Exploring country-level institutional arrangements on the rate and type of entrepreneurial activity
TL;DR: In this article, the authors introduce a multidimensional measure of the entrepreneurial environment that reveals how differences in institutional arrangements influence both the rate and the type of entrepreneurial activity in a country.
About: This article is published in Journal of Business Venturing.The article was published on 2013-01-01. It has received 479 citations till now. The article focuses on the topics: Institutional theory & Entrepreneurship.
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TL;DR: In this paper, the authors introduce the concept of National Systems of Entrepreneurship and provide an approach to characterizing them, which are fundamentally resource allocation systems that are driven by individual-level opportunity pursuit, through the creation of new ventures, with this activity and its outcomes regulated by country specific institutional characteristics.
810 citations
TL;DR: In this paper, the authors outline contributions to the entrepreneurial ecosystem approach and conclude with a promising new line of research to our understanding of the emergence, growth, and context of start-ups that have achieved great impact by developing new platforms.
Abstract: In its most abstract sense, an ecosystem is a biotic community, encompassing its physical environment, and all the interactions possible in the complex of living and nonliving components. Economics has always been about systems that explain differential output and outcomes. However, economics has generally ignored the role of entrepreneurship in economic systems, just as entrepreneurship studies have largely overlooked the role of systems in explaining the prevalence and performance of entrepreneurship. The entrepreneurial ecosystem approach has the promise to correct these shortcomings. Its two dominant lineages are the regional development literature and the strategy literature. Both lineages share common roots in ecological systems thinking, providing fresh insights into the interdependence of actors in a particular community to create new value. But studies of both regional development and strategic management have largely ignored the role of entrepreneurs in new value creation. In this paper, we will outline contributions to the entrepreneurial ecosystem approach and conclude with a promising new line of research to our understanding of the emergence, growth, and context of start-ups that have achieved great impact by developing new platforms.
555 citations
TL;DR: This article proposed a re-conceptualization using the constructs External Enablers, New Venture Ideas, and Opportunity Confidence to capture the many important ideas commonly discussed under the "opportunity" label.
531 citations
TL;DR: In this article, the authors focus on regional entrepreneurial ecosystems and offer a complex model of start-ups, Regional Entrepreneurship and Development Index (REDI) and six domains of the entrepreneurial ecosystem (culture, formal institutions, infrastructure and amenities, IT, Melting Pot and demand).
Abstract: This study focuses on regional entrepreneurial ecosystems and offers a complex model of start-ups, Regional Entrepreneurship and Development Index (REDI) and six domains of the entrepreneurial ecosystem (culture, formal institutions, infrastructure and amenities, IT, Melting Pot and demand). Altogether they capture the contextual features of socioeconomic, institutional and information environment in cities. To explain variations in entrepreneurship in a cross-section of 70 European cities, we utilize exploratory factor analysis and structural equation modelling for regional systems of entrepreneurship using individual perception surveys by Eurostat and the REDI. This study supports policymakers and scholars in development of new policies conducive to regional systems of innovation and entrepreneurship and serves as a basis for future research on urban entrepreneurial ecosystems.
480 citations
TL;DR: In this paper, the authors explore the institutional factors that encourage opportunity entrepreneurship in order to achieve higher rates of economic growth and suggest that institutions may not have an automatic effect, as is typically assumed in growth models.
379 citations
References
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TL;DR: In this paper, the authors argue that rational actors make their organizations increasingly similar as they try to change them, and describe three isomorphic processes-coercive, mimetic, and normative.
Abstract: What makes organizations so similar? We contend that the engine of rationalization and bureaucratization has moved from the competitive marketplace to the state and the professions. Once a set of organizations emerges as a field, a paradox arises: rational actors make their organizations increasingly similar as they try to change them. We describe three isomorphic processes-coercive, mimetic, and normative—leading to this outcome. We then specify hypotheses about the impact of resource centralization and dependency, goal ambiguity and technical uncertainty, and professionalization and structuration on isomorphic change. Finally, we suggest implications for theories of organizations and social change.
32,981 citations
Book•
01 Jan 1990TL;DR: Douglass C. North as discussed by the authors developed an analytical framework for explaining the ways in which institutions and institutional change affect the performance of economies, both at a given time and over time.
Abstract: Continuing his groundbreaking analysis of economic structures, Douglass North develops an analytical framework for explaining the ways in which institutions and institutional change affect the performance of economies, both at a given time and over time. Institutions exist, he argues, due to the uncertainties involved in human interaction; they are the constraints devised to structure that interaction. Yet, institutions vary widely in their consequences for economic performance; some economies develop institutions that produce growth and development, while others develop institutions that produce stagnation. North first explores the nature of institutions and explains the role of transaction and production costs in their development. The second part of the book deals with institutional change. Institutions create the incentive structure in an economy, and organisations will be created to take advantage of the opportunities provided within a given institutional framework. North argues that the kinds of skills and knowledge fostered by the structure of an economy will shape the direction of change and gradually alter the institutional framework. He then explains how institutional development may lead to a path-dependent pattern of development. In the final part of the book, North explains the implications of this analysis for economic theory and economic history. He indicates how institutional analysis must be incorporated into neo-classical theory and explores the potential for the construction of a dynamic theory of long-term economic change. Douglass C. North is Director of the Center of Political Economy and Professor of Economics and History at Washington University in St. Louis. He is a past president of the Economic History Association and Western Economics Association and a Fellow, American Academy of Arts and Sciences. He has written over sixty articles for a variety of journals and is the author of The Rise of the Western World: A New Economic History (CUP, 1973, with R.P. Thomas) and Structure and Change in Economic History (Norton, 1981). Professor North is included in Great Economists Since Keynes edited by M. Blaug (CUP, 1988 paperback ed.)
27,080 citations
Posted Content•
TL;DR: In this article, the authors examine the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time.
Abstract: Examines the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time. Institutions are separate from organizations, which are assemblages of people directed to strategically operating within institutional constraints. Institutions affect the economy by influencing, together with technology, transaction and production costs. They do this by reducing uncertainty in human interaction, albeit not always efficiently. Entrepreneurs accomplish incremental changes in institutions by perceiving opportunities to do better through altering the institutional framework of political and economic organizations. Importantly, the ability to perceive these opportunities depends on both the completeness of information and the mental constructs used to process that information. Thus, institutions and entrepreneurs stand in a symbiotic relationship where each gives feedback to the other. Neoclassical economics suggests that inefficient institutions ought to be rapidly replaced. This symbiotic relationship helps explain why this theoretical consequence is often not observed: while this relationship allows growth, it also allows inefficient institutions to persist. The author identifies changes in relative prices and prevailing ideas as the source of institutional alterations. Transaction costs, however, may keep relative price changes from being fully exploited. Transaction costs are influenced by institutions and institutional development is accordingly path-dependent. (CAR)
26,011 citations
Book•
01 Nov 1980
TL;DR: In his book Culture's Consequences, Geert Hofstede proposed four dimensions on which the differences among national cultures can be understood: Individualism, Power Distance, Uncertainty Avoidance and Masculinity as mentioned in this paper.
Abstract: In his bestselling book Culture's Consequences, Geert Hofstede proposed four dimensions on which the differences among national cultures can be understood: Individualism, Power Distance, Uncertainty Avoidance and Masculinity. This volume comprises the first in-depth discussion of the masculinity dimension and how it can help us to understand differences among cultures. The book begins with a general explanation of the masculinity dimension, and discusses how it illuminates broad features of different cultures. The following parts apply the dimension more specifically to gender (and gender identity), sexuality (and sexual behaviour) and religion, probably the most influential variable of all. Hofstede closes the book with a synthesizing statement about cultural values as they are linked to sexuality, gender and religion.
19,826 citations
TL;DR: The centrality of the self-efficacy mechanism in human agency is discussed in this paper, where the influential role of perceived collective effi- cacy in social change is analyzed, as are the social con- ditions conducive to development of collective inefficacy.
Abstract: This article addresses the centrality of the self-efficacy mechanism in human agency. Self-per- cepts of efficacy influence thought patterns, actions, and emotional arousal. In causal tests the higher the level of induced self-efficacy, the higher the perfor- mance accomplishments and the lower the emotional arousal. Different lines of research are reviewed, show- ing that the self-efficacy mechanism may have wide explanatory power. Perceived self-efficacy helps to ac- count for such diverse phenomena as changes in coping behavior produced by different modes of influence, level of physiological stress reactions, self-regulation of refractory behavior, resignation and despondency to failure experiences, self-debilitating effects of proxy control and illusory inefficaciousness, achievement strivings, growth of intrinsic interest, and career pur- suits. The influential role of perceived collective effi- cacy in social change is analyzed, as are the social con- ditions conducive to development of collective inefficacy. Psychological theorizing and research tend to cen- ter on issues concerning either acquisition of knowledge or execution of response patterns. As a result the processes governing the interrelation- ship between knowledge and action have been largely neglected (Newell, 1978). Some of the re- cent efforts to bridge this gap have been directed at the biomechanics problem—how efferent com- mands of action plans guide the production of ap- propriate response patterns (Stelmach, 1976,1978). Others have approached the matter in terms of algorithmic knowledge, which furnishes guides for executing action sequences (Greeno, 1973; Newell, 1973). ,
14,898 citations