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Small Business Economics

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01-02-2013

An absorptive capacity theory of knowledge spillover entrepreneurship

Authors: Haifeng Qian, Zoltan J. Acs

Published in: Small Business Economics | Issue 2/2013

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Abstract

The knowledge spillover theory of entrepreneurship identifies new knowledge as a source of entrepreneurial opportunities, and suggests that entrepreneurs play an important role in commercializing new knowledge developed in large incumbent firms or research institutions. This paper argues that, knowledge spillover entrepreneurship depends not only on new knowledge but more importantly on entrepreneurial absorptive capacity that allows entrepreneurs to understand new knowledge, recognize its value, and commercialize it by creating a firm. This absorptive capacity theory of knowledge spillover entrepreneurship is tested using data based on U.S. metropolitan areas.

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Scholars generally distinguish technology/knowledge transfer from technology/knowledge spillover. Technology transfer refers to the knowledge flow between different parties with compensation based on the market value of the knowledge, and in the case of technology spillover, the knowledge flow is either undercompensated or not compensated at all. However, knowledge is characterized with uncertainty (Arrow 1962). It is difficult to determine the market value of knowledge and thus difficult to identify whether a knowledge flow is a transfer or a spillover (Agarwal et al. 2010).

We appreciate one reviewer’s suggestion that entrepreneurial absorptive capacity can also be tested in an interaction term:\( Entrepreneurship\,=\, \gamma_{1} HumanCapital + \gamma_{2} NewKnowledge\,+\,r_{3} HumanCaptial*NewKnowledge\,+\,\varepsilon_{{}} \). We did find a positive coefficient (significant at the 0.10 level) of the interaction term, consistent with our results in path analysis.

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Title: An absorptive capacity theory of knowledge spillover entrepreneurship
Authors: Haifeng Qian
Zoltan J. Acs
Publication date: 01-02-2013
Publisher: Springer US
Published in: Small Business Economics / Issue 2/2013
Print ISSN: 0921-898X
Electronic ISSN: 1573-0913
DOI: https://doi.org/10.1007/s11187-011-9368-x

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