How Economic Development Influences Entrepreneurial Networks-Dissecting Reasons for the Birth, Development and Death of Local Development’s Agents

Abstract

This case study will reflect upon the experience of important agents for local development—the Local Productive Arrangement (APL) composed by South American companies in the sector of wedding parties. This work will then reflect how Economic Development creates—but also may destroy—entrepreneurial networks. Data were observed by interviews with 30 businessmen participating in the Local Productive Arrangement. In 2009, the APL received support from Brazilian Service of Support to Micro and Small Companies (SEBRAE), which has been supporting several APL since 2002. However, starting in 2012, membership and motivation began to diminish, and in 2014, despite efforts made by the association’s president, the board decided to close it. This experience motivates several insights about how an entrepreneurship network evolves because this case study has been a pioneering case in Brazil. The analysis of the case offers an observation of the benefits of creating the association as well as the difficulties and challenges involved in the initiative.