Schumpeterian Entrepreneurship Research Articles

Entrepreneurial Ecosystems for Kirznerian and Schumpeterian Entrepreneurship in an Emerging Economy

Entrepreneurial Ecosystems for Kirznerian and Schumpeterian Entrepreneurship in an Emerging Economy

Entrepreneurial Ecosystems for Kirznerian and Schumpeterian Entrepreneurship in an Emerging Economy

Entrepreneurial Ecosystems for Kirznerian and Schumpeterian Entrepreneurship in an Emerging Economy

Why Are There So Few Schumpeterian Entrepreneurs from China? Understanding the Factors That Influence Entrepreneurial Opportunity Evaluation from a Comparative Culture Perspective

Opportunity evaluation is a very important part of entrepreneurial activity; however, entrepreneurs’ individual differences in evaluating opportunities have been neglected in prior research. To address this gap, we apply institutional theory and stereotype threat theory to explain how some institutional factors differentiate entrepreneurs’ opportunity evaluation process. More specifically, we explore how external institutional factors, such as political and social factors, along with personal institutional factors, such as family influences, affect the opportunity evaluation of entrepreneurs under various cultural backgrounds, specifically China and the United States. The Schumpeterian entrepreneur, in which radical innovation and the desire to significantly upend market equilibria, frames our discussion. This paper contributes to the theoretical understanding of the factors influencing entrepreneurial opportunity evaluation from a comparative culture perspective and to the comparative international entrepreneurship field by building a comparative evaluation framework that summarizes institutional factors influencing Chinese and American entrepreneurs’ opportunity evaluation. We propose that policy, social value, and belief as well as family will have significant impacts on entrepreneurs’opportunity evaluation. We further propose several cultural constructs such as individualism vs. collectivism, uncertainty avoidance, and Confucian work dynamism will moderate the relationship with institutional factors in influencing an entrepreneur’s opportunity evaluation process. We discuss our implications with attention given to how our comparative evaluation framework provides insights into why China and the United States differ in terms of developing Schumpeterian entrepreneurs. We then discuss the framework’s limitations.

Catalysing Financial Inclusion in South Africa's Rural Landscape: A Theoretical Discourse of PoS Business Model

In countries like South Africa, where cash plays a pivotal role in social and economic life, limited access to financial institutions, in rural areas has led to significant economic challenges for citizens and businesses. This limitation has further exacerbated the financial exclusion of the underserved population resonating with poor economic growth. In addressing the issue, this desktop-based theoretical discourse, draws on the Technology Acceptance Model, Schumpeterian Entrepreneurship Theory, and Circular Flow of Income Model to conceptualise cash point-of-sale business model, as an innovative mechanism with the potential to spearhead the country’s financial inclusion efforts, entrepreneurial imperatives and local economic participation. The findings provide valuable insights for policymakers and financial institutions to design and implement effective financial inclusion policies in rural areas. By addressing unique challenges faced by rural communities, such as limited infrastructure and lower levels of education, a more inclusive and resilient financial ecosystem can be achieved, contributing to broader social and economic development goals in South Africa's rural landscape. An exploratory empirical study is further recommended to pave the way for the development of a contextual framework to guide the model’s implementation in South Africa.

Une fabrique publique d’entrepreneurs schumpétériens en France (1971-1978)

Une fabrique publique d’entrepreneurs schumpétériens en France (1971-1978)

Schumpeterian entrepreneurship: coveted by policymakers but impervious to top-down policymaking

Differentiating various types of entrepreneurs provides clues to the puzzle of why vertical or top-down policies often fail to create Schumpeterian entrepreneurship and the ecosystems where it thrives. Schumpeterian entrepreneurship is intrinsically contrarian, whereas public policy has a bias toward incremental innovation and replication of past success. If central planners knew what the next radical innovation would be, there would be no need for Schumpeterian entrepreneurs. Schumpeterian entrepreneurs create not only companies but also institutions in the entrepreneurial support system. These ever-evolving structures are too complex to design, and central planning instead reduces the space for organic institutional innovation.

Entrepreneurship and the systemic consequences of epidemics: A literature review and emerging model

The Covid-19 epidemic is a global challenge requiring adequate public and private responses to overcome the emergency, shape new development trajectories, and prepare for future outbreaks. As socioeconomic turning points, epidemics imply an entrepreneurial response in which not only managers and entrepreneurs, but also policymakers, health professionals, and civil society as a whole are active participants. Using the PRISMA methodology, we provide a comprehensive review of the complex interactions between entrepreneurship and epidemics over time. Applying a combined Kirznerian-Schumpeterian theoretical framework, we find that, in the short term, epidemics trigger a wave of Kirznerian entrepreneurship aimed at reducing the uncertainty generated directly and indirectly by the medical emergency. In the long term, as medical uncertainty abates, Schumpeterian entrepreneurship can contribute to transforming the post-crisis environment, either supporting or undermining the public reaction to the crisis and determining the path of institutionalization, in the process of defining a new normal. Thus, epidemics could lead to unpredictable socioeconomic and technological improvements, but also to highly undesirable outcomes. The construction of a satisfactory new normal requires the integration of entrepreneurial capabilities within the public sector and an explicit policy of cooperation with the private sector. Therefore, as the short-term phase of the Covid-19 pandemic draws to a close, policymakers must shift their focus away from restrictions and obligations towards a collaborative framework supportive of private entrepreneurial efforts.

Misallocation of Talent and Innovation: evidence from China

ABSTRACT This study examined the effects of the misallocation of talent between the government and private enterprise sectors on innovation. By using the 2005 inter-census population survey and patent database, we find a negative correlation between misallocation of talent and innovation intensity. Exploring possible mechanisms, we conclude that this negative correlation between misallocation of talent and innovation was best explained by the negative impact of such misallocation upon entrepreneurship and R&D spending. That is, misallocations of talent reduce the willingness of people to be productive Schumpeterian entrepreneurs, and the majority of companies affected by such misallocation are reluctant to increase R&D spending. Most importantly, we find that excessive talent enters government departments in prefectures worse the suppression of innovation. This result sheds new light on the important role of allocation of talent on innovation for scholars and policymakers. Our findings have important implications for how to effectively allocate talent between the government vs.enterprise sectors in order to encourage more productive, value-creating activities.

Profiles of entrepreneurial success during two centuries. The case of Sweden, with comparisons to Italy

One of the challenges of studying entrepreneurship is the lack of longitudinal data. One way to address this is through a promising new statistical approach called prosopography, where standardised biographies of prominent entrepreneurs are systematically compiled and analysed using quantitative methodology. This method combines the detailed information available in biographies at the micro-level, with a macro-level systematic approach – an approach that, notably, has been previously applied to Italy. Here, we compile a dataset of 267 Swedish entrepreneurial biographies that focus on individuals active from the early 19th century until the present day. We find five distinctive clusters of entrepreneurs. Innovation intensity appears to be important, and, as expected, inventors represent a distinct cluster in Sweden. Other results are more novel, and in part go against the conventional view of Sweden as an industrial economy. For instance, many Swedish entrepreneurs, of both sexes, have developed what are best described as advanced service innovations, and stand as sole founders of the ventures. The institutional context clearly affects the type of entrepreneurs that emerge, but there is also evidence of interaction and reverse causation where prominent entrepreneurs have influenced the institutional development of Sweden. As a result, there is a hybrid version of capitalism combining high redistributive taxes with free market capitalism and ample room for Schumpeterian entrepreneurs as well as dynastic entrepreneurs – thereby also combining private wealth creation with distribution. While one of the world’s least family -oriented cultures, high -impact Swedish entrepreneurs are surprisingly dynastic in their entrepreneurial endeavours.

Entrepreneurship and economic growth: does gender matter?

PurposeEntrepreneurial firms contribute to economic growth, but the potential gendered nature of this contribution must be investigated as outcomes of male-owned and female-owned firms differ. The study investigates the female underperformance hypothesis in a cross-country analysis of Schumpeterian entrepreneurs. Next, it investigates if there is a gendered dimension of Schumpeterian firm contribution to economic growth.Design/methodology/approachThe study utilizes both nonparametric and parametric methodologies. Through nonparametric methods, the success of female-owned and male-owned firms is compared. Next, a parametric ordinary least squares regression model tests if there is a gendered nature of an entrepreneurial firm's economic contribution.FindingsIn nonparametric analyses, female-owned entrepreneurial firms in developed countries perform similarly to male-owned firms, while in developing countries male-owned firms significantly outperform female-owned firms. The author also finds strong evidence that the gender of the Schumpeterian entrepreneur does not matter in the contribution in economic growth.Research limitations/implicationsIn all countries, the number of female-owned entrepreneurial firms was significantly lower than that of male-owned firms. The findings point to consistent cultural barriers for women in innovation-related fields and persistent gendered norms in entrepreneurship. Thus, removal of cultural barriers and continued support for Schumpeterian entrepreneurship will benefit women and contribute to a country's economic growth.Originality/valueThe data for this study is a unique utilization of the Enterprise World Survey to identify Schumpeterian entrepreneurial firms. Additionally, the study challenges the female underperformance hypothesis and contributes to the literature on the role of entrepreneurship in economic growth.

Schumpeter’s Entrepreneur and The German Historical School. A Critical Analysis

This paper provides a fundamental critic of the Schumpeterian concept of entrepreneurship. Being one of the most influential economist of the 20th century, Schumpeter inspired many different lines of economic thought. The nexus of his theory, the concept of entrepreneurship, can be seen as his most important contribution to economic theory. A deeper understanding of the complex work of Schumpeter requires to identify the intellectual roots and the core of his thinking. This paper claims that the core in his thinking can be found in the conceptual basis of the German Historical School. It is reasoned that the Schumpeterian entrepreneur is understandable and inherently consistent, if he is interpreted as a representative of the thought system of German historicism.
 Key words: German Historical School - Schumpeter - Entrepreneurship.
 JEL Classification: A12, A14, B15, B25, B31, B53.
 Resumen: Este artículo critica de forma fundamental el concepto de función empresarial de Schumpeter e identifica que el origen conceptual de su teoría sobre el empresario se encuentra en la Escuela Histórica Alemana.
 Palabras clave: Escuela Histórica Alemana - Schumpeter - función empresarial.
 Clasificación JEL: A12, A14, B15, B25, B31, B53.

Correction to: The global technology frontier: productivity growth and the relevance of Kirznerian and Schumpeterian entrepreneurship

Correction to: The global technology frontier: productivity growth and the relevance of Kirznerian and Schumpeterian entrepreneurship

To Be or Not to Be: The Entrepreneur in Endogenous Growth Theory

We examine the conceptualization of entrepreneurs in neo-Schumpeterian growth theory, which has reintroduced entrepreneurs into mainstream economics. Specifically, we analyze how neo-Schumpeterians relate to the contradiction between the entrepreneur-centered view of Schumpeter (1934) and the entrepreneurless framework of Schumpeter (1942), with the two frameworks entailing vastly different economic and policy implications. The analysis is based on a review of approximately 750 peer-reviewed articles over the period 1990–2018. The articles were identified using text mining methodology and supervised machine learning. The results show that the literature leans towards Schumpeter (1942); innovation returns are modeled as following an ex ante known probability distribution. By assuming that the outcomes of innovation activities are (probabilistically) deterministic, the Schumpeterian entrepreneur becomes redundant. In addition, the literature abstracts from genuine uncertainty, thus evading central issues regarding the economic function of the entrepreneur, especially with respect to disruptive innovations, ownership, and profits. To incorporate genuine uncertainty, the literature needs to adopt a broader conceptual foundation that goes beyond equilibrium modeling.

Industrial ecology and sustainable change: inertia and transformation in Mexican agro-industrial sugarcane clusters

ABSTRACT This article explores the capacity of industrial ecology to generate sustainable development in Latin America’s agro-industrial clusters. An evolutionary analytical approach is outlined, which is used to study Veracruz’s (Mexico) sugarcane cluster through a qualitative methodology. Our goal is to show that social innovation is key to promoting the sustainable development of clusters characterized by fragmented social, power, and innovation networks. Accordingly, innovations in the realm of industrial ecology often have a dual impact. On the one hand, in the dominant network, industrial ecology is reduced to its technological dimensions within a political-economic framework constrained by its external insertion and the maintenance of power dynamics. On the other hand, industrial ecology is a vehicle for a kind of Schumpeterian entrepreneurship driven by the core values of trust, transparency, acknowledgement of other people’s capabilities, and non-discrimination. This new transformative network promotes true socio-technical change by enhancing local resources and involving other intermediate actors. It also creates a localized agro-food system that promotes the development of cluster-based dynamics in the territory through radical innovations in industrial ecology. The article presents a new way of inserting industrial ecology into the dynamics of cluster-based organizations.

The Scientific Output of a Database on Commercialized Patents

The purpose of this study is to present a unique database on commercialized patents and to illustrate how it can be used to analyze the commercialization process of patents. The dataset is based on a survey of Swedish patents owned by inventors and small firms with a remarkably high response rate of 80 percent. It contains some key variables on commercialization not found anywhere else, including whether, when and how (acquisition, licensing, existing or new firm) patents were commercialized as well as whether this commercialization was profitable or not. Thus, this patent database measures technological innovation. The dataset is complemented with indicators of patent quality (patent renewal, forward citations, and patent family) from archive sources. Basic statistics for the key variables are described. Finally, the scientific output in terms of published articles in peer-reviewed journals shows how this database can be used to analyze the commercialization process of patents. The dataset has, for instance, been used to 1) evaluate government loan programs for inventors; 2) analyze the different roles of the inventor and the Schumpeterian entrepreneur during commercialization; 3) estimate the transfer of tacit knowledge when patents are sold or licensed; and 4) analyze the entry strategy among inventors in oligopolistic markets

Chinese entrepreneurship in Indonesia: A business demography approach

This article analyses the demography of 1,600 registered firms owned and/or operated by ethnic Chinese businessmen in Indonesia during 1890–1940 in search of generalisable indications of Schumpeterian entrepreneurship. The population of firms increased significantly from 1890, before many went out of business in the 1920s and a new generation of firms and entrepreneurs emerged. By 1910 most firms were active in trade, but this categorisation takes insufficient account of their diverse business activities. During 1910–1940 the share of firms in other industries increased. Several were active in finance, taking deposits and financing business ventures. In the 1930s, the average equity value of the enterprises more than doubled, reflecting diversification into more capital-intensive operations, particularly manufacturing. These changes in the population of firms refute the perception that ethnic Chinese businessmen were not Schumpeterian entrepreneurs. Supplemental data for this article is available online at https://doi.org/10.6084/m9.figshare.12254018.

Anchor entrepreneurship and industry catalysis: The rise of the Italian Biomedical Valley

Accounting for the rise of the medical device industry in the Emilia-Romagna town of Mirandola from a once depressed agricultural area in 1962 to a world-manufacturing center for dialysis equipment and disposable plastic medical devices, requires in large measure mapping the methods of the local entrepreneur who spearheaded its development. Reworking Agrawal and Cockburn's anchor-tenant hypothesis highlighting the role of large organizations in fostering agglomerations, this paper privileges the Schumpeterian entrepreneur as the dynamic force driving new industrial formations. This anchor-entrepreneur with no prior experience in manufacturing medical devices and without any public financing or large private backers founded six firms. Each of these would be sold off fairly quickly to a different large multinational corporation. Placing the anchor-entrepreneur at the center stage advances understanding of early industry evolution, spelling out how first-mover pioneers shape the environment to establish the first markets needed to attract new resources and capabilities. Underpinning our argument are 61 fine-grain interviews with key medical device industry informants in addition to extensive secondary sources and historical records. We draw on this material to induce a stylized model of anchor-entrepreneurship and industry catalysis that rests on three generative processes: bricolage, second-hand imprinting and beaconing.

Malcom McLean, Containerization and Entrepreneurship

Does the entrepreneurial market process reflect an equilibrating or disequilibrating tendency in the allocation of resources? We address this question by utilizing the case of Malcom McLean, who pioneered and introduced container shipping to international trade. We argue that Schumpeterian and Kirznerian entrepreneurship are distinct, yet complementary activities that drive the market process towards an equilibrating tendency. By realizing containerization as a lower cost method of shipping goods internationally, we argue that McLean acted simultaneously as a Schumpeterian and Kirznerian entrepreneur, illustrating that these two notions of entrepreneurship are different segments of the same equilibrating market process. Containerization had a disruptive effect on previous methods of ocean shipping, but its adoption was introduced through an act of arbitrage, namely by redeploying existing resources, such as cranes, ships, ports, and storage facilities from lower-valued uses to perceived higher-valued uses. In the process, McLean was able to realize previously unnoticed profit opportunities by correcting previously existing inefficiencies in intermodal transport.

Between the market and the state: Ibáñez, the Marquis of Sargadelos (1749–1809), a Spanish businessman sailing against the tide

ABSTRACT When Spain began the transition from the Old Regime to liberalism, the business career of the Marquis of Sargadelos was unique. In an institutional scenario in which being a ‘profit seeker’ was an almost indispensable prerequisite to overcoming the steep barriers to the entry of manufacturing initiatives, and in a society where the capital accumulated in commercial and manufacturing ventures was diverted to the purchase of rural land, Ibáñez was an exception to the norm in two senses: first, for his willingness to take a risk on new industries, and second, for his efforts to update the available technology. It is in this sense that he might be described as a ‘Schumpeterian entrepreneur’. The aim of this article is to consider Ibáñez’s business career from a new perspective, both what it has in common with the classical business cycle of the time and the unique features of his industrial initiatives.

Transcending the Schumpeter-Kirzner Dichotomy: The Role of the Entrepreneur in Carl Menger’s Theory of Price

What is the role of the entrepreneur in Carl Menger’s account of the market process? Modern entrepreneurship theory is broadly divided into two types. The Schumpeterian account of entrepreneurship takes an equilibrium state of affairs as an analytic starting point from which the entrepreneur disrupts the existing equilibrium through technological innovation. The Kirznerian account of entrepreneurship begins from disequilibrium to illustrate the equilibrating role of the entrepreneur through arbitrage. While some working within the Austrian tradition have found Menger’s account to be lacking in precisely the entrepreneurial role that would become a distinctive contribution of the school, we demonstrate that Menger implicitly accounts for entrepreneurship in his theory of price formation. In doing so, we argue that Carl Menger’s account of entrepreneurship transcends the distinction between the Kirznerian and Schumpeterian entrepreneur by incorporating not only price adjusting behavior (i.e. arbitrage) but also non-price adjusting behavior (i.e. product differentiation; variations in quantity and quality; institutional innovation). To the extent that Schumpeterian and Kirznerian entrepreneurship are distinct categories in the history of economic thought, we show how both have roots in the pioneering efforts of Carl Menger, the founder of the Austrian School.