Entrepreneurship: Promote Entry BUT also Exit

Schumpeter's "entrepreneurship" revolves around the idea of creative destruction: that endless cycle of competitive firms forcing uncompetitive ones to retire and exit.  In this view, resources will naturally follow those that can innovate better and produce "temporary monopolies" that the market appreciates.  These competitive firms will benefit from their "monopolies" until more innovating players come along and pushes them out of the market.

Schumpeterian entrepreneurship implies then that a healthy economy is one where firms are allowed to enter but also exit.  Supporting uncompetitive firms will distort the cycle of creative destruction and to some commentators, will "stunt" the real value of entrepreneurship to the economy.  In the end, intervening to keep uncompetitive firms afloat prevents the efficiency of the market to allocate resources to more deserving ones.

This is not to say, however, that interventions to push for entrepreneurship must be avoided.  It only means that the interventions, both on firm and sector levels, need to be more conscious of the possible repercussions to the natural efficiencies of the market to choose which firms can multiply resources and value better.  While it has long been established that the market cannot do it alone and fails miserably a lot of time, it has to be admitted (and it has been established empirically too) that it's doing a pretty good job in keeping wasteful firms out of the playing field.