Quarterly Journal of Austrian Economics

Volume 6,  No. 3 (Fall 2003)

This article describes how theories of entrepreneurship can be completely incorporated into a model of the competitive process to show that entrepreneurship is the engine of economic progress, to show that entrepreneurship is necessary for firms to survive in competitive markets, and to show that product differentiation is one of the competitive strategies that produces economic progress. The result is not a steady-state competitive equilibrium, nor would such a result be optimal. The result is a competitive process where firms continually improve their production processes and the characteristics of their output in order to remain competitive, and this process results in continual economic progress.