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Entrepreneurship, Innovation and Institutions

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Author Info

  • E. Stam
  • B. Nooteboom

Abstract

This paper discusses the nature of entrepreneurship and its relation to innovation along a cycle in which exploration and exploration follow upon each other. We place the roles of entrepreneurship in innovation policy within this cycle of innovation. Different types of innovation along the cycle of innovation are realized with different forms of entrepreneurship, which are constrained or enabled by different legal institutions. One of the key roles of governments is to design, change or destruct institutions in order to improve societal welfare. The question is what governments should do in the context of innovation policy. Here, social scientists can make a contribution by providing insight into what entrepreneurship and innovation is (theories about these phenomena), and how institutions affect them in reality (empirical evidence about their effects). This requires social scientists to be engaged scholars and to provide new policy options as an honest broker between the academic world and the policy world. The key question of this paper is: How can policy best enable innovation based entrepreneurship? The answer is derived from looking at both theoretical tenets and empirical evidence using an institutional design perspective, which aims at providing arguments for the design, change and/or destruction of institutions, given the goals of the governments. We provide an overview of some (empirically tests of) institutions that enable or restrain particular types of entrepreneurship. Examples of these institutions are intellectual property rights and the Small Business Innovation Research program, employment protection, and non-compete covenants.

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File URL: http://dspace.library.uu.nl/bitstream/handle/1874/218744/11-03.pdf
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Bibliographic Info

Paper provided by Utrecht School of Economics in its series Working Papers with number 11-03.

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Length: 21 pages
Date of creation: 2011
Date of revision:
Handle: RePEc:use:tkiwps:1103

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Related research

Keywords: entrepreneurship; innovation; institutions; innovation policy;

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References

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  1. André van Stel & Roy Thurik & David Storey, 2006. "The effect of business regulations on nascent and young business entrepreneurship," Scales Research Reports H200609, EIM Business and Policy Research.
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Citations

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Cited by:
  1. Wim Naudé, 2011. "Foreign Aid for Innovation: The Missing Ingredient in Private Sector Development?," Working Papers 2011/35, Maastricht School of Management.
  2. repec:dgr:uvatin:2010080 is not listed on IDEAS
  3. Bos Jaap W.B. & Stam Erik, 2011. "Gazelles, Industry Growth and Structural Change," Research Memorandum 018, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  4. Roy Thurik & David Audretsch & F. Stam, 2011. "Unraveling the Shift to the Entrepreneurial Economy," Scales Research Reports H201113, EIM Business and Policy Research.
  5. Erik Stam, 2013. "Knowledge and entrepreneurial employees: a country-level analysis," Small Business Economics, Springer, vol. 41(4), pages 887-898, December.

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