Entrepreneurship, Innovation and Institutions

Abstract

This paper discusses the nature of entrepreneurship and its relation to innovation along a cycle in which exploration and exploration follow upon each other. We place the roles of entrepreneurship in innovation policy within this cycle of innovation. Different types of innovation along the cycle of innovation are realized with different forms of entrepreneurship, which are constrained or enabled by different legal institutions. One of the key roles of governments is to design, change or destruct institutions in order to improve societal welfare. The question is what governments should do in the context of innovation policy. Here, social scientists can make a contribution by providing insight into what entrepreneurship and innovation is (theories about these phenomena), and how institutions affect them in reality (empirical evidence about their effects). This requires social scientists to be engaged scholars and to provide new policy options as an honest broker between the academic world and the policy world. The key question of this paper is: How can policy best enable innovation based entrepreneurship? The answer is derived from looking at both theoretical tenets and empirical evidence using an institutional design perspective, which aims at providing arguments for the design, change and/or destruction of institutions, given the goals of the governments. We provide an overview of some (empirically tests of) institutions that enable or restrain particular types of entrepreneurship. Examples of these institutions are intellectual property rights and the Small Business Innovation Research program, employment protection, and non-compete covenants.

Entrepreneurial ecosystems in cities: establishing the framework conditions

“…How far geographically will an entrepreneur judge? Given the conceptualisation and physical boundaries of the entrepreneurial ecosystem, scholars advocate the local level appears to be an appropriate aggregate level to many entrepreneurial decision-making and resource accumulation by entrepreneurs (Stam 2014;Stam and Nooteboom 2011;Sternberg 2009;Stuetzer et al 2014). In particular, entrepreneurship at a city-level provides a relevant socioeconomic and institutional context of within the entrepreneurial ecosystem.…”

“…In fact, studies on innovation systems have been missing focus on individual characteristics, personalities and individual's behavior which play an important role in the innovation process and add to a better understanding the entrepreneurial activity (Qian et al 2013). A holistic approach to entrepreneurship has become a new step in the European entrepreneurship policy (Stam and Nooteboom 2011;WEF 2013;Acs et al 2014;Autio et al 2014;Levie and Autio 2014;Ghio et al 2014;Audretsch and Lehmann 2016), focusing on the role of the entrepreneurial ecosystem and the processes of how it is developed, adapted and sustained. Holistic approach advocates researching entrepreneurial activity as an individual behavior of entrepreneurs embedded within a local content (Szerb et al 2013) rather than focusing on entrepreneurial activity in isolation (Wright and Stigliani 2012).…”

Capital humano, redes externas e innovación en la industria colombiana

“…Según Stam & Nooteboom (2011) las actividades de innovación en las organizaciones son un reflejo del conocimiento de la sociedad en la que operan, creando un círculo virtuoso en el que el conocimiento de la sociedad se va enriqueciendo en la medida que las organizaciones lo exploten y generen procesos innovadores. El que el personal profesional en la industria manufacturera colombiana sea en promedio el 16% del personal ocupado, sugiere que la probabilidad de que el conocimiento formal juegue un papel importante en los procesos innovadores es baja aún si se asume (no se conoce a través de la encuesta) que este porcentaje estuviera ocupado en actividades de innovación.…”

Developing start-ups with academic support in Romania

“…As shown in a literature review on entrepreneurship education and entrepreneurs' skills (Almahry, Sarea & Hamdan, 2018), the development of start-ups has many beneficial effects. Fritsch (2013) describes how start-up development accelerates structural change, Stam (2008) reports on innovation and growth, and Boschma (2008) on regional development. Cumming, Johan & Zhang (2014) stated that 1% increase in new business start-up leads to a 24% improvement in the GDP in the subsequent year, also reduce unemployment by 13% and increase export by 3%.…”