Entrepreneurship and local economic resilience: the impact of institutional hysteresis in peripheral places

Cristian Gherhes,Tim Vorley,Nick Williams

doi:10.1007/s11187-017-9946-7

Cristian Gherhes, Tim Vorley + Show 1 more

Open Access

https://doi.org/10.1007/s11187-017-9946-7

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Abstract

This article examines how the legacies of the past in peripheral post-industrial places serve to shape current and future entrepreneurial activity, and with it local economic resilience. Drawing on in-depth qualitative interviews with key regional stakeholders, the article reveals how peripheral post-industrial places are constrained by their histories. This is found to be manifest in different ways, such as low aspirations, generational unemployment and a loss of identity which are in turn compounded by negative perceptions of place and opportunity. These issues culminate in institutional hysteresis at the local level and constrain entrepreneurial ambition. The article argues that the rigidity and reproduction of informal institutions continues to stymie economic resilience and growth. We conclude by reflecting on the implications for entrepreneurship in peripheral post-industrial places as well as with recommendations for policy.

Highlights

One of the key questions in the social sciences is why some local and regional economies are more capable of renewal and transformation than others which remain locked in decline or underperformance (Hassink 2010; Martin and Sunley 2014)
We find that in peripheral post-industrial places (PPIPs) this is the result of rigid informal institutions which culminate in institutional hysteresis at the local level, constraining entrepreneurship and undermining local economic resilience
We find that policy attempts to stimulate entrepreneurial-led growth in PPIPs were hindered by an asymmetry between national and local level institutions, with local level informal institutions being unfavourable to entrepreneurship

Summary

Introduction

One of the key questions in the social sciences is why some local and regional economies are more capable of renewal and transformation than others which remain locked in decline or underperformance (Hassink 2010; Martin and Sunley 2014). Enterprise policy in the UK has been conceived nationally with little sensitivity to local contexts (Huggins and Williams 2011), and achieved little in reducing spatial and socio-economic disparities (Gardiner et al 2013). There has been a widening of the divide between core and peripheral economic places (Mason et al 2015), at the interregional and intraregional level. This highlights the necessarily heterogeneous local responses in adapting to shocks

Results

Discussion

Conclusion