If we observe the socialist market economic system at the current stage from the perspective of the main body, it is not difficult to find that the entrepreneurial class is an obvious "short board". Of course, in any case, entrepreneurs are destined to be the most scarce element, and in today's China, this issue has a special and urgent nature, so today we are specifically exploring this topic.
<h1 class="pgc-h-decimal" data-index="01" data-track="2" > a "theoretical model" for successful entrepreneurs</h1>
China's reform and opening up has created a number of successful entrepreneurs, among whom representative figures include: Ma Yun, Ma Huateng, Wang Shi, Feng Lun, Liu Yonghao, Zong Qinghou, Liu Chuanzhi, Huang Nubo, Pan Shiyi and so on. They can stand out from the crowd of entrepreneurs, which is the pride of our time. The emergence of successful entrepreneurs is the result of a series of trial and error, and these trial and error results are "right" events, all of which are small probability events, and are the "product" of multiple small probability events. Based on my observations and combined with the relevant literature, I have tried to propose a theoretical model of the so-called successful entrepreneur, that is, the product of three small probability events that a successful entrepreneur equals.
The first low-probability event is entrepreneurship. Here, entrepreneurship is a plural, that is, successful entrepreneurs need N times to start a business; Entrepreneurship contains innovation, and we now often associate entrepreneurial innovation as the same thing, which is an accurate reflection of reality. In the special period of the beginning of China's reform and opening up, commodity shortages were widespread, so in that period, as long as you look at the courage and can bear hardships, you can start a business, and there are different degrees of gains. In today's society of total surplus, entrepreneurship without innovation is difficult to imagine. Among the people who are willing to start a business, it is a small probability event that they can eventually become entrepreneurs.
Entrepreneurs have at least three traits: One is risk appetite. Experiments in psychology have shown that the types of risk appetite are far fewer than those of risk-averse types. The second is organizational talent. That is, the fourth factor of production that Alfred Marshall said was organization. Organizational talent here includes the ability to make decisions, the ability to know people and do good job, and so on. The third is passion or curiosity. As mentioned above, entrepreneurship contains innovation, and in Schumpeter, innovation is the characteristic of entrepreneurs, entrepreneurs. Innovation in the Schumpeter sense is a change in the function of production, that is, a revolutionary change in the combination of input factors. People who are willing to constantly make changes are usually passionate or curious.
If entrepreneurship is a subjective behavior, it is a trial and error of whether it has the ability to start a business, then it must be combined with the objective environment to produce specific results, which has a second small probability, that is, the market, entrepreneurs have to try and make mistakes in market demand. In a society with a total surplus, the discovery of new market demand is a small probability event. There are at least two problems here: first, an excellent sense of direction and the ability to grasp the needs and their evolution. In real life, good entrepreneurs and entrepreneurs often have this sense of direction, in this sense, the endogenous driving force of industrial development comes from entrepreneurial innovation. Second, whether there is a profit model for this demand. Many entrepreneurs have ideas that look very good, but they just don't have the scale to reach the level of profitability, insist on it for a period of time, and "burn" all the money that can be "burned", and it will be finished. Of course, you can also turn the supply of other manufacturers into your supply, but why do you rely on it? In a more competitive industry, you can only rely on technological innovation, model innovation, or a certain know-how, and it is possible to do this. However, in industries with high technology, capital thresholds or other regulatory conditions, this is not easy to say. So, this is also a small probability event.
After these two trial and errors, you can become a boss in the usual sense, but you are still far from being a successful entrepreneur. The third trial and error is to try and make mistakes on your personality. Many years ago, when I watched Wu Xiaobo's "The Great Defeat", I was quite surprised that these entrepreneurs who fell into the defeat were all private entrepreneurs, why did they blindly expand until the enterprise collapsed? I think about it, and this may have to be explained by character flaws. The impact of the external environment may crush some enterprises, but the enterprises will eventually collapse in the hands of the entrepreneurs themselves. That's what more than one boss told me.
What are the common flaws? First, self-inflation, blind expansion leads to out-of-game, which is the result of self-inflation. Second, excessive speculation psychology, in the transition period of China, the most prone to improper government-business relations, which is a typical manifestation of excessive speculation, there are not a few enterprises that fall on the relationship between government and business. Third, the bosses' own bad habits or vices, which are not a problem when the financial situation is still good, and when they encounter a crisis, they become the last straw that crushes them. So, entrepreneurs have to pass the personality barrier, in the words of Max Weber, to find a balance between incentives and constraints.
In the early 20th century, Weber elaborated on the ideal type of entrepreneur in his book Protestant Ethics and the Spirit of Capitalism. They, he wrote, "possessed distinct and high moral character, as well as foresight and the ability to act"; "They are full of energy in calculation, and more importantly, they are moderate, trustworthy, shrewd and strong, and fully committed to their careers"; "Only a new type of entrepreneur with an exceptionally strong personality can not lose self-restraint and avoid the double destruction of morality and economy." It can be seen that in successful entrepreneurs, it should be a perfect combination of encouraging and restraining two entrepreneurial spirits. However, the reality in China is that the incentives for trial and error in the whole society and other related incentives are insufficient, hindering the exertion of the entrepreneur's first spiritual characteristics. The lack of legal constraints, moral constraints, and belief constraints makes the second spiritual characteristic that entrepreneurs should have also perform flat. In other words, entrepreneurs who can pass personality trial and error are even rarer, which is the third small probability event.
Whether the specific data of these three small probability events can be obtained through big data technology is unknown to me now, but it is an indisputable fact that the probability of these three events occurring is very small and smaller after multiplying. That's why the successful entrepreneurs we see in real life are a very niche group. The importance of this very small group to human society goes without saying. However, experience shows that different cultural traditions and institutional (institutional) environments will directly affect the above probabilities; in other words, in different cultural traditions or institutional environments, the possibilities of entrepreneurial trial and error, demand trial and error, and personality trial and error are divided into large and small, and the probability of success is even more different. Therefore, the change and improvement of external factors will increase the possibility of entrepreneurs, entrepreneurs' trial and error and success, which is self-evident in the importance of human society.
<h1 class="pgc-h-decimal" data-index="02" data-track="65" > China's cultural traditions and institutional environment restrict the growth of entrepreneurs</h1>
China has long been in an agrarian civilization, with a serious prejudice against industry and commerce, and the concept and policy of emphasizing the original and suppressing the end, that is, emphasizing agriculture and suppressing commerce, have long dominated. During that period, there were also some industrialists and businessmen active in social life, but they had no social status and their role was not valued. Although in the later period of agricultural civilization, regional merchant groups such as Huishang and Jinshang appeared in China, and their economic strength was considerable, they still wandered on the fringes of society and were not accepted by mainstream society. The idiom "no business, no adultery" in traditional society reflects the discrimination of agricultural civilization against commercial civilization and industrial and commercial classes. In addition to The natural conditions in China and the factors that were very important in agricultural production at that time, this was also related to the feudal rulers' fear that the merchants were powerful and threatened their power. In traditional Chinese society, "learning and excellence" is a shortcut to high-level power and prosperity, and businessmen are the end of the four peoples (scholars, farmers, workers, and merchants), which is the traditional Chinese social structure. Of course, with the development and maturity of the market economy, this concept and related policies are also undergoing profound changes, but the influence handed down for thousands of years is still not to be underestimated, they penetrate into all aspects of social life, and even melt into people's blood.
At the end of the 19th century and the beginning of the 20th century, with the "west wind and eastward wind" of modern industrial and commercial civilization, a group of entrepreneurs appeared in China, and the representative figures among them were Sheng Xuanhuai, Chen Guangfu, Lu Zuofu, Zhang Qian, Liu Hongsheng, Zhang Yuanji, etc. Due to the long period of external aggression and internal war, most of their careers are in a state of instability and displacement. Even so, they were still china's first entrepreneurs in the modern sense. They not only have the skills to operate and succeed in entrepreneurship, but also run education, run hospitals, devote themselves to public welfare, and are committed to establishing an institutional environment that guarantees the development of enterprises. This is the process by which they make history, and it is also the process of self-shaping.
Why is it that the government is particularly important in China's economic activity, and in some periods or regions, economic activity that is in short supply will stagnate? One fundamental reason is the lack of an entrepreneurial class. When we discuss the relationship between the government and the market, we often say that the government is offside, why is it offside? It is because entrepreneurs are absent, and severely absent. In the period of the planned economic system, there was only one "operator" of economic activity in the whole country, that is, the central government. In the period of transformation from the planned economic system to the market economic system, the market began to develop, and entrepreneurial and innovative activities became increasingly active, but the main body of the market, especially the main body of entrepreneurs, was far from being able to assume the heavy responsibility of resource allocation, so a large and multi-level local government came to the center of economic activities. We do not deny that there is some legitimacy to this in that particular period. However, if we believe that this is the norm, China's economic system is the so-called "three-dimensional system" composed of the central government, local governments and enterprises, and the government, especially local governments, must continue to exist in microeconomic activities, then the entrepreneurial class that is compatible with the mature market economy, and even China's socialist market economic system, may never be formed, let alone perfected.
Why is there a deformed and improper relationship between government and business in China's economy, on the one hand, rent-seeking is rife and officials are corrupt, on the other hand, there are very few entrepreneurs with social responsibility, spiritual pursuit and entrepreneurial consciousness, which do not match China's economic aggregates and China's status as a great power? Here, a fundamental reason is that the environment in which the entrepreneurial class grew up was imperfect. In this regard, we can look at it from the perspective of the government and entrepreneurs, respectively. Because important resources are in the hands of the government, due to the prevalence of administrative approvals and controls, it is inevitable that entrepreneurs can obtain resources and improve efficiency through rent-seeking means. After more than 30 years of reform and opening up, a class of entrepreneurs who once disappeared has reappeared in front of us, and has more and more economic resources and more and more discourse power, however, most of them still lack sufficient awareness of fulfilling social responsibilities. They also have unshirkable responsibilities for all kinds of improper government-business relations in today's society. Of course, the old system, the old system, is the crux of the problem. I agree with Feng Lun that entrepreneurs can break through the shackles of the shortcomings of the old system if they do not violate some rules. If entrepreneurs have original sin, it is mainly the original sin of the old system.
Why is it that in China's reform, the reform of state-owned enterprises has always been a difficult "knot" and has not yet made a final breakthrough? I think there is a dilemma here: the system of state-owned enterprises basically does not produce entrepreneurs, and state-owned enterprises without entrepreneurs cannot really become the main body of the market. The leaders of state-owned enterprises, especially wholly state-owned and state-controlled enterprises, have few entrepreneurial activities and do not bear investment and business risks, and even their selection, assessment and promotion mean that they are quasi-officials, not and cannot be entrepreneurs. Some people ask, how far is it from the leader of a state-owned enterprise to an entrepreneur? This is actually a false proposition. There is generally no pathway between the leaders of state-owned enterprises and entrepreneurs, except for a few exceptions. How to make the vast majority of the restructured state-owned enterprises into enterprises with entrepreneurs is a key reform that urgently needs to be solved before us.
After answering the above three questions, let's further clarify a few pairs of relationships.
First of all, under the dual pressure of strong governments and strong state-owned enterprises, the opportunities for entrepreneurs or non-state-owned enterprise managers to try and make mistakes in the market are reduced, and the opportunity cost is very high, which to a large extent inhibits the willingness of society to start a business and innovate, and the foundation for the expansion of entrepreneurship is getting weaker and weaker.
Second, the improper relationship between officials and entrepreneurs will inhibit the cultivation of entrepreneurship and the growth of entrepreneurs to a certain extent.
Like what:
1) "Selfless" officials helping entrepreneurs will make entrepreneurs forget about market-based self-adjustment;
2) "Self-interested" officials helping entrepreneurs will lead to many transaction costs such as rent-setting and rent-seeking, and these high transaction costs will reduce the probability of success of market trial and error, and the related benefits may drive entrepreneurs to neglect to invest in corporate innovation and human capital;
3) The specificization of the object of help of officials, bribery and extortion will follow, which will greatly reduce the individual's willingness to start a business, resulting in a very high risk of business operation;
4) The auction system of resources will lead to a sense of inequality of opportunities for entrepreneurs, or the relationship investment of entrepreneurs;
5) The bias of rule-making will lead to a sense of unfairness in the rights of entrepreneurs;
6) The bias of rule enforcement will lead to a sense of unfairness in the entrepreneur.
And so on.
Finally, SOE leaders also face political promotion incentives, and this homogeneous incentive of government officials and SOE leaders cannot form an effective and benign relationship between government and entrepreneurs.
<h1 class="pgc-h-decimal" data-index="03" data-track="74" > entrepreneurial economy is a mature form of market economy</h1>
In the "Introduction" of the book "Innovation and Entrepreneurship", Peter Drucker directly uses the title of "Entrepreneurial Economy" to expound the background, origin and impact of the evolution of the market economy to the entrepreneurial economy. Drucker points out: "Since the mid-1970s, phrases such as 'zero economic growth,' 'U.S. restrictions on industrialization,' and a long period of 'Kondratyev economic stagnation' have been enshrined as golden rules and have become very popular in the United States. However, facts and figures prove that these views are completely nonsense... During this period, the U.S. economic system underwent profound changes, from a 'managed' economy to a 'entrepreneur' economy. Drucker pointed out that an important contribution to the entrepreneurial economy is a substantial increase in employment. This increase in employment does not come primarily from "high technology", but from "entrepreneurial management", "the result of the completely new application of knowledge to human work"—entrepreneurial enterprises. Drucker attributed this economic phenomenon based on "entrepreneurial management" to the entrepreneurial economy. "In america, we have a new economy, an entrepreneurial economy," he said. According to Drucker's understanding, the entrepreneurial economy is clearly a more mature and vital economic form, or a more mature market economy.
After the international financial crisis, one of the important reasons why the US economic recovery is better than that of Europe and Japan is the innovation in the US real economy, that is, the entrepreneurial spirit in the US economic activities is better than that in Europe and Japan. An important aspect of the gap between emerging and advanced economies is that innovation and entrepreneurship in economic activities have not reached the corresponding level. Drucker said, "To date [in 1985], the entrepreneurial economy has been purely an American phenomenon. This sentence is not without American conceit, but it is more or less telling the truth. I believe that for any country, there is an inherent regularity in the evolution from the market economy to the entrepreneurial economy, which is a fact that can be corroborated by existing experience.
The Third Plenary Session of the Eighteenth Central Committee of the Communist Party of China pointed out that economic structural reform is still the focus of comprehensively deepening reform, and the core issue of economic structural reform is still to properly handle the relationship between the government and the market. To further handle the relationship between the government and the market is actually to deal with the question of whether the market plays a decisive role or the government plays a decisive role in the allocation of resources. On this issue, a major theoretical viewpoint put forward by the Third Plenary Session of the Eighteenth Central Committee of the Communist Party of China is to make the market play a decisive role in the allocation of resources. The next question, then, is, who is the subject that plays a decisive role? The answer should be very clear, that is, entrepreneurs, and the business owners or business leaders who are trying to become entrepreneurs. The proportion of entrepreneurs, especially successful entrepreneurs, who play a decisive role in the allocation of resources, is relatively high, which can be regarded as a clear indicator of the maturity of the market economic system. The important intention of emphasizing the decisive role of the market in the allocation of resources has been interpreted more often as deepening market-oriented reforms. There is nothing wrong with this, of course, but there should be another important purpose, that is, to solve the problem of the driving force of sustained economic growth.
After more than 30 years of high growth, China's economy is undergoing profound changes in its growth conditions and environment, so it is necessary to carry out a difficult transformation of growth and development mode. At the same time of transformation, we still need to maintain a growth rate of 7% to 8%, which is the requirement of the established development goals and the requirement of ensuring the sustained and stable development of China's social economy. Obviously, we have plenty of room for growth – China's per capita GDP is about 1/9 of that of the United States and 1/6 of Europe's; its per capita capital stock is less than 1/10 of that of the United States and 1/4 of South Korea's. At the same time, urbanization, industrial upgrading, inter-regional gaps and private economic growth are all huge growth space. However, after calm observation and reflection, we find that the driving force of China's economic growth has the problem of decay or even inadequacy.
Studies in economics have shown that the driving force of modern economic growth mainly comes from: technological change inherent in the economic system, intellectual capital and entrepreneurship characterized by increasing marginal returns. Here, entrepreneurship has a decisive subjective significance, and thus a fundamental one. Entrepreneurship as a driving force for economic growth is embodied in the ability of entrepreneurs to convert savings into effective investments and form capital; Entrepreneurial entrepreneurship and innovation are the main channels for absorbing employment and increasing residents' income; Entrepreneurs discover markets through constant "trial and error" of demand, transform potential demand, and thus promote consumption growth. Apple's case strongly illustrates that entrepreneurs are the source of market creation, investment and consumption; Through their own innovation, entrepreneurs can upgrade their products and services and enhance their export competitiveness. China currently lacks the soil and environment for the healthy growth of entrepreneurs, which also explains why the government plays an extraordinary role in the Chinese economy. However, in the competitive field, in fact, most areas of economic activity are competitive, and the consequences of government investment replacing and crowding out private investment, and government intervention replacing and crowding out the independent operation of enterprises are self-evident. China's economy cannot continue to repeat the mistakes of the past. To achieve this, only by returning the entrepreneurial spirit to its due position, to create and optimize the institutional environment for entrepreneurship and innovation and entrepreneurial growth.
Finally, I would like to quote a passage from Weber as a closing remark today. He said: "The question of the dynamics of the expansion of modern capitalism is, first of all, not the question of the source of the amount of capital used for capitalist activity, but the question of the development of the capitalist spirit. Wherever the spirit of capitalism emerges and functions, it can produce its own supply of capital and money as a means to its own ends, but the reverse is incorrect. The entry of the capitalist spirit into the stage of history is usually not smooth. Doubt or hatred, especially moral indignation, rushes like a beast to the first innovator. "Here, the spirit of capitalism means entrepreneurship; the innovator (innovator) should be translated as the innovator, that is, the entrepreneur.
(This article is excerpted from Chen Xian's Selected Works, Shanghai Jiao Tong University Press, 2021)