Most economic theorists nowadays appreciate that particular theories are peculiarly relevant to particular historical situations, and gain their chief importance from this relevance. In place of one absolute set of propositions, economists are becoming accustomed to the idea that their theoretical arsenal needs to include, for example, weapons suited to conditions of approximately full employment, and different weapons suited to conditions of depression. The dependence of theory on conditions properly goes further than this. We need to ask whether our fundamental concepts are appropriate to the historical conditions of the time to which they are to be applied.

While definitions of terms must vary with the purposes of their use, several studies of American entrepreneurship might be started with the word entrepreneur confined to those business executives who are associated with (a) the organization of new business units, (b) substantial expansions of established units, and (c) strenuous efforts to adapt established units to a changing environment. Such a conception, which uses terms that would obviously have to be made more precise as a study progressed, excludes from the term entrepreneur those business executives who carry on more or less routine operations, and it directs attention to the dynamic activities of businessmen. It is a little broader than a strict interpretation of the term innovator and fits fairly well the idea implicit in many definitions of the term entrepreneur, namely, that the entrepreneur is the businessman who introduces new ideas and changes the rate at which the wheels of enterprise go ‘round. Moreover, it utilizes three types of business activity concerning which there are data available for studies of the policy-determining executive. I should perhaps add that those who attempt to organize, expand, or adapt business units should be called entrepreneurs as well as those who achieve these goals. Attempts often reveal new ideas that successors are able to put into operation.