No Free Lunch: Economics for a Fallen World: Third Edition, Revised

Chapter Nine: P31W: Enter the Entrepreneur! 222 CHAPTER NINE ANSWERS 1. By real time, we mean a time where change can take place. In orthodox economics, we use comparative statistics as a technique to change one variable, and hold everything else constant—ceteris paribus. Yet the real world cannot hold anything constant. In addition, the things that are often assumed to be constant are precisely the things that change in the market process (consumer preferences, demand schedule, supply schedule, etc.). 2. Not necessarily true. It should be true that Christians should be less risk averse than non-Christians because we should be willing to boldly act in faith if we think God has called us to a task. Yet, our worldly success may not necessarily be part of his plan. God cares much more about our soul’s success than our earthly success. 3. Entrepreneurship is fundamentally about meeting either unsolved needs or coming up with better ways to solve needs—this is problem solving. Christians should be good at problem solving because our hearts should be inclined toward meeting the needs of others. 4. This is up to the reader, but some things to consider are, while the destruction is regrettable in some sense, the overall benefit to society is very positive. Simply consider the amazing increases in living standards and quality of life over the last few hundred years. So what to do about those that see their livelihoods reduced? First, we have a responsibility as Christians to personally make sure we are prepared to serve others. That suggests we ought to be constantly honing/upgrading our skills to serve others. Thus we should not need assistance. If someone’s job is destroyed, there is a biblical hierarchy of response: (1) they should seek other employment while using savings to retool their skills as necessary, (2) if they have no resources, they should seek family members to support, and (3) if there are no family members to support and they have no resources, they should seek assistance from the church. 5. Entrepreneurship finds more productive use of resources to allow additional production within the same level of resources—new ways of employing productive inputs, toward higher valued outputs. Government incentives should encourage and not discourage entrepreneurship. 6. See chapter discussion, but could include prescience, perseverance, creativity, and risk bearing. 7. All action is in a sense speculative because we don’t know the future—it is uncertain. So we take action based on our expectations of what might happen—thus we speculate to a degree. 8. The reader should find examples here; our discussion included several in the text for you to consider.