ENTREPRENEURSHIP h) AIM degree looks at entrepreneur in this

MODULE 2 context:
Prof. Jezreel Pattaguan  Opportunity finder who sees a need, assess the
situation, ventures a risk to fulfill the need and makes a
OUTLINE profit
• The Filipino Entrepreneurship  Innovator who creates new products and services or
• The Challenge to Entrepreneurs expands existing markets
• Entrepreneurship and Philippine Education  Facilitates enterprise productivity, push sales thru
• Theories that Explain How Economies Grow schemes and strategies
• Socioeconomic Impact and Benefits from Entrepreneurship  Driven by a strong desire to be successful and consumed
• Who Benefits from Entrepreneurship?
by motivation to excel
THE FILIPINO ENTREPRENEUR
THEORIES THAT EXPLAIN HOW ECONOMIES GROW
• Influenced by both Spanish and American
1. General explanations of economic development
• Entrepreneurship is essentially starting a business of his own, new
Economic growth as an inevitable process brought about by
and small-scale business - Peter Drucker
interacting forces in nature
• Entrepreneurship means or refers to that of being engaged or
•Economic development proceeds according to a master plan
starting in small and medium enterprises (SMEs) or establishing
or "Law of Nature in 1932, Oswald Splengler explained
and managing a business of his own
economic development by likening a culture or society to a
living organism that grows, lives and dies. Herbert Spencer
THE CHALLENGE TO ENTREPRENEURS viewed society as an organism constantly in the process of
•Be able to compete in a "Borderless World” evolution
•Before, local producers compete with local companies, now, they have
to compete with International, Multinational and Giant corporations • Economic development is brought about by an "Invisible
present in the local market Hand". According, to Adam Smith, while individuals seek to
•Challenge to cast out "colonial mentality" work for their own goals, they unknowingly promote what is
•"Borderless World" should not be taken as a threat but an opportunity best for all, it is as if these individuals were led to such actions
•Challenge to create EXPORT QUALITY products by an "invisible hand" to the interest of the society. That any
**There are available incentives and support from government and society can be made to prosper with little or no intervention
business groups from the government.
•Information Technology, Cyberspace and information highway
**Must be closely watched for its benefits can be exploited by • Economic development is brought about by "Cultural
entrepreneurs Diffusion". Societies have been involved in different social
•3rd millenium posts a great challenge to business minded persons with or cultural experiments in various economic, political,
entrepreneurial orientation. religious or social aspects of life. That as one culture that has
•There is room for innovation, ventures creation, strategic position and begun to use a new technique interacts with another that has
business alliances not been exposed to the technique, the former is able to
•No more room for traditional management systems influence the latter to discard old ways and adopt new ones.

ENTREPRENEURSHIP AND PHILIPPINE EDUCATION • Racial heritage determines the economic development of
a people. Some individuals including Hitler contend that racial
characteristics makes some people more energetic, thus
allowing their countries to be far more developed than others.

• Climatic conditions determine the energy levels of a

people and in turn its rate of development. Ellsworth
Huntington in his observations and studies led him to
conclude that extremes of temperature as well as high
fluctuations of climatic conditions would have a detrimental
effect on the energy levels of people in the countries
experiencing such climatic extremes.

• The challenge of the natural environment is

responsible for the rise of civilization. A.J. Toynbee traces
a) Schools train students for employmentship unmindful of the economic and cultural changes to a combination of natural
benefits of entrepreneurship (geographic) phenomena and socio-psychological pressure of
b) Some schools, who now include entrepreneurship in their stimuli such as new soils to exploit. The challenge of the
curriculum, now calls for a paradigm shift environment is responsible for the rise of civilization.
c) Entrepreneurship is an alternative to college education -
Brother Andrew Gonzales (DLSU)
o "The country's drop-out rate in elementary, secondary and Economic explanations for development
college education is very high. Of the 100 students, only • Explains economic development as a rational process brought about
about 48 graduate. Of this number, only 26 enroll and only when men respond to opportunities in the environment so as to promote
16 earn a degree" their own self-interest or material welfare. As a result, he increases
o Not necessarily bad because many drop-outs did good, even productivity and wealth not only for himself but also for society as a
better than college graduates. whole.
d) DepEd created the Bureau of Non-Formal Education
e) Institutions like DLSU, PSBA, PLM, PCU, NTC and TUP offered Adam Smith, David Ricardo and Karl Marx identified various economic
courses leading to specialization on entrepreneurship factors influencing economic growth.
(reading task)
f) AIM opened its Asian Center for Entrepreneurship, an These factors formed the many basis of many theories of economic
innovative masteral degree program itself with combined growth.
classroom sessions and workplace.
g) AIM Program is anchored on: Socio-psychological explanations
 Self-mastery -control of self to control one's • Entrepreneurship for economic development. Joseph Schumpeter
environment observed that economic development progressed unevenly and in
 Situation Mastery - assess situations and find sudden leaps, initiated by men who wanted to promote "new goods and
opportunities where other see problems new methods of production or to exploit a new source of materials or a
 Enterprise Mastery - techniques of developing the new market".
enterprise from birth to maturity
Schumpeter's entrepreneur is an individual driven by noble motives
and therefore differs from the early economists' rational self- motivated
capitalist. Schumpeter's view exalted and dignified the entrepreneur's
role in the economic development process

• Sociological factors in economic development.

Sociologists explain economic growth in terms of social or cultural
values, norms and other structures that differentiate modern from
traditional economists.

• Psychological factors in economic development. Psychologists view

economic growth as a product of individual human behaviour, that is,
of a person's decisions, thoughts and actions. It is assumed that all
these are manifestations for conscious or sub- conscious motives of
needs.

SOCIOECONOMIC IMPACT AND BENEFITS FROM

ENTREPRENEURSHIP
• Entrepreneurs have proven over and over again to be the pioneers
who convert ideas into products and dreams into reality. Entrepreneurs
bend creativity, innovation and risk taking with hard work to form and
nurture new ventures

• Entrepreneurs - and entrepreneurship culture as well - is now regarded

as a potent force and a recognized sector of the economy and one that
is to be relied upon given its number and the magnitude of contribution
it provides to a country.

1. Creates employment and promote self-help. Spirit

and culture of self-help, self-reliance, and self-sufficiency among
citizens is addressed. Entrepreneurs help government provide
employment for himself and others.

2. Improves quality of life -entrepreneur's penchant

(desire) for innovation and development of new product, new
technology and creation of new market redounds to the
betterment of products and services - hence the quality of life

3. Enhances to a more equitable distribution of

income and wealth and therefore eases social unrest- with
entrepreneurs succeeding in their respective endeavors - chances
are the equitable distribution of income

4. Utilizes and mobilizes resources and capital to

make the country productive- every entrepreneur utilizes capital,
idle capital now are mobilized in the economy which means more
business options and more income.

5. Brings social benefits through the government

through taxes to the economy - every entrepreneur contributes to
the economy a kind of income out of real estate, income tax, sales
tax, fees and all other forms of payment to government.

6. Empowers individuals - the real indicator of

economic well-being among citizens in some ways are gauged by
the amount of financial resources. Because of high income of
entrepreneurs, the possibility of wealth accumulation is enhanced.

7. Enhance competitive consciousness - innovation

being the essence of entrepreneurship is a catalyst to a
consciousness and culture of competition which in the long term
breeds global competitiveness.

8. Creates new markets - markets are people who

are willing and able to satisfy their needs (called the effective
demand). Entreprenerus can create customers or buyers.

9. Discover new sources of materials. Due to the

innovative nature of entrepreneurs, they persist on discovering
new sources of materials to improve their enterprise

WHO BENEFITS FROM ENTREPRENEURSHIP?

1. The entrepreneur
2. Those who purchase the entrepreneur's product
3. Those who provide resources to the entrepreneur
4. Those who are employed by the entrepreneur
5. Society as a whole