Entrepreneurial economics is the study of entrepreneurs and entrepreneurship within the economy. Accumulation of factors of production by itself does not explain economic development. Entrepreneurial economics also deals with the role of entrepreneurs, and the nature and scope of entrepreneurship in the economy. It covers a number of economic and non-economic theories about the characteristics and behavior of entrepreneurs. Government policies to increase the number of entrepreneurs in the economy and social entrepreneurship related to economic development are also considered. Entrepreneurship, especially small and medium-sized enterprises, represents the most important economic branch of every country, including the Republic of Croatia. It is a sector that creates the largest amount of GDP through its work, firstly through production, and then through the sale of all products and services. If there are no entrepreneurs, there is no entrepreneurial system, and in Croatia, a series of causes has led to the fact that we have a chronic lack of entrepreneurial activity. Although there are many obstacles to the development of entrepreneurship in the Republic of Croatia, several problems were highlighted when analyzing the issue. Thus, first of all, it is necessary to encourage greater activity of people to start their own business through information. Next, we must improve the administrative procedures for establishing and running a company, and ultimately improve the consulting (education and guidance) activities of entrepreneurs in all stages of the development of their business.