Nueva Ecija University of Science and Technology

General Tinio Campus, Cabanatuan City

RESEARCH PAPER
IN
IT 34

TITLE: THE GOVERNMENT AND

ENTREPRENEURSHIP

SUBMITTED BY:
Velasquez, Johnmark M.
Agulto, Brylle
De Lara, Arrenz

SUBMITTED TO:
Prof. Rodolfo Soriano
Prof. / Instructor
Preface:
This research paper is a result of extensive research and analysis of various sources, including
academic journals, books, and online resources. The information presented in this paper aims to
inform policymakers and other stakeholders about the critical role that the government can play
in fostering entrepreneurship. This paper is organized into four sections: the first section provides
an overview of the relationship between the government and entrepreneurship, the second
section explores the different roles that the government can play to support entrepreneurship, the
third section discusses the challenges faced by the government in supporting entrepreneurship,
and the final section provides recommendations for policymakers. Providing funding, creating
supportive business environments, and offering training and mentoring programs. The research
will also examine the challenges that governments face in promoting entrepreneurship and
evaluate the effectiveness of their policies and programs.

Acknowledgment:

I would like to express my gratitude to my groupmates, professor, and other experts who have
contributed to this research paper. I also thank the participants who provided their insights and
feedback. Their contributions have been instrumental in shaping the ideas and arguments
presented in this paper.

Introduction:
In underdeveloped economies, the government plays a major and active role in economic
development. Aside from setting up the economic infrastructures, like roads, bridges,
transportation, communication, and electric facilities, the government is directly involved in
business and industry where the private business sector has no or inadequate investment.
However, when the economy has developed, the government has to phase out its economic
activities in favor of entrepreneurs. At this stage, it is the private business sector that becomes the
engine of economic growth. Because it is more efficient and proper. Although entrepreneurs are
risk-takers, self-reliant and optimistic, there are factors that encourage or discourage them to
invest. Obviously, the primary factor or determinant of investment is profit. This is brought about
by several factors like peace and order, the income of the people, electricity, transportation, and
communication facilities.
It is very clear, therefore, that there is a very strong and direct relationship between the
government and entrepreneurship. It is the government that provides the basic incentives for
entrepreneurship. In return, entrepreneurship accelerates economic development through more
employment, production, and consumption. Precisely, this is the goal of the government for the
people. Hence the great interest of the government in the promotion of entrepreneurship. This
chapter presents the role of the government, determinants of investments, and factors of
entrepreneurship. Moreover, the various programs of the government for micro and small
enterprises are outlined,

Body:
Entrepreneurship has been identified as important for economic growth and development. It is a
source of innovation, job creation, and wealth generation. However, starting and running a
business can be challenging, particularly for new entrepreneurs. The government can play a
critical role in supporting entrepreneurship and reducing the barriers to entry.
One of the most important ways in which the government can support entrepreneurship is by
providing funding. Many entrepreneurs struggle to secure the necessary capital to start or expand
their businesses. Governments can provide loans, grants, and other forms of financial assistance
to help entrepreneurs access the capital they need. Governments can also establish venture
capital funds or investor networks to provide equity financing for high-potential startups.
In addition to funding, governments can create supportive business environments. This can
include reducing regulatory barriers and simplifying bureaucratic procedures. Governments can
also provide tax incentives for businesses that invest in research and development or that hire
new employees. Moreover, governments can create business incubators or innovation hubs to
provide entrepreneurs with shared workspaces, mentorship, and access to resources such as legal
and accounting services.
Governments can also offer training and mentoring programs to help entrepreneurs develop the
skills and knowledge they need to succeed. This can include courses in business management,
marketing, and finance. Mentoring programs can provide entrepreneurs with guidance and
advice from experienced business professionals. Such programs can be particularly valuable for
women and minority entrepreneurs who may face additional barriers to starting and growing
their businesses.
While governments can play a critical role in supporting entrepreneurship, they also face several
challenges. One of the main challenges is ensuring that the policies and programs are effective
and efficient. Governments must carefully evaluate the impact of their initiatives and make
adjustments as needed. Another challenge is avoiding unintended consequences. For example,
government funding programs may inadvertently create a culture of dependency or distort
market forces.

Government Assistance Program

Political stability. There is political stability when there is no frequent change in the government,
especially through the use of force or violence. In our country, government policies are not
stable. Every change in administration is also a major change in government policies. This is not
conducive to entrepreneurship. Programs of the government change as soon as a new President
assumes office: There is nothing wrong with change if it is for the Better, But Philippine politics
is different There are many political debits to pay 10 big businessmen who contributed campaign
funds. a result, favoritism creeps into the prejudice or disadvantage of small businessmen who
have no connections.

Prices are stable if there are no abrupt changes or fluctuations in the prices of goods and services
and in the exchange rates. When the value of the U.S. dollar falls, importers are happy, but not
the exporters. When prices keep on increasing, investors are reluctant to do their business.

Taxes. These are needed to fund government projects and programs. However, the payment of
taxes should be based on the ability to pay the scheme. Tax incentives can encourage
entrepreneurs. Many foreign investors choose other countries due to their fair tax programs. A
legal system is a form of additional tax. It is used to expedite transactions in government
agencies.
Infrastructures. These constitute the foundation of economic development. Roads, bridges,
transportation, communication, and electricity are vital to business.
Education and training. It has been said that real development is people development. Money,
machines, land, and material are only productive if people know how to use them properly.
Knowledge and skills are not enough. If product resources benefit only a few, it is not widely
utilized. What is more needed is relevant social values, aside from knowledge and skills. The
Bible says the fruits of the earth should be enjoyed by everyone. The best way to develop the
mind, body, and spirit is through education and training. The school system should infuse into
the minds of students the importance of social responsibility to our productive resources, to our
environment, to our communities, and to our fellow men.
Public administration. Entrepreneurs prefer efficient public administration. In dealing with the
various government agencies, red tape and "expediting fees" are encountered. To put up just a
simple business, there are numerous requirements. Securing such require. ment from various
government agencies take time, not to mention the many fees to pay. Such cumbersome
procedures are naturally very frustrating, especially for those prospective entrepreneurs who are
unschooled. The government should simplify business requirements and place these in just one
office or building. This will save time, effort, and money. In addition, government clerks should
also be efficient and courteous.
Production Technology. Aside from skills training, the government should provide simple
production technology which is accessible to the masses at a nominal price or even free. At
present, the Technology and Livelihood Resource Center (TLRC) has been conducting livelihood
and technology courses for business opportunities for aspiring and practicing entrepreneurs.
Examples of such courses are: how to make fiberglass products, how to operate a pawn-shop,
how to grow bonsai, how to process meat and fish, how to manufacture candles, and many
others. Other non-governmental organizations (NGOs) are also actively engaged in similar
livelihood projects for the benefit of low-income groups.
Conclusion:
In conclusion, entrepreneurship is important for economic growth and development, and
governments can play a critical role in supporting it. Governments can provide funding, create
supportive business environments, and offer training and mentoring programs. However,
governments face several challenges, including ensuring the effectiveness and efficiency of their
policies and programs and avoiding unintended consequences.
As explained earlier, entrepreneurs play a very important role in economic development. They
are the ones who create goods, services, and jobs. Considering our poor economy, there is clearly
a great need for more and more entrepreneurs in our country. Prices of goods are high because
their supply is scarce. Jobs are few because economic activities are also few. Japan and other
industrial countries, experience labor shortages due to so many activities in agriculture, trade,
and industry.
They use machines and import labor from poor countries with labor surpluses. With proper and
adequate assistance programs, our government can develop a larger entrepreneurial economy,
Priorities should be focused on micro and small enterprises. Such mass and community-based
projects utilize local labor, material, management, and techno- logy. Hence the poor masses are
benefitted. The key factor in the development of the Ramos government is people empowerment.
Actually, in a truly democratic society, this is the essence of government. As Lincoln said, à
government is for the people, of the people, and by the people.
The. best way to empower people is 1o improve their knowledge; skills and values. That Rive
them reasonable financial and technical support to Organize and help enterprises. But these are
not the last inputs of the government. The government should likewise provide the necessary
programs in the forms of peace and order; transportation and communication facilities, fiscal and
monetary policies, electricity, and other favorable assistance in order that the people can
productively use their power for their own interests.
The legendary former president of Tanzania, Africa, Julius Nyerere, said: "Development is
people's development of themselves, their lives, their environment Freedom is essential to
development, not just a product of it. But it should not be freedom to exploit. People cannot
develop if they have no power, and development will occur if, and only if, the people can
organize their own power in their own interest."
Government Programs for Entrepreneurs
As stated earlier, both governmental and non-governmental organizations, as well as foreign
agencies, offer financial and technical assistance to micro and small entrepreneurs, particularly
those in rural communities. This portion of the chapter presents several reprints issued by the
Bureau of Small and Medium Business Development of the Department of Trade and Industry.
These materials are not only useful to students but also for others who are interested in setting up
their micro or small businesses. They provide detailed services in the form of loans and skills
training.

Debates on the Role of Government in Entrepreneurship

While governments can play a crucial role in supporting entrepreneurship, there are debates on
the extent of the government's involvement. Some argue that the government should not be
involved in entrepreneurship at all and that entrepreneurship should be left entirely to the private
sector. Others argue that the government should play a more active role in supporting
entrepreneurship, by providing funding, resources, and regulatory support.
Those who argue against government involvement in entrepreneurship believe that the private
sector is better equipped to create new products and services and that government involvement
can stifle innovation. They argue that the government should focus on creating a favorable
regulatory environment, but should not be involved in funding or providing resources to
entrepreneurs.
On the other hand, those who argue for government involvement in entrepreneurship believe that
the private sector cannot provide all the resources that entrepreneurs need to start and grow their
businesses. They argue that the government can play a key role in providing funding, resources,
and regulatory support

Recommendation:
Recommendations for the Government:
Create a favorable business environment: The government can create policies and regulations
that make it easy for entrepreneurs to start and operate businesses, such as simplifying the
business registration process, reducing bureaucracy, and reducing the cost of doing business.
Increase access to funding: The government can provide funding for entrepreneurs through
programs such as grants, loans, and venture capital. Additionally, the government can encourage
private sector investment by offering tax incentives and creating an attractive investment climate.
Promote education and training: The government can provide education and training programs
that equip entrepreneurs with the skills and knowledge they need to succeed in business. This
includes training in areas such as marketing, finance, and technology.
Governments should prioritize funding programs that target underserved and underrepresented
entrepreneurs, including women and minorities.
Governments should establish metrics to evaluate the effectiveness of their policies and programs
and regularly assess their impact.
Governments should collaborate with private sector partners to ensure that entrepreneurship
policies and programs are aligned with market forces.
Governments should invest in research and data collection to better understand the needs of
entrepreneurs and to identify areas where support is most needed.

Recommendations for Entrepreneurship:

Be innovative: Entrepreneurs should strive to develop innovative products or services that solve
problems or meet unmet needs in the market.
Focus on the customer: Entrepreneurs should always put their customers first by listening to their
needs and feedback and incorporating them into their products or services.
Leverage technology: Entrepreneurs should leverage technology to streamline their operations,
reach a wider audience, and create efficiencies in their business processes.
Overall, by creating a favorable environment for entrepreneurship and providing the necessary
support and resources, the government can help foster a thriving entrepreneurial ecosystem that
drives economic growth and job creation. Entrepreneurs, on the other hand, should focus on
innovation, customer satisfaction, and technology to succeed in today's dynamic business
environment.
By taking these steps, policymakers can create an environment that encourages entrepreneurship
and innovation, while avoiding the negative impacts of excessive government involvement.