ABSTRACT OF PAPER
Title: Two Concepts of Entrepreneurship in an 18th century Dictionary of Commerce
Author: Van Den Berg Richard
Malachy Postlethwayt’s Universal Dictionary of Trade and Commerce (1751-5) was a great mid-18th century repository and conduit of economic knowledge. Accommodating the observations of over 500 authors, it contained an accumulated wealth of agricultural, industrial and commercial facts, practices and theory. Although not a work with a single voice or novel underlying philosophy, the Dictionary was neither an incoherent selection of materials, with only a lexicographical order imposed. Instead it developed themes through clusters of entries, which brought together strands of earlier economic literature. Two of these strands represented in Postlethwayt’s Dictionary develop distinct theories of the entrepreneur, or in the English of the time ‘the undertaker’. On the one hand, there is the conception of the entrepreneur as the principal agent in the economy who bears risk, in particular risk that is due to the variability in market prices. In principle the combined activities of the entrepreneurs considered in this role would have the effect of reducing fluctuations and stabilise provisioning within the economy. Since this conception of the role of the entrepreneur was almost completely taken from Cantillon, who excluded technological change almost entirely from his analysis it can be neatly distinguished of the other conception of the entrepreneur, namely as an agent of change. This second conception developed elsewhere in the Dictionary, for example in the entry ‘Manufactures’ (II, 133) describes ‘the principal undertakers and conductors of our capital manufactures’ as the agents ‘who are, or should be, the great instruments to improve our old manufactures, as well as to strike out such new that will hit the taste of foreign countries’. The importance of continual processes of innovation and emulation is a theme that runs through a whole cluster of Dictionary entries. In these entries the ‘undertaker’ who is successful in his ‘rivalship’ with other ‘undertakers’ through the adoption of new processes or products is given a central place. The significance of finding in Postlethwayt’s Dictionary a distinct conception of the entrepreneur, as an agent of change within a dynamic economy, alongside the better know entrepreneur as a risk taker in a technically static economy, is that the former derives from a separate ‘Baconian’ strand of literature. While the stabilising social function of the Cantillonian entrepreneur suggested a reduced economic role for government, at least to other mid-century readers of Cantillon, the ‘improving’ Baconian entrepreneur suggested the opposite. Postlethwayt recommends a range of desirable government policies to stimulate the activities of the entrepreneur as an agent of change, such as policies to allow import substitution, institutions for the advancement of useful knowledge, the availability of ‘venture capital’, and reforms of the law of patents and bankruptcy.
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