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Measuring the Modern Entrepreneur: An Evaluation of Elon Musk

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The Entrepreneurial Ecosystem

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Abstract

Bosanquet qualitatively considers various arguments that characterize the entrepreneurial profile of Elon Musk. This chapter first contemplates entrepreneurship in an effort to develop baseline standards by which we might then evaluate Elon Musk. A secondary analysis compares Elon Musk against two of his predecessors, Henry Ford and Kiichiro Toyoda. Likewise, the author compares Tesla Motors with Ford Motor Company and Toyota Motor Corporation. Several accusations against Elon Musk will also be weighed, especially those which might challenge notions of Musk as an innovator, founder, and (ultimately) entrepreneur.

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Notes

  1. 1.

    Molly Ball, Jeffrey Kluger, and Alejandro de la Garza, “Time 2021 Person of the Year: Elon Musk,” Time, December 13, 2021, https://time.com/person-of-the-year-2021-elon-musk/.

  2. 2.

    Tesla, “Elon Musk,” November 15, 2022, https://www.tesla.com/elon-musk. Musk’s online bio opens simply with the assertion that “Elon Musk co-founded and leads Tesla, SpaceX, Neuralink and The Boring Company.” This bio had not been updated to reflect Musk’s acquisition of Twitter on October 27, 2022. The summary did, however, note prior affiliations, sharing that “Previously, Elon co-founded and sold PayPal, the world’s leading Internet payment system, and Zip2, one of the first internet maps and directions services.” The word entrepreneur is noticeably absent from Musk’s 559-word online bio on the Tesla.com official website.

  3. 3.

    Search performed on November 15, 2022.

  4. 4.

    Musk-as-entrepreneur seems a fait supposé. Notably, entrepreneur.com authors who hype Musk qua entrepreneur often attach flattering qualifiers, e.g., Randy Garn’s “genius, visionary, futurist” entrepreneur (May 2021), Jessica Thomas’s “billionaire” entrepreneur (Sep. 2020), Manish Dudharejia’s “the most successful” entrepreneur (Nov. 2017), Carolyn Sun’s “serial” entrepreneur (Sep. 2016), et al. Further, entrepreneur.com offers readers the opportunity to “[be inspired and learn] from the likes of Elon Musk” in its ‘Celebrity Entrepreneurs’ section, https://www.entrepreneur.com/living/celebrity-entrepreneurs.

  5. 5.

    William J. Baumol, Robert E. Litan, and Carl J. Schramm, “Entrepreneurship and Growth: A Missing Piece of the Puzzle,” in Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity, New Haven: Yale University Press, 2007, p. 3. http://ebookcentral.proquest.com/lib/gmu/detail.action?docID=3420392.

  6. 6.

    Ibid.

  7. 7.

    Siri Terjesen and Ning Wang, “Coase on Entrepreneurship,” Small Business Economics 40, no. 2 (February 2013), p. 179. https://doi.org/10.1007/s11187-012-9468-2. Coase and Wang effectively echo Schumpeter’s own perspective on economic development qua phenomena. See also Joseph A Schumpeter, The Theory of Economic Development, translated by Redvers Opie, Routledge Classics, New York: Routledge, 2021, p. 55. Schumpeter argues that “development…is defined by the carrying out of new combinations.” He elaborates upon such new combinations, i.e., Schumpeter lists the following specific examples: (1) “the introduction of a new good” or an existing good of “new quality;” (2) “the introduction of a new method of production;” (3) “the opening of a new market;” (4) the conquest of a new source of supply; and (5) “the new organization of any industry,” e.g., “the creation of a monopoly… or the breaking up of a monopoly position.”

  8. 8.

    Zoltan J. Acs, Saul Estrin, Tomasz Mickiewicz, and László Szerb, “Entrepreneurship, Institutional Economics, and Economic Growth: An Ecosystem Perspective,” Small Business Economics 51, no. 2 (August 2018), p. 502. https://doi.org/10.1007/s11187-018-0013-9.

  9. 9.

    Ross Levine and Yona Rubinstein, “Smart and Illicit: Who Becomes an Entrepreneur and Do They Earn More?” The Quarterly Journal of Economics 132, no. 2 (May 1, 2017): p.965. https://doi.org/10.1093/qje/qjw044.

  10. 10.

    Terjesen and Wang (2013), p. 174.

  11. 11.

    William J. Baumol, “Entrepreneurship: Productive, Unproductive, and Destructive,” Journal of Political Economy 98, no. 5, Part 1 (October 1990): p. 897. https://doi.org/10.1086/261712.

  12. 12.

    Levine and Rubinstein (2017), p. 965.

  13. 13.

    Joern H. Block, Christian O. Fisch, and Mirjam van Praag, “The Schumpeterian Entrepreneur: A Review of the Empirical Evidence on the Antecedents, Behaviour and Consequences of Innovative Entrepreneurship,” Industry and Innovation 24, no. 1 (January 2017): p. 71. https://doi.org/10.1080/13662716.2016.1216397.

  14. 14.

    Ibid.

  15. 15.

    Esteban Lafuente, Zoltan J. Acs, Mark Sanders, and László Szerb. “The Global Technology Frontier: Productivity Growth and the Relevance of Kirznerian and Schumpeterian Entrepreneurship.” Small Business Economics 55, no. 1 (June 2020): p. 155. https://doi.org/10.1007/s11187-019-00140-1.

  16. 16.

    Ibid.

  17. 17.

    Ibid.

  18. 18.

    Ibid.

  19. 19.

    Block et al. (2017), p. 71.

  20. 20.

    Baumol et al. (2007), p. 3.

  21. 21.

    Baumol (1990), p. 915.

  22. 22.

    See David B. Audretsch and Maryann P. Feldman. “R & D Spillovers and the Geography of Innovation and Production.” The American Economic Review 86, no. 3 (June 1996): 630–640. https://www.jstor.org/stable/2118216.

  23. 23.

    Joseph A Schumpeter, The Theory of Economic Development, translated by Redvers Opie, Routledge Classics, New York: Routledge, 2021, p. 55.

  24. 24.

    Richard L. Florida, The Rise of the Creative Class: Revisited, 2019 edition, New York, NY: Basic Books, 2019, p. 6.

  25. 25.

    Ibid.

  26. 26.

    Ashlee Vance, Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future, First edition, New York, NY: HarperCollins Publishers, 2015, p. 14.

  27. 27.

    Elon Musk, “Risky Business.” IEEE Spectrum 46, no. 6 (June 2009): p. 40. https://doi.org/10.1109/MSPEC.2009.4977610.

  28. 28.

    Elon Musk, “Once a Physicist: Elon Musk,” as interviewed in Physics World 20, no. 3 (March 2007), p. 50. https://doi.org/10.1088/2058-7058/20/3/39.

  29. 29.

    Ibid.

  30. 30.

    Ibid.

  31. 31.

    Solar City was founded by Elon Musk’s cousins. He funded their venture and advised them on their start-up. SpaceX later acquired Solar City despite the objections of shareholders. In May 2022, SpaceX and Musk won a lawsuit brought by those shareholders who objected to the acquisition. See Isobel Asher Hamilton, “How Elon Musk Transformed His Cousins’ Solar Panel Company into Tesla Energy, Which Has Faced Lawsuits from Angry Shareholders and Consumers,” Business Insider, April 29, 2022. https://www.businessinsider.com/solarcity-tesla-energy-beleaguered-history-elon-musk-2021-7.

  32. 32.

    Vance (2015), p. 150.

  33. 33.

    Ibid.

  34. 34.

    Ibid., p. 153.

  35. 35.

    Ibid., pp. 153–154.

  36. 36.

    Ibid., pp. 148–149.

  37. 37.

    Ibid., p. 150 and 154.

  38. 38.

    Tesla, “About,” May 15, 2022, https://www.tesla.com/about.

  39. 39.

    Fred Lambert, “Elon Musk Says JB Straubel Should Have Been Tesla’s Only Other Cofounder, Dredging up the Past,” Electrek, April 14, 2022. https://electrek.co/2022/04/14/elon-musk-starting-tesla-not-just-jb-straubel-worst-business-decision/.

  40. 40.

    Tesla, “Elon Musk,” November 15, 2022, https://www.tesla.com/elon-musk.

  41. 41.

    Vance (2015), p. 157.

  42. 42.

    Ibid., pp. 156–158.

  43. 43.

    For a timeline of SpaceX, visit https://abcnews.go.com/Technology/timeline-spacexs-trek/story?id=16224465.

  44. 44.

    Vance (2015), p. 160.

  45. 45.

    Ibid.

  46. 46.

    Ibid., p. 161.

  47. 47.

    Taylor Locke, “Elon Musk: ’I Really Didn’t Want to Be CEO of Tesla’—Here’s How He Says It Happened,” CNBC, January 30, 2020. https://www.cnbc.com/2020/01/30/elon-musk-i-really-didnt-want-to-be-ceo-of-tesla.html.

  48. 48.

    Thomas K. McCraw and Richard S. Tedlow, “Henry Ford, Alfred Sloan, and the Three Phases of Marketing,” in Creating Modern Capitalism: How Entrepreneurs, Companies, and Countries Triumphed in Three Industrial Revolutions, edited by Thomas K. McCraw, Cambridge, Massachusetts: Harvard University Press, 1997, p. 272.

  49. 49.

    Ibid.

  50. 50.

    Ibid.

  51. 51.

    Ibid., pp. 267–268.

  52. 52.

    Ibid., p. 272.

  53. 53.

    Ibid., p. 273; Ford also innovated “the moving assembly line, which became fully operational by 1914,” p. 274.

  54. 54.

    Ibid.

  55. 55.

    Ibid., p. 274.

  56. 56.

    Ibid., p. 275.

  57. 57.

    Ibid., p. 276.

  58. 58.

    Jeffrey R. Bernstein and Thomas K. McCraw, “Toyoda Automatic Looms and Toyota Automobiles,” in Creating Modern Capitalism: How Entrepreneurs, Companies, and Countries Triumphed in Three Industrial Revolutions. Cambridge, Massachusetts: Harvard University Press, 1997, pp. 406–408.

  59. 59.

    Ibid., p. 407.

  60. 60.

    Ibid., pp. 407–408.

  61. 61.

    Ibid.

  62. 62.

    Ibid., p. 408.

  63. 63.

    Ibid.

  64. 64.

    Ibid.

  65. 65.

    Ibid., p. 410.

  66. 66.

    Ibid.

  67. 67.

    Ibid., p. 407.

  68. 68.

    Ibid., p. 408 and p. 403, respectively.

  69. 69.

    Ibid., p. 410.

  70. 70.

    McCraw and Tedlow (1997), p. 275.

  71. 71.

    Ibid.

  72. 72.

    Bernstein (1997), pp. 411–413.

  73. 73.

    Locke (2020).

  74. 74.

    Ibid.

  75. 75.

    Ibid., p. 17. As Acs et al. (2009) explain, “entrepreneurship contributes to economic growth by acting as a conduit through which knowledge created by incumbent forms spills over to agents who endogenously create new firms.”

  76. 76.

    Ibid., p. 18.

  77. 77.

    McCraw, Thomas K. “Introduction.” In Creating Modern Capitalism: How Entrepreneurs, Companies, and Countries Triumphed in Three Industrial Revolutions, edited by Thomas K. McCraw, 1–16. Cambridge, Massachusetts: Harvard University Press, 1997.

  78. 78.

    Ibid. See also Holcombe (1998) and Kirzner (1976) under references. Holcombe (1998) explains that “incorporating entrepreneurship into the framework of economic growth…[shows] the nature of increasing returns to scale,” on p. 60.

  79. 79.

    Ibid., p. 7.

  80. 80.

    Acs, Z., “Economics, Entrepreneurship, and Public Policy,” lecture on January 20, 2022, George Mason University.

  81. 81.

    Notably, despite the research and design start as early as 1930, Kiichiro Toyoda would not see this particular dream bloom until 1947. See Bernstein (1997), pp. 413–414.

  82. 82.

    Patrice Onwuka, “Elon Musk’s Philanthropy and Donor Privacy,” Philanthropy Roundtable (blog), March 24, 2022. https://www.philanthropyroundtable.org/elon-musks-philanthropy-and-donor-privacy/.

  83. 83.

    Giving Pledge, “Press Release—The Giving Pledge,” April 19, 2012. https://givingpledge.org/pressrelease?date=04.19.2012.

  84. 84.

    Eliza Haverstock, “Here’s Where Elon Musk’s $5.7 Billion Gift Likely Went,” Forbes, February 15, 2022. https://www.forbes.com/sites/elizahaverstock/2022/02/15/elon-musk-reports-donating-57-billion-to-charity-but-there-is-no-trace-of-that-gift-yet/.

  85. 85.

    Ibid. According to Haverstock, “The Mercatus donation was intended for ‘Covid-19 scientific research,’ per the Musk Foundation’s tax filing.”

  86. 86.

    Ibid.

  87. 87.

    Ibid.

  88. 88.

    Steven Muegge and Ewan Reid (2019), p. 19.

  89. 89.

    Ngram counts reflect mentions within the extensive digitized Google Books collection, specifically.

  90. 90.

    Much remains to be determined regarding Elon Musk’s leadership of, control over, and decision making concerning his most recent acquisition, Twitter.

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Authors and Affiliations

  1. Schar School of Policy and Government, George Mason University, Arlington, VA, USA

    Camilla Bosanquet

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  1. George Mason University, Arlington, VA, USA

    Zoltan J. Acs

  2. Business School, Costa Rica Institute of Technology (ITCR), Cartago, Costa Rica

    Esteban Lafuente

  3. Faculty of Business and Economics University of Pécs, Pécs, Hungary

    László Szerb

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Bosanquet, C. (2023). Measuring the Modern Entrepreneur: An Evaluation of Elon Musk. In: Acs, Z.J., Lafuente, E., Szerb, L. (eds) The Entrepreneurial Ecosystem. Palgrave Studies in Entrepreneurship and Society. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-25931-9_10

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