Edited by Gordon E. Shockley, Peter M. Frank and Roger R. Stough
Chapter 4: Non-market Sources of American Entrepreneurial Capitalism
Zoltan J. Acs, Ronnie J. Phillips, David B. Audretsch and Sameeksha Desai INTRODUCTION The success of the American economy over time has been linked to its entrepreneurial spirit. Individual initiative and creativity, along with small business and wealth creation, are indelible parts of the American spirit. The recent technological revolution and resulting economic restructuring have made both the general public and government oﬃcials keenly aware of the entrepreneur’s role in job and wealth creation (Hebert and Link, 1989). This critical role in economic development has fostered eﬀorts by all levels of government to promote entrepreneurship (Hart, 2001). However, another crucial component of American economic, political and social stability is increasingly recognized: Philanthropy. Merle Curti in 1957 advanced the hypothesis that ‘philanthropy has been one of the major aspects of and keys to American social and cultural development’ (Curti, 1957: 353). To this we would add that philanthropy has also been crucial in economic development. Further, when combined with entrepreneurship, the entrepreneurship-philanthropy nexus (Acs and Phillips, 2002) becomes a potent force in explaining the long-run dominance of the American economy. A major diﬀerence between American capitalism and many other forms of capitalism1 (Japanese, French, German and Scandinavian) is a historic focus on both the creation of wealth (entrepreneurship) and the reconstitution of wealth (philanthropy). Philanthropy is imbedded within an implicit social contract that stipulates wealth beyond a certain point should revert to society (Chernow, 1999). Although individuals are free to accumulate wealth, it must be invested back into...
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