The term ‘‘entrepreneur’’ as ordinarily employed in economic literature is a

holdover from the classical era of political economy, when individual proprie-

torships and partnerships were predominant and when those who possessed the

ownership equities in corporations were supposed to exercise effective decision-

making power. Now, in its customary definitions, it fits neither the requirements

of modern theory nor the historical pattern marked by concentrations of power

in government, labor groups, and officers of the firm. A revision of the concept is

appropriate. Recent discussion has emphasized the importance of this fact; cur-

rent usage of the term is unsettled, although its definition and the considerations

underlying choice of a definition are vital both to an accurate account of the

structure and functioning of an economy and to research in economic history.1