Business Growth Of Entrepreneurial Activity

In last 20 years,for chian maybe it is more contributive that new firm enter market,but in the long run , if new firm can't grow to be big entreprise, the speed of development of chinese economy must decrease. How large chinese firm can to be ? It is significant problem in micro mean ,but also in macro mean. When we oberserve realistic situation of growth of firm, we find it have charactristic of path- dependent. Path- dependent in moderately dynamic markets is benefit to growth of firm, but in High-velocity markets it will confaint growth of firm, so we must to find a way to defeat path- dependent for growth of firm.In economy and management academy, to research growth of firm is a key theme. The research is forcus on way of growth of firm and growth in economic analysis .we argue all of them have a common basis of economy theory ,ie.New-classic economic ,thus most of their research is indogenous. In my paper, we suggest a model of growth of firm, in the model we argue that growth of firm is a endogenous dynamic process. Growth of firm dependent on outside market opportunity and firm(entrepreneur)'s or can obtain resource and competence, both of them decide objective growth opportunity and entrepreneuerial activity in the firm. We suggest that objective growth opportunity only provide a propability of growth of firm.If you want to realize the propability, it is dependent on manager in firm to recognize the opportunity or entrepreneur's discovery and they match the resouce and opportunity. The process is entrpreneurial process, thus we argue that growth of firm is entrpreneurial process.The difference between our model and orthodox theory of growth of firm is that we emphasis on the resource of firm and entrepreneuerial activity in the firm. resource and competence,entrepreneur discovery opportunity and organizate resource,these activities are factor which are interfact, all of them decide endogenous growth of firm. The distinction of our theory and Penrose's ,a researcher who is the first suggest endogenous growth of firm, is that she argue growth of firm is dependent on firm's resource ,and which contain growth of firm,but she just emphasis on quantity of management resource; She argue that growth of firm is decided by which manager can discovery the market opportunity, willing and able to use opportunity. But she hypothesis all of them are exist, so she simplisitic theory of growth of firm to"Penrose effect",which suggest growth of firm be contianed by quantity of management resource. We argue that her hypothesis isn't realisitic, thus in my theory we emphasis on whether manager can discovery the market opportunity or not,willing or not to use opportunity,have or not competence to match the resouce and opportunity,i.e. whether manager have entrpreneurial competence or not and enhance entrpreneurial activity. In this sense ,I argue my theory is follow and expand Penrose's.Entrpreneurial activity is a very important factor ,which impulse growth of firm. We argue that a whole entrpreneurial activity must include two contains: first, where must have resource and competence which used to match use of opportunity; secondly, The decision maker of strategy who must have entrpreneurial competence ,which be help to discovery opportunity,and to match the resouce and opportunity,except that,he must willing to use their human capital. We argue that other research about growth of firm didn't emphasis on two contains enough or hypothesis that they exist or partly. Although that ,we think if they neglect two contains, they can't explain the path- dependent for growth of firm. In my paper ,we explain the path- dependent in diferent perspect, such as psychologic, economic and management. We argue that the path- dependent in behavior is resource allocation following routine or margin search, becauce decision maker behave under profit uncertainty,larger investment and certaint profit. That can use theory of aversion of losses (Kahneman,1974),game theory in ecionomic and theory of knowledge and competence in management.When we connect a whole entrpreneurial activity included two contains and theory of path- dependent , we argue that when entrpreneurial activity loss,which are key factor to impulse growth of firm, growth maybe have charactiristic of path- dependent. We suggest two typies of path- dependent in firm growth: one is decision maker of strategy who have lossed entrpreneurial competence, as a result, there is path- dependent in firm growth; other is resource of firm which contain firm growth. In entrpreneurial competence and firm growth, we analysis the attitude of entrpreneur,discovery and evaluate opportunity,they organizate newly resource for opportunity,so new organization be found, also for those activity firm growth. But we argue that entrpreneurial competence of decision maker of strategy is dynamic change ,in cycle of life of decision maker of strategy ,they maybe loss entrpreneurial competence or close their human capital,for this there is path- dependent in firm growth. Other ,the organizational capital and technologic capital which accumulitied in firm growth effect on deployment of attention ,as a result ,routine activity will be deployed many resource and opportunity activity can't have resource.For beyond path- dependent in firm growth, we argue that it is key to gain again entrpreneurial activity in firm . For example, we can use CEO succession to those havn't entrpreneurial competence,Redeploy the residue cliancy and control right to those have entrpreneurial competence who don't use it for some reason,regulate structure of board. To use some strategy ,we can gain firm dynamic competence .