The Use of Knowledge in Entrepreneurship | Hunter Hastings

added 26.03.2020 18:56

by Hunter Hastings from mises.org

We wouldn’t need entrepreneurs if we possessed all relevant economic information, if we knew every detail of customers’ preferences, and if we had complete knowledge of all the means by which customers could realize their preferences.

The peculiar role of the entrepreneur is determined by the fact that this knowledge of customers’ ends and their available means never exists in concentrated or integrated form, but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all separate individuals possess.

The economic problem that entrepreneurs address is the utilization of knowledge that is not given to anyone in its totality to secure the best use of available resources for ends whose importance only other individuals know.

The economic problem that the entrepreneur deals with is rapid adaptation to changes in the particular circumstances of time and place.

This adjustment may rapidly spread throughout the whole economic system and effect major changes in supply and demand, but the individual entrepreneur does not concern himself or herself with the system, just with the actionability of local and specific knowledge that they regard as essential even if it is, in theory, imperfect.