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Growth of a platform business model as an entrepreneurial ecosystem and its effects on regional development

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  • JinHyo Joseph Yun
  • DongKyu Won
  • KyungBae Park
  • JeongHo Yang
  • Xiaofei Zhao

Abstract

This paper analyses the dynamics of platform business models as an entrepreneurial ecosystem and its effects on regional development. Here, we seek to answer the following research questions: (1) What effects do platform business models have on regional development? (2) What factors and structures affect the dynamics of platform business models? (3) How can we describe the dynamics of platform business models in app stores and hotel-booking industries? To answer these questions, the authors first analysed two platform entrepreneurial ecosystems in the smartphone app store industry (Google Play’s Android market and Apple’s App Store) and two ecosystems in the hotel-booking industry (Hotels.com and Booking.com). Second, we analysed the effects of platforms as entrepreneurial ecosystems on the regional development of Daegu Metropolitan City. We used in-depth interview methods with a semi-structured questionnaire, system dynamics (SD) simulation, a literature review, and a statistical analysis as research methods. The results of these analyses yielded the following findings. First, platform business models as economic ecosystems motivate a change of regional development from focused areas to multiple areas, from a hierarchical structure of firms to a network of diverse firms, and from scope and scale economy-based firms leading regional development to creative economy-based firms leading regional development. Second, we identified three category factors that were important in a platform ecosystem, and built up and simulated causal and SD models of these factors. Third, we found that the dynamics of platform ecosystems differ from platform to platform because the openness of platforms produces different effects on firms according to the industry to which they belong.

Suggested Citation

  • JinHyo Joseph Yun & DongKyu Won & KyungBae Park & JeongHo Yang & Xiaofei Zhao, 2017. "Growth of a platform business model as an entrepreneurial ecosystem and its effects on regional development," European Planning Studies, Taylor & Francis Journals, vol. 25(5), pages 805-826, May.
    • Handle: RePEc:taf:eurpls:v:25:y:2017:i:5:p:805-826
    DOI: 10.1080/09654313.2017.1282082
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    References listed on IDEAS

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    1. Kevin Boudreau, 2007. "Does Opening a Platform Stimulate Innovation? Effects on Systemic and Modular Innovations," Working Papers hal-00597764, HAL.
    2. David S. Evans & Andrei Hagiu & Richard Schmalensee, 2008. "Invisible Engines: How Software Platforms Drive Innovation and Transform Industries," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262550687, December.
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    Cited by:

    1. Junic Kim, 2018. "Platform Adoption Factors in the Internet Industry," Sustainability, MDPI, vol. 10(9), pages 1-12, September.
    2. Min-Ren Yan & Kuo-Ming Chien & Lin-Ya Hong & Tai-Ning Yang, 2018. "Evaluating the Collaborative Ecosystem for an Innovation-Driven Economy: A Systems Analysis and Case Study of Science Parks," Sustainability, MDPI, vol. 10(3), pages 1-13, March.
    3. Hui Zhang & Huanhuan Xiong & Jianxin Xu, 2022. "Dynamic Simulation Research on the Effect of Governance Mechanism on Value Co-Creation of Blockchain Industry Ecosystem," Sustainability, MDPI, vol. 14(12), pages 1-18, June.
    4. Helena Zentner & Daniela Gračan & Marina Barkiđija Sotošek, 2022. "Digital Business Models in the Hospitality Sector: Comparing Hotel Bookings with Yacht Charter Bookings," Sustainability, MDPI, vol. 14(19), pages 1-17, October.
    5. Ta-Kai Yang & Min-Ren Yan, 2019. "Exploring the Enablers of Strategic Orientation for Technology-Driven Business Innovation Ecosystems," Sustainability, MDPI, vol. 11(20), pages 1-19, October.
    6. Abbate, Tindara & Cesaroni, Fabrizio & Cinici, Maria Cristina & Villari, Massimo, 2019. "Business models for developing smart cities. A fuzzy set qualitative comparative analysis of an IoT platform," Technological Forecasting and Social Change, Elsevier, vol. 142(C), pages 183-193.
    7. Ta-Kai Yang & Min-Ren Yan, 2020. "The Corporate Shared Value for Sustainable Development: An Ecosystem Perspective," Sustainability, MDPI, vol. 12(6), pages 1-16, March.
    8. Xinxiang Zhang & Lijun Hu & Manjula Salimath & Ching-Chung Kuo, 2018. "Developing Evaluation Frameworks for Business Models in China’s Rural Markets," Sustainability, MDPI, vol. 11(1), pages 1-28, December.
    9. Birgit Leick & Bjørnar Karlsen Kivedal & Mehtap Aldogan Eklund & Evgueni Vinogradov, 2022. "Exploring the relationship between Airbnb and traditional accommodation for regional variations of tourism markets," Tourism Economics, , vol. 28(5), pages 1258-1279, August.
    10. Angelo Cavallo & Antonio Ghezzi & Raffaello Balocco, 2019. "Entrepreneurial ecosystem research: present debates and future directions," International Entrepreneurship and Management Journal, Springer, vol. 15(4), pages 1291-1321, December.
    11. Lian, Jiunn-Woei, 2021. "Determinants and consequences of service experience toward small retailer platform business model: Stimulus–organism–response perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 62(C).
    12. Rangaswamy, Arvind & Moch, Nicole & Felten, Claudio & van Bruggen, Gerrit & Wieringa, Jaap E. & Wirtz, Jochen, 2020. "The Role of Marketing in Digital Business Platforms," Journal of Interactive Marketing, Elsevier, vol. 51(C), pages 72-90.
    13. Angelo Cavallo & Antonio Ghezzi & Cristina Rossi-Lamastra, 2021. "Small-medium enterprises and innovative startups in entrepreneurial ecosystems: exploring an under-remarked relation," International Entrepreneurship and Management Journal, Springer, vol. 17(4), pages 1843-1866, December.

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