E n t r e p r e n e u rs h i p a n d

Economic Development

 Economic development is a scheme aimed at

improving the living standards of the nation’s
citizenry. To achieve economic development goals,
proper management of the following elements is
necessary:
1.human resources (labor supply, education,
discipline, motivation);
2.natural resources(land, minerals, fuel, climate);
3.capital formation (machines, factories, roads);
and
4.technology (science, engineering, management,
entrepreneurship).
Entrepreneurship refers to
the economic activity of a
person who starts,
manages, and assumes the
risk of a business
enterprise.
 The entrepreneur is a person who under
takes entrepreneurial activities.
 The Entrepreneur identifies an
economic needs, considering offering a
business solution,
-proceed to assemble the resources
required,
-assumes the risk of either succeeding
or failing.
Entrepreneur’s Problem at hand Entrepreneur’s action
concern
1.Identify an economic 1.High income families 1.Stablished a high
need. are not satisfied with school education with
the service provided by higher standard than
high schools in there the current high schools
area. are providing.
2.Assembling 2.Aquired funds hire
resources required. 2.Resources must be people construct
made available. building and the like.
3.Assuming risk. 3.Prepare project study
3.Venture must be advertise maintained
made good relationship with
employees, costumer
among others
 The Entrepreneur can assume his assign
raw in the development as the economy a
review of a contribution of entrepreneurs
will reveal that no business big or small
without the hand of entrepreneur. Even if
many of this Businesses failed to
survived still a sizeable number
developed and succeeded to the capitalist
economy a viable concerned.
1. Product and services for costumer and
producer.
2. Employment;
3. Taxes;
4. Demand for supplies’ products and services;
5. Training facilities for future entrepreneurs.
 Land Labor Capital
(Natural Resources) (Human Resources) (Financial)

Entrepreneur

Production
Process

Finished Goods
and Services
1. To supply the necessary capital;
2. To organize production by buying
and combining inputs like materials
and labor;
3. To decide on the rate of output, in
the light of his expectation about
demand; and
4. To bear the risk inherent to the
venture.
 Innovation – is a introduction of a
new method, procedure, custom,
device, among others.

 Entrepreneurship – is the group of

persons who perform the
entrepreneurial activities.
1. New product;
2. New process of production;
3. Substitution of a cheaper material in an unaltered
product;
4. Reorganization of production, internal function, or
distribution arrangement leading to increased
efficiency, better support for a given product, or
lower cost; or
5. Improvement in instruments or method of doing
innovation.
a. Invention – discovery or devising of new
products and processes;
b. Development – process by which the ideas
and principles generated from the stage of
invention.
c. Innovation – actual introduction of a new
product or process.
1. Cordless microphone;
2. Microwave oven;
3. Cellular phone;
4. Kung fu fight scenes developed by Bruce Lee in
the movies;
5. Karaoke music appliance;
6. Use of Laser in the treatment of eye conditions;
and
7. Use of computers by engineers and architects in
the design of buildings.
A new venture cannot remain as such
forever. The entrepreneur must
develop into a small business or make
it grow into a mature and bigger
company if he is to recoup the cost of
opening a new venture and take
advantage of the opportunities
presented by a mature business.
1. Prestart-up stages;
2. Start-up stage;
3. Early growth stage; and
4. Late growth stage.
Happens when the entrepreneur starts to
question the feasibility of an idea,
product, or service. He seeks answers to
questions regarding potential markets,
production, and financing. This is a very
important stage that the entrepreneur
must consider. If he errs in his
evaluation, he will fail before
considerable growth is attained.
1. Formation of the business;
2. Generation of necessary capital;
3. Purchase of facilities and equipment;
4. Constructing prototype products; and
5. Testing the market.
Follows after establishing feasibility.
Activities will be on a small, i.e., selling
to the limited markets with limited
resources. If losses occur, it will
naturally be limited also. If the
enterprise is successful at this stage,
the option to move to the next stage
can be exercised.
The final stage before the new venture
matures into a stable enterprise. This is
when management is structured, long-
term financing is established, and
facilities planning are undertaken. This
is also the stage where the skills of the
entrepreneur are less needed. Instead,
the skilled manager begins to take over.
 Factors of Limiting Factor for
Economic Reward
Production Rewards Received
• Land • Rent • Supply and
demand
• Capital • Interest • Industry
rates/government
mandated rates
• Supply and
• Labor • Wages/salary
demand
legislation
• Skill of
• Entrepreneur • Profits entrepreneur
 Entrepreneur 1 Entrepreneur 2 Entrepreneur 3

• Year 1 introduce • Inactive • Inactive

innovative
product
• Year 2 reap • Introduce innovative • Inactive
moderate product
profits
• Reap • Introduce innovative
• Year 3 maximize moderate profits product
profits
• Maximize profits
• Year 4 profits
• Profits decline • Reap
decline
moderate
profits
• Year 5 introduce
• Maximize profits
innovative
product
Entrepreneurship means running a
small business. New business
ventures, however, can also be
undertaken on a large scale. Both
small and large businesses are
confronted by problems that are
entrepreneurial in nature.
1. Offering business services during
Sundays and holidays;
2. Manufacture and sale of new
products; and
3. Selling on a deferred payment
scheme.