Purpose
Creativity and innovation are interrelated, and indeed often conflated, concepts. A corollary to this distinction is two different perspectives or types of entrepreneurship and entrepreneurs. The purpose of this paper is to explore the distinction between creativity and innovation on the basis of their relationship to history and implications for understandings of entrepreneurship.
Design/methodology/approach
This paper is a theoretical exploration of entrepreneurship understood in relation to a proper distinction between creativity and innovation. Creativity and innovation differ from the perspective of their relationship to what has already happened in history vs the radical novelty of a particular discovery or invention.
Findings
Creativity can be understood as what human beings do in connection with the fundamental givenness of things. Innovation, on the other hand, can be best understood as a phenomenon related to the historical progress of humankind. Innovation is what human beings discover on the basis of what has already been discovered. Entrepreneurs can be seen as those who discover something radically new and hidden in the latent possibilities of reality and creation. Or entrepreneurs can be seen as those who develop new, and even epochal, discoveries primarily on the basis of the insights and discoveries of those who have come before them in history.
Originality/value
This paper provides a helpful conceptual distinction between creativity and innovation, and finds compatibility in these different perspectives. A holistic and comprehensive understanding of entrepreneurship embraces both its creative and innovative aspects, its metaphysical grounding as well as its historicity.
Recent studies have indicated that the terms "NAIRU" (non-accelerating inflation rate of unemployment) and "natural rate of unemployment" are not interchangeable. While NAIRU is an empirical macroeconomic relationship estimated via a Phillips curve, the natural rate is an equilibrium condition in the labor market, reflecting the market's microeconomic features. This paper evaluates comparatively the inflation-forecasting power of alternative time-varying estimates of the natural rate of unemployment relative to the NAIRU. I estimate the natural rate of unemployment in the U.S. since World War II. Three alternative methods are utilized: the Kalman filter, a structural determinants approach, and the Hodrick-Prescott filter. In the section that follows, I assess how each estimator of the natural rate compares to the others-as well as to the NAIRU derived from a Phillips curve-in forecasting inflationary changes in the United States in the second half of the twentieth century. The analysis reveals that the overall inflation-forecasting utility of the natural rate of unemployment relative to the NAIRU is not very different. Moreover, the conclusion appears to be quite robust to various estimators of the natural rate.2
An incentive-compatibility framework for regulating a monopolist with unknown costs is applied to the sponsor's problem of monitoring a bureau. Following Mueller (1989), the bureau does not make take-it-or-leave-it budget proposals to the sponsor. Rather, the bureau must announce a marginal cost per unit of output to the sponsor. Given that report, the sponsor chooses a price that it will pay to the bureau for each unit of output, and the sponsor chooses the level of output as well. The analysis reveals the price per unit of output that the sponsor must pay to the bureau to maximize social welfare.AUTHOR'S NOTE: The author wishes to acknowledge Ronald J. Balvers, Russell S. Sobel, and Eun-Soo Park-as well as participants in the dissertation workshop in the economics department at West Virginia University-for many helpful suggestions, comments, and conversations. Two anonymous referees also provided useful comments.All remaining errors are, of course, mine.
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