Entrepreneurship, Human Capital, and Regional Development

The literature describes entrepreneurial process as a multidimensional and complex phenomenon. Most conceptual frameworks advocate that the entrepreneurship is a function of the opportunity and the individual entrepreneur, his or her characteristics and actions. A knowledge-based perspective suggests that entrepreneurship can be thought of as a function of knowledge and attitude. Such perspective proposes that there is one single dominant factor upon which the opportunity, the individual, and the whole entrepreneurial process are based. This factor is knowledge as a property of individuals or organizations which are intelligent agents in their own right, and which are challenged to have a critical attitude in order to execute the entrepreneurial process. Recent works on this research area suggest that there is a positive link between entrepreneurship, regional economic performance, and the creation of new firms and businesses. Regions are now facing rapidly evolving pressures from global economy. Regions prosperity no longer lies in traditional assets such as cheap land and labor. Instead, regions’ success is shaped by new categories of assets, like skills, innovative firms, lifestyle amenities, cultural assets, and intellectual capital. Although, in the last years, many studies have investigated the knowledge factors grounding local development there are still gaps in the research that need to be filled for the definition of the theory pillars of an intellectual capital dimension of regional development dynamics. This chapter contributes to the literature on the role entrepreneurship plays in regional development, providing a holistic view of the knowledge-based entrepreneurial activity.

With regard to the perspectives of human capital, university status and role identity, I investigate how the career paths of academic entrepreneurs can influence university spin-off growth. The results from the qualitative content analysis and extreme case analysis show that each university status comprises certain advantages and disadvantages. Academic entrepreneurs are located in a trade-off. More human capital and a higher university status are not necessarily advantageous for long-term university spin-off growth. Instead, the willingness and ability for role identity change in terms of the degree of commitment to the entrepreneurial role is very important. Therefore, it is important to consider the career plans and growth intentions of an academic entrepreneur. In order to compensate certain disadvantages of different university statuses the formation of founding teams with complementary skills and university statuses should be promoted.

Previous studies have recognized the relevance of certain individual (generic and specific human capital) and organizational (work environment) factors in the creation of new ventures from and for an existing organization. The objective of this exploratory study is to understand the roles of employee human capital and the work environment on the creation of organizational spin-offs. Adopting the human capital and the corporate entrepreneurship approaches, a conceptual framework was proposed and tested with data from the 2012 Spanish Adult Population Survey (Global Entrepreneurship Monitor, GEM). Due to the nature of the data and research objective, a rare event model was used for the analysis. Our results provide evidence about the relevant roles of specific human capital (entrepreneurship educational training) and the work environment (job autonomy) on the propensity that an employee becomes an intrapreneur and leads a spin-off “from” and “for” their employer. We also show that a stronger moderation effect of job autonomy takes place in the relationship between entrepreneurship education and organizational spin-off creation. In general, these results would help employees, top managers, and policy makers take into account the relevance of these individual and organizational factors when defining their strategic decisions/planning.

The role of firm’s resources or specifically knowledge in achieving sustained competitive advantage has been well established in strategic management literature. To strengthen their competitive advantage, extent or enrich their knowledge base, firms used to hire people embedding appropriate human capital. Whereas the nature of this competitive advantage has been largely investigated, it is not exactly the case for the processes or conditions through which firms used to construct it. This paper wants to contribute to a better understanding of how it is constructed by investigating, how far the resource that spinoff already has constrained, or determine the acquisition of next ones.

We are considering spinoffs and spinouts as two distinct configurations of knowledge inheritance with the former being different from the latter in that s(he) benefits from additional support of financial or physical nature from its previous employer. Nevertheless, nothing is clear on the respective role of knowledge the spinoffs/spinouts have inherited from mother firm or industry and that of the founders leading the business creation process—namely her/his human capital. We hypothesize a greater preference for coworkers hiring in case of greater inheritance of resources from a mother company. The propensity of spinoffs/spinouts to hire founders’ previous coworkers should be greater than that of other entrants but moderating effect should be expected giving a relative importance to person who is hiring.

First results come with new evidences supporting old arguments of some resource-based views of scholars regarding the importance of resources that characterizes a firm and its position in terms of competitive advantage. These evidences are compelling for they suggest that the phenomenon already begin at firm’s early stage and extends it on preoccupations of first hires. Other results are also interesting in understanding the contribution of the status of some new businesses in worker mobility, knowledge diffusion, competition between spinoffs/spinouts and mother firms, and in a certain sense cluster dynamics.

Although previous research shows that spin-offs are among the most successful firms in an industry, outperforming de novo entrants, few studies consider the heterogeneity of corporate spin-offs in relation to firm performance or survival. Against this backdrop, the objective of the present chapter is twofold. First, this study aims to add to our knowledge on the relationship between spin-off type and firm survival using a comprehensive matched employer-employee dataset from Portugal. After controlling for their different start-up conditions—namely regarding initial hiring schemes, business-owners’ characteristics, and the industrial and geographical relatedness to the parent firm—and a set of firm, industry, and macroeconomic characteristics, we found no significant survival differences between opportunity and necessity spin-offs. Second, based on the findings, we suggest that necessity spin-offs have not received the attention they deserve. Not only do necessity spin-offs perform an important role in the dynamics of competitive markets, by offering a possible solution for recently displaced individuals, but they also create new jobs and help to prevent the depreciation of workers’ human capital.

Most existing literature on spin-offs deals with factors affecting the emergence of these firms and not so much with what influences their economic outcomes. Moreover, the role of human capital as a potential booster of economic performance in spin-offs has been neglected or analyzed rather superficially. This chapter aims at assessing the role that human capital plays on the performance of Portuguese spin-offs in its different forms, including the entrepreneurs’ level and type of education, skills, experience, and network capabilities. Using a sample of 90 founders of 61 Academic Spin-Offs (ASOs) located in Portugal, associated with the University Technology Enterprise Network (UTEN), it was found that among human capital dimensions, business expertise, most notably market knowledge, was the one that affected economic performance the most in ASOs. Both the level and type of formal education of the founders failed to significantly influence the economic performance of ASOs. The unemployment status of the founders (prior to creating the ASOs), formal contacts with university, as well as the undertaking of R&D activities and internationalization emerged as critical positive determinants of economic performance in ASOs. Although some evidence exists on the relevance of university research excellence for the performance of ASOs, a univocal result emerged regarding the university context: ASOs that exclusively resort to the services of Science Parks, Incubators, and TTOs outperformed the others.

This work focuses on the influence of external knowledge via recruitment on the development of academic spin-off (ASO) firms, that is those businesses that are generated by academic staff and are based on results of research conducted within the university. Given the importance of external knowledge for these firms to develop and grow it is important to understand the mechanisms by which such knowledge is internalized and the impact of such knowledge on the firms’ strategies and capability development. This work, by means of a multiple case study research, seeks to shed light on the issue with respect to recruitment processes. Results show that hiring managers and researchers from the external environment is a response to some particular situations. The consequences of these recruitment strategies are also analyzed.

This paper tackles in an innovative way the issue on coopetition, by making use of service firms’ behavior in generating innovative services, to reveal their innovative performance and the dynamics of coopetition targeted at open innovation. For this purpose, we use a dataset of 1,221 service firms that participated in the European Community Innovation Survey (CIS), 2008. A probit analysis is conducted for “knowledge-intensive service (KIS) firms” and “less-KIS firms” and, the results reveal that coopetition arrangements between competing firms and scientific community, and also firms’ capacity to introduce innovations into the market, have a positive and significant influence on service firms’ behavior to generate service innovations. Furthermore, this study also reveals that the effects of introducing process innovations inside the firm and the existence of internal R&D activities are of major significance for influencing positively the innovative behavior of service firms.

The current study analyzes how Spaniard’s general/specific human capital influences their likelihood of perceiving entrepreneurial opportunities and creating a business. The analysis pivots around the comparison of two processes which are part of entrepreneurship. Data from the Spanish Global Entrepreneurship Monitor—GEM of 2008 are used. Logistic regression analysis is performed to test several theoretical hypotheses. Findings revealed that general human capital such as education is not significant for both perceiving entrepreneurial opportunities and creating a business. However, work experience, managerial business, and entrepreneurial training are positively significant to perceive entrepreneurial opportunities and to create a business. This research reveals that specific types of human capital play different roles in entrepreneurship. The contribution of this paper is to compare how the human capital influences upon two processes of entrepreneurship.

Having a highly centralized administrative system, Turkey’s development policies have been managed and directed by the central ministries which led to further state dependency in the local and avoid the self-evolution of regional policy making capacity. Thus the premature nature of regional development in Turkey, by and large, necessitates top-to-down approaches that enforced a unique trajectory of regionalization process instead of self-emerging regionalism. In the absence of augmented development tools and policy design, the cluster policies found a robust environment to grow. In other words the localities seek for the easiest and popular way toward development, and clusters have been perceived as the imitable regional development policy by many organizations and localities with a little questioning if they are appropriate for their localities or not. Surprisingly, known by only a few of the scholars, Turkey hosts one of the oldest clusters, now known as a touristic destination called as the Grand Bazaar in Istanbul which dates back to fifteenth century—the Ottoman period—exhibits cluster characteristics when there was no awareness about clusters. However by the establishment of the Republic with a strong central government to keep the nation and country intact, the regional structures inherited from the Ottoman Empire lost their ground. The recent emerge of cluster policies in Turkey is parallel to the acceleration of regional development particularly after the 2000s, mainly due to the EU accession process. Even the visit of Michael Porter’s team to Turkey is a strong evidence of internationalization of national cluster policies. In this line the chapter tries to illustrate the international dimension in the development of cluster policies in Turkey. To do so it discusses the brief history of absence(ness) of regional development policies in Turkey and recent efforts to regionalize. In this regard the policy shifts towards clusters in various public policy documents are examined and the efforts by the international and local organizations for developing clusters in various parts of the country are shown.

This paper analyzes the impact on firm-level total factor productivity of both agglomeration economies and regional knowledge base, using an unbalanced panel of Portuguese manufacturing firms covering the period 1996–2004. Controlling for the endogeneity using the difference generalized method of moments estimator, we found that both localization and urbanization economies have a significant and positive effect on firm productivity, with the latter playing the most important role. Sectoral specialization economies are important for small and medium firms, but not for large firms. However, larger firms, therefore those with higher absorptive capacity, profit more from regional knowledge than smaller ones.

This paper reviews the history of the emergence of the molds and plastics industries in Portugal, finding that this history fits nicely with the accounts—originally proposed in Steven Klepper’s various works—of new industries emerging from older, related industries, and regional clusters emerging from the mobility of specialized workers from successful incumbents to new firms created in the same regional environment. In addition, it addresses the role played by entrepreneurship, spinoffs, and the transmission of organizational competences from successful incumbents to new firms through the mobility of specialized workers played in the evolution of the two referred industries.

This chapter discusses the connection between changing ideas for regional policy formulation in Norway and Spain taking on a “scalar politics” framework. The analysis demonstrates that regional industrial policies are rooted in processes of downscaling in Norway and upscaling in Spain, while rescaling of regional policy away from being primarily a nationally controlled project is a universal concern. Another trend is that the policy instruments have become more homogeneous across communities and regions over the years. Thus, it seems that the Fordism and post-Fordism left more scope for contextual policies than the recent phase of “contextualism”.