Republic of the Philippines

DEPARTMENT OF EDUCATION
Region I
Schools Division Office of Pangasinan II
Binalonan, Pangasinan

ENTREPRENEURSHIP
First Quarter - Week 1 Module 1

https://www.google.com/search
 Republic of the Philippines
DEPARTMENT OF EDUCATION
Region I
Schools Division Office of Pangasinan II
Binalonan, Pangasinan

OVERVIEW & RELEVANCE

of
ENTREPRENEURSHIP

Prepared by:

EMERENCIANA H. SALAPARE
SHS Teacher II
 TABLE OF CONTENTS

Module 1: OVERVIEW AND RELEVANCE OF ENTREPRENEURSHIP

Cover Page……………………………………………… 1

Title Page……………………………………………….. 2

Table of Contents………………………………………. 3

Overview……………………………………………….. 4

Pre-assessment…………………………………………… 4-5

Lesson 1: Overview of Entrepreneurship……………… 5-9

Meaning of entrepreneurship and entrepreneur

Origin of Entrepreneurship

Evolution of the Term Entrepreneurship

Lesson 2: Relevance of Entrepreneurship……………… 9-10

Relevance of Entrepreneurship to Students

Relevance of Entrepreneurship to the Economy

The Socio-economic Benefits from Entrepreneurship

Formative Assessment………………………………….. 10

Answer Key…………………………………………….. 11-12

References………………………………………………. 13
Module 1

OVERVIEW
This module provides you with an overview of entrepreneurship, wherein we defined the
meaning of entrepreneurship and entrepreneur from its origin until such time that these words
evolved. It tackles also the key concepts, underlying principles and core competencies in
entrepreneurship for you to become independently create a quality products/services in
entrepreneurship when you enter on it. It also shows how important entrepreneurship is - to
you as a students and to the national economy, and its benefits to the socio-economic growth
of the country.

Learning Competency
The learners:
1. Discuss the relevance of the course.

Learning objectives:
At the end of the module, the learners must be able to:
1. define key terms in entrepreneurship;
2. trace the history of entrepreneurship;
3. discuss briefly the evolution of entrepreneurship; and
4. discuss the benefits of entrepreneurship to the students, to the national economy, and
its socio-economic benefits.

LESSON 1: OVERVIEW OF ENTREPRENEURSHIP

Meaning of Entrepreneurship and Entrepreneur

Entrepreneurship is…

• The act of creating a business or businesses while building and scaling it to generate a
profit.
• An important driver of economic growth and innovation.
• Putting up a business and assuming all risks.
• In the simplest sense, refers to the ability of an individual to determine and come up with
the proper combination of the resources available in his environment and transform this
into an output of either goods or services, and obtain a fair profit at the price the
entrepreneur sets. (Azarcon 2008)
 An entrepreneur is…

• A person who sets up a business with the aim to make a profit and creates a new
business, bearing most of the risks and enjoying most of the rewards.
• An innovator, a source of new ideas, goods, services, and business/or procedures.
• Playing a key role in any economy, using the skills and initiative necessary to anticipate
needs and bring good new ideas to market.

From the definitions given above, there are several factors used by an entrepreneur to turn his
idea into a profitable product. An idea is the first and foremost investment of an entrepreneur
because this is where it started a clear plan of action. In other words, this is the clear blueprint of
an entrepreneur’s mind. Therefore, the uncertainty of the success of a new idea makes
entrepreneurs more significant risk takers compared to typical business owners. So, entrepreneurs
are more likely innovators because they come up with new product or service. That is why they
are also considered as visionaries. Raw materials are the basic inputs that the entrepreneur uses
to come up with his products. Capital, refers to the buildings, machinery, equipment and tools
used the process of production. These things is generally called a production plant. In order to
meet the production process an entrepreneur should hires laborers. Therefore, having all these
things allows entrepreneurs to have what is called business enterprise. When these inputs are
turned into an outputs or what we call finished products, then an entrepreneur brings these
finished products to his market. A market is the buyers and users of the product. These people
who buy the product are called customers; while people who are product users are called
consumers or end user.

All entrepreneurs can be considered as business owners, but

not all business owners can be considered as entrepreneurs.
(DIWA Learning 2016)

What Have I Learned So Far?

Direction: Answer the following questions:
1. Define entrepreneurship in your own words.
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2. Enumerate and explain briefly those key terms in the definition of entrepreneurship.
________________________________________________________________________
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 ________________________________________________________________________
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ORIGINS OF ENTREPRENEURSHIP
It is not really clear where entrepreneurship began. Though the term originated from the
French. In the earliest historical accounts of entrepreneurs and entrepreneurial activities are
traced to the great adventurer Marco Polo (1271-1295), who made the practice of selling his
goods to a moneyed person with both of them signing a contract.
Richard Cantillon (1680-1734), a well-known economist and author in the 17th century.
He is the one who introduced the term entrepreneur to the world, that’s why some considered
him as a father of the Theory of Entrepreneurship. He also viewed entrepreneurs as risk-takers,
and defined the entrepreneur as the “agent who buys means of production at certain prices in
order to combine them into a new product.”

Shortly thereafter, the French economist Jean Baptiste Say (1767-1832), added to
Cantillon’s definition by including the idea that entrepreneurs had to be leaders. He claimed
that an entrepreneur is one who brings other people together in order to build a single
productive organism.

In the next century, a British economists like Adam Smith (1723-1790), David Ricardo
(1772-1823), and John Stuart Mill (1806-1873), briefly touched on the concept of
entrepreneurship, broadly referring to the English term as “business management.” But the
writings of Smith and Ricardo likely undervalued the significance of entrepreneurship, Mill’s
writings stresses the significance of entrepreneurship for economic growth, and claimed that
entrepreneurship requires “no ordinary skill,” ad there is no good equivalent English word to
encompass the specific meaning of the French term entrepreneur. Adam Smith maintained that
economic development was due to a phenomenon known as the Invisible Hand Theory. This
theory states that business ventures and nations will develop to a particular direction without
necessitating the effort nor the desire of the capitalist, thereby espousing the thought that
economic development is but a natural thing that comes about. This master plan of economic
development was otherwise known as the Law of Nature.

Another economist, Alfred Marshall (1842-1924), first formally recognized the necessity
of entrepreneurship for production in 1890 which is “Principles of Economics.” Marshall
asserted the four factors of production: land, labor, capital, and organization and replaced by
the term entrepreneurship.
 Other economists in the innovation school of thought claim that entrepreneurs have special
skills that enable them to participate in the process of innovation. Along this line, Harvey
Leibenstein (1922-1994), claims that the dominant and necessary characteristics of
entrepreneurs is being gap-fillers.

In the 19th century, Joseph Schumpeter (1883-1950), espoused the idea that entrepreneurs
are innovators and developers of untried technology. David McClelland (1917-1998),
maintained that productivity is dependent upon the energy levels of people, and that
entrepreneurs are energetic and productive. He also espoused the idea that entrepreneurs are
moderate risk-takers.

Management guru Peter Drucker (1909—2005) emphasized the idea that entrepreneurs
are people who look for and maximize opportunities. Albert Shapiro argued that
entrepreneurs take initiatives, organize some social and economic mechanism and accept risks
of failure.

Throughout the evolution of entrepreneurship theory, different scholars have offered varied
theories on entrepreneurship, and the entrepreneurs different and common characteristics. By
combining the schools of thought cited above, one can establish a clearer understanding of
entrepreneurship and economic development.

EVOLUTION OF THE TERM ENTREPRENEURSHIP

Let us now take a look at how this course of study evolved over the years. Below is a
summary of various economists’ view of entrepreneurship, including the year they
conceptualized this view.
CONTRIBUTOR AND YEAR OF CONTRIBUTION TO
CONTRIBUTION ENTREPRENEURSHIP THOUGHT
Jean Baptiste Say (1800) Entrepreneurship refers to the shifting of
economic resources out of an area of lower and
into higher productivity and greater yield.
Carl Menger (1871) Entrepreneurship involves obtaining
information, calculation, an act of will and
supervision.
Joseph Schumpeter (1910) Entrepreneurship is, in its essence, the finding
and promoting new combinations of
productive factors.
Harvey Liebenstein (1970) Entrepreneurship is the reduction of
organizational inefficiency.
Israel Kirzner (1975) Entrepreneurship is the identification of
market arbitrage opportunities.
Albert Shapiro (1975) Entrepreneurship involves a king of behaviour
that includes initiative taking, organizing and
recognizing, social mechanism to turn
resources and situations to practical account,
and the acceptance of risks and failures.
Karl Vesper m(1980) Entrepreneurship is the dynamic process of
creating incremental wealth.
W. Ed Mc Mullan and Wayne A. Long Entrepreneurship is the building of new growth
(1990) organization.
Howard Stevenson (1992) Entrepreneurship is the pursuit of opportunity
beyond the resources currently under one’s
control.
Jeffrey Timmons (1994) Entrepreneurship is the ability to create and
build a vision from practically nothing.
Peter Drucker (1998) Entrepreneurship is the process of starting
one’s own, new and small business. It is also
the process of innovation and new venture
creation through four major dimensions –
individual, organizational, environmental,
process-aided by collaborative networks in
government, education and institutions.
Robert Hisrisch (2001) Entrepreneurship involves the creation
process, requires the devotion of the necessary
time and effort, assumes the accompanying
financial, psychic and social risks, and receives
the resulting rewards of monetary and personal
satisfaction and independence.

LESSON 2: RELEVANCE OF ENTREPRENEURSHIP

Relevance of Entrepreneurship to Students (https://www.marlborough.org)

1. Entrepreneurship education teaches students crucial life skills that will help them
navigate uncertain future.
2. Entrepreneurship education encourages creativity, innovation and collaboration.
3. Entrepreneurship education teaches students to identify problems they have never
encountered before.
4. Entrepreneurship helps students to develop “grit.”
5. Entrepreneurship helps students to become ready to create their own future and to
change the world.

Relevance of Entrepreneurship to the Economy (https://www.investopedia.com)

1. Entrepreneurship make productive use of various resources present in the economy.
2. Entrepreneurs provide employment opportunities to various individuals.
3. Entrepreneurship is the backbone of the economy that add to national income.
4. Entrepreneurs innovate goods and services and to create social change.
5. Entrepreneurs give prestige to the country.
6. Entrepreneurs are risks takers, risks that society will otherwise be hesitant to take.

Socio-economic Benefits from Entrepreneurship (https://apacentrepreneur.com)

1. Promote self-help and employment
2. Provide taxes to economy
3. Empowers individual
4. Enhances national identity and pride
5. Enhances competitive consciousness
6. Improves quality of life
7. Enhances equitable distribution of income and wealth
8. Mobilizes capital
Assignment: Conceptualize your future business plan which you can work on as we discuss our
next lesson and later you may venture into after finishing this subject. (Note: Use separate sheet
of paper.)

Formative Assessment
Directions 1: Read each phrase or statement below and complete the phrase to make it a complete
statement by filling in the blanks with the correct answer. Look for the answers in the box of
letters provided below. You can move up, down, left, right and diagonally to spell out the words
and write these answers on the appropriate spaces corresponding to its description.

1. The act of creating a business or businesses while building and scaling it to generate a
profit is called ________________________________.
2. An innovator, a source of new ideas, goods, services and business or procedure is an
_________________________________.
3. Raw materials and capital is generally called ___________________________.
4. A master plan that says that economic development is a natural thing that comes about is
known as the ______________________________.
5. ___________________________ argued that entrepreneurs take initiative, and accept
risks of failure.

E Q W E R T Y U I O P A S D F G
H N J K L Z X C V B N M N B V C
E N T R E P R E N E U R S A Z X
D F G R H J K L P O I U Y T R E
A D A M E S M I T H M A R C O D
J E A N R P B A P T I S T E G Y
S Y A L B E R T S H A P I R O U
M A N A G E M E N T S T U A R T
I I M L A W O F N A T U R E O E
T D R A D I C R A E T E B N M C
H E K B A L P R O D U C T U A H
J A E O P L V E N T U R E H R N
O Y T R T I E N D U S E S K E O
H T Y I N N O V A T O R S H R L
N Q B U S I N E S S O P L Y I O
P R O D U C T I O N P L A N T P

Directions 2: In your own words, give what is being asked in the items below.

ITEMS ANSWER
1. Give three a.
importance of
entrepreneurship b.
to students.
c.

2. Give three a.
relevance of
entrepreneurship b.
to the economy.
c.

3. Give three socio- a.

economic
 benefits from b.
entrepreneurship.
c.

References:
A. Books
Boado, S.A.(2017). Applied Economics. Makati City, Philippines: Diwa Learning
Systems Inc. page 109
Azarccon, E.R.S.(2008).Entrepreneurship Principles and Practices. Baguio City:
Valencia Educational Supply. Page 7-16
B. Online and Other Sources
http://www.googlecom./search

http://www.reference.com meaning of entrepreneurship

https://www.investopedia.com meaning of entrepreneurship
https://www.researchgate.net/publication/287208107_Evolution_of_Entrepreneurship_theorie
s_through_different_schools_of_thought/citation/download

https://www.marlborough.org/news/~board/stem/post/five-benefits-of-entrepreneurship-
education-to-students

https://apacentrepreneur.com/role-of-entrepreneurship-in-socio-economic-growth-of-a-
country/