Reflection of Entrepreneurship Theory in Tanzania: A Literature Review.

Abstract

This paper examines the four most used theories of entrepreneurship and their reflection on Tanzania's economy. Entrepreneurship theories have remained the more researched issue in the field of development economics. There are several theories of entrepreneurship from economic theories, psychological, sociological, and several others. The paper used a narrative design to review the empirical literature available on entrepreneurship. During the review, the economic theory of entrepreneurship has many empirical works of literature as compared to others. Other theories examined included, sociological, psychological, and innovation theories of entrepreneurship. The main results from the review are that entrepreneurship has been defined differently depending on the type of study and the use of the theory. However, other scholars define entrepreneurship depending on the economic set-up. In Tanzania, no policy has been developed specifically for entrepreneurship rather the use of small and medium enterprise policy of 2003 is used for entrepreneurship which does not fit exactly with the theories. The notion of entering into business is taken as risk-taking and looking for opportunities. In Tanzania however, the use of all theories as compared to practice has been noted. The study recommends another study to make a clear definition of entrepreneurship in Tanzania by assessing all the entrepreneurship theories.