William Baumol’s “Entrepreneurship: Productive, Unproductive, and Destructive”

  • Matthew McCaffrey


This chapter offers a retrospective account of William Baumol’s “Entrepreneurship: Productive, Unproductive, and Destructive” in light of its influence on entrepreneurship studies. The first section describes Baumol’s core arguments about the influence of institutions on the allocation of entrepreneurial talent. The second section then discusses their impact on the entrepreneurship discipline. Following this, the third section explores some criticisms of Baumol and explains how addressing these criticisms can provide paths forward for entrepreneurship studies that do justice to Baumol’s work while at the same time integrating it into important emerging research. In particular, Baumol’s arguments open the way to research on institutional entrepreneurship as well as the judgment-based view of entrepreneurial decision-making. The fourth section then considers the policy implications of Baumol’s work. The final short section concludes.


Productive entrepreneurship Unproductive entrepreneurship Destructive entrepreneurship Institutions Institutional entrepreneurship Innovation Economic growth Entrepreneurial judgment 


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© The Author(s) 2018

Authors and Affiliations

  • Matthew McCaffrey
    • 1
  1. 1.University of ManchesterManchesterUK

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