Most narratives on entrepreneurship developed under the mainstream liberal economics are based on the assumption that economic rationality on the part of entrepreneurs, big and small, would promote economic activity which would lead to economic development of countries. The assumption of economic rationality is seriously questioned by insights from the emerging field of behavioral economics. The present paper attempts to interrogate the assumption of economic rationality on the part of the prototypical entrepreneur and throws some light on the theoretical and policy implications of this exercise. Some of the important behavioral economic concepts are used in the discussion. Entrepreneurship challenges in developing countries like India may be analyzed in terms of ‘Easterlin Paradox’ also. Positional entrepreneurship is a new concept developed in the present paper on the basis of behavioral economics insights. The major thrust of the present paper is that the relevance and effectiveness of mainstream entrepreneurship narratives and training initiatives have to be questioned and skill development and formal sector employment initiatives should be given emphasis. At the end of the paper, policy implications and suggestions for further research are given.
Volume 11 | 11-Special Issue