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Entrepreneurial opportunity and related specialization in economic ecosystems

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  • Auerswald, Philip
  • Dani, Lokesh

Abstract

Entrepreneurial ecosystems are most often defined as locally bounded networks of institutions and individuals that help entrepreneurs to identify and exploit market opportunities. However, a prerequisite of the ability to exploit an entrepreneurial opportunity is the existence of the opportunity to begin with. In this paper, we propose an approach to representing how entrepreneurial opportunities are embedded in a regional economy. The central methodological contribution of our paper is to introduce the concept of related specialization, which we define as the concentration of high interdependencies between specialized industries within a metropolitan region, relative to the national level of concentration. We find that related specialization is positively correlated with entrepreneurial outcomes across U.S. metropolitan areas. We use related specialization to make a first attempt at representing the trophic structure of an economic ecosystem. In a biological ecosystem, the trophic structure refers to energy-transfer relationships between different species. As introduced in this paper, we propose the analogy that, in an economic ecosystem, the trophic structure may be mapped in terms of the supply-chain relationships between industries within a region. We argue that these analytic tools can help policymakers more readily understand the opportunities that are imminently available to entrepreneurs in their local environments.

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  • Auerswald, Philip & Dani, Lokesh, 2022. "Entrepreneurial opportunity and related specialization in economic ecosystems," Research Policy, Elsevier, vol. 51(9).
    • Handle: RePEc:eee:respol:v:51:y:2022:i:9:s0048733321002377
    DOI: 10.1016/j.respol.2021.104445
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    Cited by:

    1. Paige Clayton & Maryann Feldman & Benjamin Montmartin, 2024. "Entrepreneurial finance and regional ecosystem emergence," Small Business Economics, Springer, vol. 62(4), pages 1493-1521, April.
    2. Jiyao Chen & Stephen X. Zhang & Erik Lundmark, 2024. "A Quantum view of entrepreneurial opportunity: moving beyond the Discovery and Creation views," Small Business Economics, Springer, vol. 63(4), pages 1539-1553, December.
    3. Feldman, Maryann & Fleming, Lee & Heaton, Sohvi & Desai, Sameeksha & Teece, David, 2022. "Uncommon methods and metrics for local entrepreneurial ecosystems," Research Policy, Elsevier, vol. 51(9).
    4. Shi, Xianwei & Liang, Xingkun & Luo, Yining, 2023. "Unpacking the intellectual structure of ecosystem research in innovation studies," Research Policy, Elsevier, vol. 52(6).
    5. Leonardo Mazzoni & Niccolò Innocenti, 2024. "What conditions favor high-potential entrepreneurship? Unpacking the nexus between the industrial structure and startup typologies," Small Business Economics, Springer, vol. 62(3), pages 1201-1222, March.

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    More about this item

    Keywords

    Economic complexity; Economic ecosystems; Entrepreneurial ecosystems; Related specialization; Supply chains; Trophic structure;
    All these keywords.

    JEL classification:

    • D29 - Microeconomics - - Production and Organizations - - - Other
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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