R PR UR

CONTINUE WATCHING
WHAT COMES INTO YOUR MIND WHEN YOU HEAR THE WORD

SALIENT FEATURES OF
ENTREPRENEURSHIP
SALIENT FEATURES OF ENTREPRENEURSHIP

-it provides better understanding of the whole aspect.

They also act as the point of reference in determining
whether a particular business is operating within the
realm of entrepreneurship.
SALIENT FEATURES OF ENTREPRENEURSHIP

RISK- TAKING
VENTURE

OPENING AND
ART OF
MANAGING
CORRECT
SELF-OWNED
PRACTICES
BUSINESS

PROVIDING WEALTH-
VALUES TO CREATING
CUSTOMERS VENTURE
ENTREPRENEURSHIP IS AN ART OF CORRECT PRACTICES
-is an art and not a science. It is not governed by fixed and
absolute rules, whereas science is. Thus, there is constant
change which denotes movement and innovation.

-is dynamic by the moment the economic activity changes, the

political, social, and entrepreneurial activities will eventually
change.
ENTREPRENEURSHIP IS AN ART OF CORRECT PRACTICES

-is closely related to creativity. By creativity, there is constant

change or evolution that contributes towards the enhancement
of the enterprise.
NOW ASK YOURSELF THE FOLLOWING QUESTIONS:

1. IS CREATIVITY PRESENT IN THE OPERATION OF

ORDINARY SMALL BUSINESSES ALONG THE STREETS
AND HIGHWAYS AND IN YOUR NEIGHBORHOOD?
2. WILL YOU CONSIDER THE DAILY BUSINESS
PRACTICES OF THE SMALL BUSINESS OWNER WITHIN
THE CONCEPT OF ENTREPRENEURSHIP? WHY?
ENTRENEURSHIP IS A WEALTH- CREATING VENTURE

-This feature sounds simple, but this has been most

misconstrued because of the word wealth. We often hear the
old maxims “HEALTH IS WEALTH” or “KNOWLEDGE IS
WEALTH”.
ENTRENEURSHIP IS A WEALTH- CREATING VENTURE

-Ordinary small business people equate wealth with the

term PROFIT.
In the parlance of accounting, profit represents the
excess income or revenue from the cost and expenses.
ENTRENEURSHIP IS A WEALTH- CREATING VENTURE

-Entrepreneurship, however, is operating within the concept of

wealth creation rather than profit generation.

-According to Random House Webster’s Dictionary, wealth is

defined as the abundance of money, property, or possession.
ENTRENEURSHIP IS A WEALTH- CREATING VENTURE

-The creation of wealth must gradually accelerate and benefit

both the owner and the community. Unless this happens, the
business is not a wealth-creating venture and may remain
where it started. That is why an entrepreneur regularly
evaluates the level of wealth created by the business.
ENTRENEURSHIP IS A WEALTH- CREATING VENTURE

-Wealth is created when the value of the business has

increased abundantly and the life of its owner has improved
considerably. If not, then the business is being managed and
operated not within the framework of entrepreneurship.
ENTRENEURSHIP PROVIDES VALUABLE GOODS AND
SERVICES

-Valuable goods and services highly satisfy the target buyers in

terms of quality and price. The entrepreneur convinces the
consumers that they gain more benefits than what they pay for
the goods and services.
ENTRENEURSHIP PROVIDES VALUABLE GOODS AND
SERVICES

- The entrepreneur defines value from the perspective of the

buyers and not only from his/her own because what is valuable
to the entrepreneur may not be of any value to the consumers.
-Value, therefore, is subjective. Not every person considers the
same things as valuable.
ENTRENEURSHIP ENTAILS OPENING AND MANAGING
THE SELF- OWNED ENTERPRISE
-This feature highlights two important elements: The concept of
opening a self-owned enterprise and the concept of managing it.
-A business is considered self –owned when the person managing
its daily activities is also its owner. This is a straightforward
requirement of entrepreneurship.
INTRAPRENEURSHIP- Business that are being managed by the
others for the benefit of the owners.
ENTRENEURSHIP IS A RISK-TAKING VENTURE
-”RISK IS INHERENT IN AN ENTREPRENEURIAL
VENTURE”
Once an entrepreneurial venture is born because of new ideas
or opportunities, risk comes simultaneously with the venture.
-The risk in entrepreneurship is called business risk.
NOW ASK YOURSELF THE FOLLOWING QUESTIONS:

1. Is your product or service valuable? Why do you say so?

2. From whose perspective is your product or service valuable?
3. How will you make your product or service valuable to your
target market?
LESSON 2.
ACTIVITY TIME

ENTREPRENEURSHIP 12
SALIENT FEATURES OF
ENTREPRENEUR
LESSON ASSESSMENT 2.1
LESSON 2.
Direction: Write TRUE
briefly.
if the statement is correct. Otherwise write FALSE and state your reason

________1. Entrepreneurial principles are fixed in a person’s character.

____________________________________________________________________________________

________2. Creativity and innovation denote a status quo in appearance, procedure, or practice.

_____________________________________________________________________________________

________3. The primary objective of any business endeavor is profit.

_____________________________________________________________________________________
________4. Increase in the level of wealth of the entrepreneur means improvement in his/her economic
status.
_____________________________________________________________________________________

________5. The entrepreneur seeks a wealth-creating venture rather than a profit-generating venture.

_____________________________________________________________________________________
LESSON
ASSIGNMENT: 2.

1. Are you a risk-taker or not?

Why do you say so?
2.How do you face or avoid
risks?
3.What business risks do you
foresee in your future
entrepreneurial venture?
THEORIES ON ENTREPRENEURSHIP
A THEORY IS A GENERALIZATION THAT EXPLAINS A SET OF FACTS OR PHENOMENA. IT IS NOT
AN ABSOLUTE TRUTH. IT CAN BE SUPPORTED BY ANOTHER 0BSERVATION OR PROVEN TO BE
OTHERWISE.

INNOVATION THEORY KEYNESIAN THEORY RISK AND UNCERTAINTY

BEARING THEORY
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ALFRED MARSHALL THEORY
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60 min 48 min
THEORY- is a generalization that explains a set of facts or phenomena.
It is not an absolute truth. It can be supported by another observation or
proven to be otherwise.
OTHER THEORIES ON
ENTREPRENEURSHIP

RISK AND
UNCERTAINTY- INNOVATION THEORY
BEARING THEORY

ALFRED MARSHALL
KEYNESIAN THEORY
THEORY
JOSEPH ALOIS SCHUMPETER
was an Austrian political economist. He later emigrated to the
US and, in 1939, he obtained American citizenship. He was born
in Moravia, and briefly served as Finance Minister of German-
Austria in 1919.
Born: 8 February 1883, Třešť, Czechia
Died: 8 January 1950
Taconic, Salisbury, Connecticut, United States
School or tradition: Historical school of economics
Lausanne School
Spouse: Elizabeth Boody Schumpeter
INNOVATION THEORY

-was contributed by Joseph Schumpeter, an Australian economist

and political scientist. He wrote about it in his book “The Theory
of Economic Development.”
- Schumpeter strongly believed that innovation is the force that will
propel the revolutionary change.
It comes the primary role of the entrepreneur to introduce
innovation in any of the following forms.

1. New Product
2. New Production Method
3. New Market
4. New Supplier
5. New Industry Structure
JOHN MAYNARD KEYNES
1st Baron Keynes CB FBA, was a British
economist, whose ideas fundamentally changed the theory
and practice of macroeconomics and the economic policies
of governments.
Born: 5 June 1883,
Cambridge, United Kingdom
Died: 21 April 1946,
Sussex, United Kingdom
Influenced: Milton Friedman, Paul Samuelson,Paul
Krugman
KEYNESIAN THEORY

-was developed by John Maynard Keynes, a British economist.

The key concepts of the theory were included in his book, The
General Theory of Employment, Interest and Money, which was
published during the Great Depression in 1936.
KEYNESIAN THEORY
-The theory put so much emphasis on the role of the government in
entrepreneurial and economic development, most especially when
the economy was experiencing depression.

- History reveals that the entrepreneurial endeavor was hardly felt

during the Great Depression in the United States since entrepreneurs
were reluctant to invest for fear of having poor returns on investment. It
was the government that played a critical role.
ALFRED MARSHAL THEORY
was the dominant figure in British economics itself dominant in
world economics) from about 1890 until his death in 1924. His
specialty was MICROECONOMICS—the study of individual
markets and industries, as opposed to the study of the whole
economy. In his most important book, Principles of
Economics, Marshall emphasized that the price and output of a
good are determined by both SUPPLY and demand: the two
curves are like scissor blades that intersect at equilibrium.
Modern economists trying to understand why the price of a
good changes still starts by looking for factors that may have
shifted demand or supply, an approach they owe to Marshall.
ALFRED MARSHAL THEORY

-an English economist, was introduced in his book, Principles of

Economics. He strongly asserted that there are four factors in the
production(Land, Labor, Capital, and Organization) of goods and
services in the economy, he considered organization as the
coordinating element.
ALFRED MARSHAL THEORY

-Marshall further suggested that an entrepreneur must be able to

foresee possible changes in the future supply and demand pattern.
He / She must also possess the necessary skills to be an
entrepreneur. Marshall observed that though the skills and abilities
required of an entrepreneur are so numerous, only a few exhibited
a high degree of proficiency.
FRANK HYNEMAN KNIGHT

was an American economist who spent most of his career at the University of
Chicago, where he became one of the founders of the Chicago school. Nobel
laureates Milton Friedman, George Stigler and James M. Buchanan were all
students of Knight at Chicago.
Born: November 7, 1885
White Oak Township, Illinois, United States
Died: April 15 1972
Chicago, Illinois, United States
Contributions: Knightian uncertainty School
tradition: Chicago School of Economics
Education: Cornell University(1913–1916), Milligan College, University of
Tennessee
RISK AND UNCERTAINTY- BEARING THEORY

-Frank Hyneman Knight, an American Economist, conceptualized

the risk and uncertainty- bearing theory of Entrepreneurship in his
book, Risk, Uncertainty and Profit.
RISK AND UNCERTAINTY- BEARING THEORY
-By adopting some concepts of the early economists, Knight
viewed an entrepreneur as an agent of the production process
where he/she connects the producers and the consumers.
Knight considered uncertainty an important factor in the
production of goods and services. He believed that the
entrepreneur must anticipate possible random events to happen
while shouldering the risk at the same time.
OTHER THEORIES ON ENTREPRENEURSHIP
A THEORY IS A GENERALIZATION THAT EXPLAINS A SET OF FACTS OR PHENOMENA. IT IS
NOT AN ABSOLUTE TRUTH. IT CAN BE SUPPORTED BY ANOTHER 0BSERVATION OR PROVEN
TO BE OTHERWISE.

WEBER’S SOCIOLOGICAL THEORY KALDOR’S TECHNOLOGICAL THEORY

LEIBENSTEIN’S GAP FILLING KIRZNER’S LEARNING-ALERTNESS THEORY

THEORY

60 min 48 min
WEBER’S SOCIOLOGICAL THEORY
Theory of Weber asserts that social cultures have significant
contributions to entrepreneurship.

KALDOR’S TECHNOLOGICAL THEORY

The technological theory of Kaldor gives importance to the
advancement of technology as an element of production.
LEIBENSTEIN’S GAP-FILLING THEORY
The gap-filling theory of Leibenstein advocates that
entrepreneurship fills the gap in any economic activity.

KIRZNER’S LEARNING- ALERTNESS THEORY

The learning-alertness theory of Kirtzner focuses on learning
and alertness as the primary attributes of entrepreneurship
 Did you know that the
TRIVIA: “FATHER OF
ENTREPRENEURSHIP” is

FRAN JABARA
LESSON 3.
ACTIVITY TIME

ENTREPRENEURSHIP 12
THEORIES ON
ENTREPRENEURSHIP
LESSON ASSESSMENT 3.1