Entrepreneurial Ecosystem Narratives and the Micro-Foundations of Regional Entrepreneurship

Abstract

Entrepreneurial ecosystems, the set of forces that generate and sustain regional entrepreneurial activity, are a growing focus of scholars and practitioners. Studies are beginning to draw attention to the role of cultural artifacts, including narratives, in the functioning of entrepreneurial ecosystems. However, the mechanisms driving narratives’ effects on ecosystem participants are unexamined. The purpose of this paper is to develop theory that explains the influence of entrepreneurial ecosystem narratives on how audiences process information. It is theorized that differences among ecosystems can, in part, be explained by differences in the properties of the narratives that take hold in them. Specifically, propositions are developed about four properties that represent sources of variation among ecosystem narratives: their ability to capture attention, influence the cognitive and emotional encoding of information, and be memorable. Further, it is argued that the maturity of the entrepreneurial ecosystem influences the novelty and potency of narrative effects. By integrating theories of cognitive and social psychology, narrative theory, and entrepreneurship, this paper advances our understanding of how narratives about entrepreneurial ecosystems influence audiences.