrepreneur will also exploit locally available opportunities. The individual or group would develop products and services to compete with existing providers (local producers and importers). However, for the venture to be successful, the entrepreneur is expected to offer superior value. In this regard, the entrepreneur is responsible for innovation and invention to improve the goods or services.
Entrepreneurs are important in both of these sectors (and really in all sectors) because it is their innovation and their willingness to take risks that allow them to make goods and services that can be exported or that can take the place of imports. Looking at India as an example, we can see that it has been a leader in the export of services to the United States. In order for this to happen, entrepreneurs had to come up with the ideas for the various companies that now export services. Without entrepreneurs, no one takes the risks needed to allow an economy to grow.