nep-ent New Economics Papers
on Entrepreneurship
Issue of 2006‒12‒04
nine papers chosen by
Marcus Dejardin
Facultes Universitaires Notre-Dame de la Paix

  1. Entrepreneurship by circumstances and abilities: the mediating role of job satisfaction and moderating role of self-efficacy By Wong, Poh Kam; Lee, Lena; Leung, Aegean
  2. Antecedents for Entrepreneurial Propensity: Findings from Singapore, Hong Kong and Taiwan By Lee, Lena; Wong, Poh Kam; Chua, Bee Leng; Chen, Jennifer
  3. How does An Entrepreneur’s Ability Influence the Propensity to Exploit Novel Opportunities? The Moderating Role of Personality and Environment By Lee, Lena; Wong, Poh Kam
  4. Entrepreneurship and market order: Some historical evidence By Bitros, George; Minoglou, Ioanna
  5. Entrepreneurship and Economic Theory By Khalil, Elias
  6. Entrepreneurship Policy in Estonia By Kuura, Arvi
  7. Cluster dynamics and innovation in SMEs: the role of culture By Callegati Enrico; Grandi Silvia
  8. Open Innovation Clusters: The Case of Cova da Beira Region (Portugal) By Leitao, Joao
  9. Venture capitalism as a mechanism for knowledge governance By Antonelli Cristiano

  1. By: Wong, Poh Kam; Lee, Lena; Leung, Aegean
    Abstract: Prior studies have found that job dissatisfaction and self-efficacy are significant factors influencing individuals’ entrepreneurial propensity. Existing literature on entrepreneurship often regards job dissatisfaction as an entrepreneurial push factor and self-efficacy as an entrepreneurial pull factor. The argument is that individuals who are dissatisfied with their jobs are more likely to seek alternative mode of employment such as self-employment. In other words, poor job circumstances may push individuals to leave their paid employment to start their own businesses. On the other hand, personal abilities such as self-efficacy may pull individuals toward starting their own businesses in areas where they are confident and competent in. Despite the importance of job dissatisfaction and self-efficacy for new venture creation, few if any studies have examined the entrepreneurial phenomena from a holistic perspective. Utilizing concepts from the P-E fit and self-efficacy literatures, this paper argues that the path to entrepreneurship is a multi-faceted interactive process between individuals’ personal attributes and their work environment. We specifically examined how IT professional’s personal attributes such as innovation orientation and self-efficacy condition individuals for an entrepreneurial career in unsatisfactory work environments.
    JEL: M2
    Date: 2006
  2. By: Lee, Lena; Wong, Poh Kam; Chua, Bee Leng; Chen, Jennifer
    Abstract: The existing literature identifies a number of antecedent factors that positively influence the propensity of individuals to become entrepreneurs. Key among these are self-efficacy, prior knowledge of other entrepreneurs and perception of opportunities. At the same time, policy makers commonly identify fear of failure as a major deterrent factor for entrepreneurs taking the entrepreneurial plunge. This paper examines the relative impacts of these antecedents and deterrent factor on entrepreneurial propensity, defined as the likelihood of starting one’s own business in the three East Asian newly-industrialised economies (NIEs) of Singapore, Hong Kong, and Taiwan. We also test for possible differences in the variables effects on opportunity vs. necessity entrepreneurial propensities. Our findings highlight significant location differences among the variables in the case of overall, opportunity and necessity entrepreneurship. Finally, we discuss the relevant policy implications from our findings.
    Keywords: Entrepreneurial Propensity; Self-Efficacy; Perception of Opportunities; Prior Knowledge of other Entrepreneurs; Fear of Failure; East Asia
    JEL: M2
    Date: 2005
  3. By: Lee, Lena; Wong, Poh Kam
    Abstract: While prior research has examined the influence of entrepreneurs’ ability and personality on entrepreneurial behavior separately, our study’s contribution is to confirm their joint effects, as well as their interaction effects with the dynamism of the environment on entrepreneurs’ opportunity exploitation behavior. Our study’s findings are consistent with the emerging opportunity-exploiter nexus framework of Shane and Venkataraman, which posits that the rate and nature of entrepreneurial exploitation activities are jointly determined by the nexus of environmental factors that shape the emergence of opportunities and the supply of opportunity-seekers with the right entrepreneurial personalities and abilities to exploit such opportunities. Specifically, we found that highly critical entrepreneurs who are high in extraversion, agreeableness, openness to experience, independence, and emotional stability have higher propensity to exploit novel opportunities in uncertain environments.
    Keywords: Personality; ability; opportunity exploitation
    JEL: M2
    Date: 2006
  4. By: Bitros, George; Minoglou, Ioanna
    Abstract: Our objective here is to establish the proposition that creative entrepreneurship gives rise to a market order which is optimally adjusted to facilitate the introduction and the diffusion of innovations, particularly those that take the form of new markets, new organizational schemes, new management devices and new methods and means of doing business. To substantiate this claim we extract from the existing historical literature and employ the ideal type entrepreneurial method of the Greek diaspora network. The interpretation we offer is that this method showed a high degree of operational flexibility and institutional adaptability and that it is these two proper-ties that explain its marked tenacity over time. The key ingredient for its success is traced to the self-regulatory robustness of the network, which was secured by the commitment of its partners to a moral order based on the triptych of ‘trust, reliability and reciprocity’ as well as to their ac-ceptance in advance of the sanctions in case of transgressions. Moreover, the embeddedness of the branches of the network in the Greek communities abroad, called Paroikies, where the Greek Orthodox Church provided moral leadership and maintained the community ties, reinforced the adherence of network partners to the rules of ethical business conduct. But in our view the domi-nant force in the design of the core mechanism that made the Greek diaspora network such a suc-cess was entrepreneurship.
    Keywords: Entrepreneurship; Institutions; Networks; International Business Organizations
    JEL: N84 L22 N83 L14
    Date: 2006–10–24
  5. By: Khalil, Elias
    Abstract: Let us define entrepreneurship as creativity and the evolution of novelty. Let us suppose, the main thesis of the chapter, that entrepreneurship is an action that does not differ from everyday action such as walking, driving, or chewing gum. If the definition and supposition are granted we can conclude that the theory of everyday action, such as walking or chewing gum, is one and the same as the theory of evolution. The conclusion is definitely strange if not extraordinary. It is based on a subtle but subversive thesis: There is no difference between everyday action and creativity or evolution. This conclusion is extraordinary only because it goes against the dominant dogmas in economics (i.e., neoclassical theory) and evolutionary biology (i.e., neo-Darwinian theory). Both dogmas draw a radical divide between action and evolution. For neo-Darwinian theory, action is phenotype ultimately determined by genotype—while the genotype evolves according to another mechanism. For neoclassical economics, action is determined by rational calculation of the efficient allocation of given resources—while resources evolve according to another mechanism. To undermine the radical divide between the theory of action and the theory of evolution, this chapter shows how everyday action—from walking, fetching water, to fishing—is entrepreneurial at first level of approximation—and hence should be the basis of the theory of evolution.
    Keywords: Action; Evolution; neo-Darwinism; neoclassical theory; Austrian Economics; classical economics; Alfred Whitehead; John Dewey.
    JEL: D29 D20
    Date: 2006–10–13
  6. By: Kuura, Arvi
    Abstract: The main task of this article is to explore the entrepreneurship policy in Estonia. The idea proceeds from the book by Lundström and Stevenson (2001), in which the authors describe, analyse and discuss the development of entrepreneurship policy in ten economies — six EU Member States and four members of APEC. In some respects, this article strives to be a “missing chapter” in the aforementioned book concerning entrepreneurship policy in Estonia. It should be considered as an attempt to apply their approach to a country without a long history in SME development. The article starts with an overview of the theoretical background and goes on to examine entrepreneurship policy (or even economic policy) in Estonia. Examination of SME / entrepreneurship policy documents shows that Estonia is moving towards entrepreneurship policy, but with certain minor reservations. The current Estonian entrepreneurship policy may be regarded as a combination of an extension to SME policy and a holistic policy, the trend of development is towards the latter. The “old” (effective in 2002–2006) policy was almost SME policy and has been mentioned as a basis in the new (for 2007–2013) policy document, which is being prepared now. The policy structures followed the vertical model in the period 1996–2000 (and also earlier), but now Estonia is moving towards a horizontal or multi-ministerial model.
    Keywords: Entrepreneurship; Entrepreneurship Policy
    JEL: L53
    Date: 2006–02
  7. By: Callegati Enrico; Grandi Silvia
    Abstract: The territorial agglomeration of interdependent enterprises has a positive influence on the competitiveness, the performance and the development of national economies. This is a widely accepted intuition in economie theory, and it dates back to the works of Alfred Marshall. In particular, these phenomena have been depicted through the theoretical framework of the "IndustriaI Districts". Another signifieant impulse to the debate was provided by the GREMI (Groupe de Recherche Européen sur les Milieux Innovateurs), through the concepì of milieu innovateur. Later, Michael Porter's studies and dissemination works granted great visibility to the dynamics of agglomeration of industries, which since then afe better known among policy makers as "clusters". At any rate, the importance of the cultural element in the concepts of "cluster", milieu, and "district" is undeniable. This is evident also when observing the phenomenon from a historieal perspective. Evidence shows that the strength of a loeal economie system, and its eapacity to grow and 10 innovate, afe closely related 10 the pattern of knowledge (thus cultural) stratifieation, to the territory itself and to learning eapacity. Moreover, one can observe that cultural socio­economie elements afe embedded in technology, thus they play a key role when considering the dynamics of innovation process and growth opportunities for Small and Medium Enterprises (SMEs). With this respect, the paper wìll present some relevant case studies of technical assistance earried out by in the field of industriai cooperation with several non-ED Mediterranean countries. In particular, the paper will present those case studies where initiatives were sei up with a view 10 encourage cluster dynamics in regions (i.e. Aleppo, Syria or Yazd, Iran), where the main sector of activity (textile and clothing industry) is his1orically and culturally based. In particular, several factors were involved, such as the cohesion of stakeholders for the creation of innovation, the development of new products, and the competìtive advantages for the loeal productìve system. The project approach and its conclusions confirm the fundamental role of culture and culture-based activities in the process of economie development, especially when considering SMEs, where culture represents both an embedded strategie foundatìon for the creation of cluster dynamics, and a signifieant potential for their future development affecting innovation trajectories.
    Date: 2005–03
  8. By: Leitao, Joao
    Abstract: This paper aims to reveal the role played by open innovation schemes in the development of new competitive advantages. Furthermore, it aims to present a normative model for networking knowledge clusters, that is, traditional clusters that are applied to the case of the Cova da Beira region (Portugal) such as Agro-Food, Textile, and Public Sector; and a set of emergent clusters that include Bioscience, Biotechnology, Multimedia, Tourism, Health, and Knowledge. In this paper, the basic framework about clusters was expanded, taking as reference the studies of Porter (1985, 1990, 1998, 2005), Feldman (1994), Porter and Stern (2001), and Furman, Porter and Stern (2002). The problematic related to open innovation schemes is integrated in this framework in order to reveal the importance of building new kinds of open innovation networks that don’t involve the geographic concentration of the enterprises. After making a literature review in order to present the analytical framework that includes the clusters theory, a normative model is presented through the development of a case study applied to the Cova da Beira region (Portugal). This option is due to the existence of a local University that has historically interfaced the launching of open-innovation spin-offs into local and international clusters networks. The present paper reveals a high degree of originality, since it contributes to the introduction of the concept of open innovation into the literature about clusters. The main point is that open innovation provides two main implications to build up and leverage both internal and external knowledge into international clusters networks. First, this study presents a basic implication for several agents such as, entrepreneurs, researchers, and policy makers; that is, universities are principals in interfacing the sources of open innovation and the transfer of processes of knowledge into the international clusters networks. Second, it promotes the inclusion of the issue related to the creation of international and institutional networks in the short agenda of the referred agents in order to promote the introduction of new open innovation schemes.
    Keywords: Clusters; Entrepreneurship; Institutional Networks; Open Innovation.
    JEL: R3 M13 R11 M20
    Date: 2006–10–16
  9. By: Antonelli Cristiano (University of Turin)
    Abstract: Venture capitaIism-an outcome of the ICT Revolution, which made its appearance first in the US during the late 1970s and early 1980s and then in other countries including Israel during the 1990s-, explains the new pervasive role of smaIl firms in the introduction of technologicàl innovations. We elaborate the interpretative hypothesis that venture capitalism is based upon the identification of economies of scope in the transactions of technological knowledge bundled with managerial competence, reputation, screening procedures and equity and transformed into knowledge-intensive property rights that are traded in new specialized financial markets. We argue that this model is part of a broader change in national system of innovation of advanced countries, and it is a powerful mechanism for the production, dissemination and integration of knowledge in advanced capitalistic economies, and thereby a main driver of 'knowledge-based' growth.
    Date: 2006–04

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