To succeed, entrepreneurs must demonstrate superior foresight and judgment, and practice continuous dynamic improvement in their assembly and reassembly of assets to serve the consumer.
In a totalitarian system, competition means courting the favor of those in power. In the market system, competition means sellers try to outdo one another by offering better or cheaper goods and services to the buyers.
It is always a challenge for entrepreneurs to try and predict what customers will want in the future. But now things are even more unpredictable. And government regulations aren't helping either.
Although many claim "nobody saw this coming," some entrepreneurs planned ahead and also have found ways to cater to customers under new conditions.
Capitalists and entrepreneurs serve distinct functions in the real economy. Capitalists save money that then maintains production processes until final goods are produced. Entrepreneurs adjust the capital structure in light of uncertainty to produce the most desired goods. Capitalists are rewarded with interest, entrepreneurs with profit.
The coronavirus crisis has unleashed two types of bankruptcies that are very different, have different causes, and should require different solutions.
