OPPORTUNITY AND NECESSITY ENTREPRENEURSHIP, WHAT ELSE?

The existence of small business became more important in the last few decades. Small firms drove innovation and economic growth. Governments adapt policies in order to increase entrepreneurial activity within their country. The importance of small business led to a increase of related studies and institutions to understand and monitor entrepreneurial activity. The GEM (Global Entrepreneurship monitor) is an example of such an institution. The GEM is a non-profit academic research consortium, with the goal to provide high-quality international research data widely available. A lot of research focuses on the reasons why people turn into entrepreneurs. The GEM introduced two main concepts to describe the main reasons. The GEM uses the concepts of necessity and opportunity entrepreneurship to explain why people become self-employed. Opportunity entrepreneurship is the concept where someone becomes self-employed due to opportunities available being self-employed. These opportunities as being self-employed could come from economic and non-economic factors. The possible access to high(er) financial rewards is an example of an opportunity which can be obtained when becoming an entrepreneur. Necessity entrepreneurship is the concept were a inconvenient initial situation leads to the decision to become self-employed. This could be the case if the current situation as an employer has bad future sights or insufficient financial rewards. The GEM made a distinction between opportunity and necessity entrepreneurship by asking people the question whether they were starting and growing their business to take advantage of a unique business opportunity or was it the best option available. (GEM report 2001) This essay describes the two concepts of opportunity and necessity entrepreneurship and tries to discuss these concepts.