Innovation Networks & High-Growth Entrepreneurship

Abstract

We explore the role of regional innovation networks (RINs) in facilitating high-growth entrepreneurship (HGE). Building on the knowledge spillover theory of entrepreneurship, we theorize that RINs serve as a conduit for the spillovers of complex knowledge from inventors who create it to entrepreneurs who seek to exploit it through the creation of innovative ventures. We further theorize that the relationship is stronger in regions with stronger external innovation networks, more entrepreneurs, and greater venture capital availability. Using a novel longitudinal dataset covering 358 U.S. MSAs over period 2003-2014, we find evidence that RINs can be crucial for spurring high-growth potential ventures, and that the effect of RINs on HGE is conditional on the entrepreneur rate.