DEVELOPMENT

OF
ENTREPRENEURSHIP
 The evolution of the field of entrepreneurship has
been formulated by scholars based on theories that are
rooted in economics, psychology, sociology, anthropology,
and management.

The CLASSIC contributors are: The MODERN contributors are:

■ Cantillon ■ Drucker
■ Say ■ Hisrich
■ Marshall ■ Timmons
■ Schumpter
■ Shane
■ Knight
■ Kirzner
 The table below provides an overview of the rich historical
knowledge on entrepreneurship using these theories.
The overview consists of six historical periods where the
entrepreneurship contributors or scholars are cited based on
their work.

PERIOD THEORIES AND CONCEPT

Based on the idea that an entrepreneur is a person who
sells goods on behalf of the goods’ owner,
entrepreneurship was exhibit by Marco Polo (1254-
1324), the merchant from Venice who travelled to many
THE EARLIEST PERIOD places in Asia to trade. He would enter into a formal
agreement with a capitalist who sell his goods. He bore
all the risks of possible damage or loss of the goods.
After everything was sold, profits were divided between
the capitalist and the trader as agreed. (OUM, nd)
 PERIOD THEORIES AND CONCEPT

The term entrepreneur was used to describe both

an actor and a person who was in charge of and
managed large production projects. This person
merely managed the projects using the resources
THE MIDDLE AGES provided by the government. In this case, he did
not assume any risks. The entrepreneur in this age
was the person who was in charge of great
architectural works such as public buildings and
cathedrals. (OUM, nd)
 PERIOD THEORIES AND CONCEPT

Entrepreneurship has become associated with risk.

The entrepreneur was someone who would enter
into formal agreement with the government to
provide products or services. It was common
practice to agree on the price as part of the terms
THE 17th CENTURY in the agreement. In effect, the entrepreneur either
reaps profits or bear losses (OUM, nd). A prominent
theorist about this period was Richard Cantillon
(1680-1734), an economist who viewed
entrepreneur as a risk taker and a bearer of
uncertainty.
Richard Cantillon
(1680-1734)
- An Irish-French
Economist
 PERIOD THEORIES AND CONCEPT

The entrepreneur was distinguished from the

capitalist who simply provides money for the
creation of products be sold. Jean-Baptiste Say
(1767-1832), a French economist and
THE 18th CENTURY businessman, described the entrepreneur as a
person who plays a central coordinating role both
in producing and selling goods. He was someone
who coordinates, leads, and manages all the
activities of the firm. (Van Praag, 1999)
Jean-Baptiste Say
(1767-1832)
- A French Economist
and Businessman
 PERIOD THEORIES AND CONCEPT
There was very little distinction between an entrepreneur
and a manager. However, towards the middle of the 20th
Century, Joseph Schumpter (1883-1950), and Austrian-
Hungarian-American economist and political scientist,
refuted the idea of entrepreneurship as the manager of the
firm and espoused the concept of the entrepreneur as
innovator who seeks opportunities and leads “existing
THE 19th AND 20TH means of production into new channels.” “The entrepreneur
CENTURY is neither a risk taker nor a manager or capitalist.” (Van
Praag, 1999; pp. 319-321) Risk and financing is relegated to
the banker or to some other party whose sole aim is to
provide needed capital. On the other hand, it was also during
this period that business expert Peter Drucker (1909-2005),
came up with a behavioral concept of the entrepreneur –
one who actually searches for change, responds to it, and
exploits change as an opportunity (Holden, 2011).
Joseph Schumpeter
(1883-1950)
- Austrian-Hungarian-
American Economist
and Political Scientist
 Peter Drucker
(1905-2005)
- An Austrian-born
American management
consultant, educator,
and author, whose
writings contributed to
the philosophical and
practical foundations of
the modern business
corporation.
 PERIOD THEORIES AND CONCEPT
Hailed as the DotCom era, entrepreneurs in the 21st
century are considered the heroes of free enterprise
(OUM, ND). Creativity and innovation have made
many of these entrepreneurs able to exploit high
growth potentials. “Today, many people regard
THE 21st CENTURY
entrepreneurship as ‘pioneership’ on the frontiers
of business” (Kuratko&Hudgetts, 2004). Much of
the significant changes revolutionizing world of
business was due to the internet which provided
countless opportunities for entrepreneurs..