ROLE OF

ENTREPRENEURSHIP IN
THE ECONOMIC
DEVELOPMENT
Prepared by: RODOLFO R. TURO JR.
Entreprenurship Instructor
 Entrepreneurship Development and Growth
Explained
 Development is process while growth is product. So
growth is the result of development.
 In agriculture, the application of fertilizers, insecticides,
labor, machines and other productive inputs represents a
process or development.
 The results or outputs are crops like rice, corn or sugar.
In simple terms, development is input while growth is the
output.
 Entrepreneurship Development and Growth
Explained
 In economics, development does not only include
economic factors like money, machines and materials,
but also other factors which are non-economic, such as
culture, values, religion, government and education.
 These mixtures of economic and non economic factors
which are applied in the creation of goods and services
constitute economic development.
 Entrepreneurship Development and Growth
Explained

 Clearly, it is not effective to solve economic problems

with economic solutions alone. For instance,
extravagance is not only an economic problem, it also
caused by unfavorable culture or social values.
 Entrepreneurship Development and Growth
Explained
 In poor countries which are usually dominated by poverty,
illiteracy, unjust distribution of wealth, income and power, the
concept of economic development has a more relevant
definition.
 Under the socio economic context, economic development
refers to a progressive process of improving human conditions
by eliminating or reducing poverty, unemployment, illiteracy,
injustice and exploitation.
 Entrepreneurship Development and Growth
Explained
 What are the needs of poor countries?
• More economic activities through operations
of factories, agricultural productions, trade
and service industries.
• Economic activities multiply jobs and
income.
 Entrepreneurship Development and Growth
Explained
 Social justice must also prevail. How?
 There should be fair distribution of wealth,
income and power.
 Unfortunately, it is almost impossible to
redistribute wealth in poor countries.
 Entrepreneurship Development and Growth
Explained
 The land reform programs are failures,
because there was no political will on the
part of top government officials who
obviously prefer to sustain the existing
socio-economic order.
 Entrepreneurship Development and Growth
Explained
 In view of the very limited access to economic
opportunities by the masses, a better option is to
develop an entrepreneurial class. With the strong
support of the government and the private sector,
small scale enterprise can flourished the country
side.
 Entrepreneurship Development and Growth
Explained

 Community-based projects can generate jobs and

incomes for the poor. This is all what they need to
uplift their social economic conditions.
 Development and Growth Theories
 Laissez Faire Theory
This is means economic freedom. It explains
that the government should not interfere in economic
activities. It is absolute free-enterprise economy. The
role of the government is only confined in education,
justice and public works. It is beneficial to the
economy.
 Development and Growth Theories
 Keynesian Theory
The government should play the key role in
economic development, particularly in less developed
countries, or those with depressed economic conditions. It
contends that during economic depression, the
government should put up a massive public works, like
constructions of roads and bridges and other labor
intensive projects.
 Development and Growth Theories
 Ricardian Theory
He believe that the key factor in economic
growth is land. This means that agriculture plays a
major role in economic development. People cannot
live without food and natural resources. Hence the
importance of land or agriculture is specified.
 Development and Growth Theories
 Harrod-Domar Theory
The key factor in economic growth is physical
capital like machines. The theory claims that more
products can be produced through the use of machines. In
other words, production is more efficient with the use of
machines. This theory appears to explain the industrial
success of rich countries.
 Development and Growth Theories
 Kaldor Theory
This theory explains that the application of modern
technology in the production of goods and services has been
responsible for the economic success of highly developed
countries. In case of Japan, it can raise vegetables without the
use of soil. Only fertilized water are used. Such technology
has been exported to the Middle East where the agricultural
land are scarce.
 Development and Growth Theories
 Innovation Theory
This was developed by Joseph Shrumpeter.
He stresses the role of innovators or innovators in
economic development. He says that it is the innovator
who has he courage and imagination to handle old
systems, and be able to transform theory into reality. It is
the innovator who introduces change for the better.
 Development and Growth Theories

 Non Economic Theories

there are several other theories which are
non-economic in nature, their key factors are
political stability, efficient public administration,
open society and positive cultural values.
 Contributions of Entrepreneurs
1. Develop new markets
2. Discovers new sources of materials
3. Mobilize capital resources
4. Introduce new technologies, new industries,
and new products
5. Create employment
 Participation of Women
 Most women in underdeveloped or poor
countries are engaged in unproductive activities.
They help in farms. Economic contributions are
insignificant.
 Women constitute a big portion of the total
population. Their exclusion from productive
enterprises is a great economic loss. .
THANK YOU!