New Books on Entrepreneurship
| Peter Klein |
Princeton University Press has just published Will Baumol’s latest work, The Microtheory of Innovative Entrepreneurship. One of the celebrity dust-jacket endorsers (OK, me) says: “Baumol is one of the giants in the entrepreneurship field. The Microtheory of Innovative Entrepreneurship will be widely read, discussed, and debated, and is likely to have a significant impact on the scholarly conversation.” Hmmm, that’s a bit pedantic. But it’s really a very interesting book, though Baumol defines entrepreneurship differently than I do (as a Schumpeterian, he identifies entrepreneurship primarily with innovation and economic growth). The book is oriented more towards mainstream economists than management scholars, but both groups will benefit from Baumol’s careful and scholarly treatment.
Next month Oxford is bringing out Amar Bhidé’s A Call for Judgment: Sensible Finance for a Dynamic Economy. HBR is running an excerpt titled “The Judgment Deficit” that is worth a read. There Bhidé writes:
As we rebuild from the economic crisis, we must renew the search for the appropriate balance — in finance and in other endeavors — not just between centralization and decentralization but also between case-by-case judgment and standardized rules. The right level of control is an elusive and moving target: Economic dynamism is best maintained by minimizing centralized control, but the very dynamism that individual initiative unleashes tends to increase the degree of control needed. And how to centralize — whether through case-by case judgment, a rule book, or a computer model — is as difficult a question as how much. But these are questions that we cannot afford to stop asking.
While Bhidé doesn’t offer a formal definition of judgment, his treatment in earlier books makes extensive use of Knight (and Hayek), and I think he has in mind the kind of middle ground between formal rule-following and randomness that was central to Knight’s understanding of entrepreneurship.