Entrepreneurship and Network Externalities

Posted: 17 Nov 2009

See all articles by Maria Minniti

Maria Minniti

Syracuse University - Whitman School of Management

Date Written: 2005


Entrepreneurship creates a unique culture and a sphereof influence that affects the behavior of other entrepreneurs.Based uponthis influence and considering the agglomeration phenomenon, a dynamic modelregarding the emergence of different levels of entrepreneurial activity indifferent communities is proposed. Past research regarding the relationship between entrepreneurship and thesocial environment is presented, as is information concerning the geographicconcentration of entrepreneurial activities.A formula measuring therelationship between individual choices and relative returns isdiscussed.Through several permutations, this formula is transformed todetermine the dynamic model of entrepreneurial activity.The indicationsfrom the model are then discussed in terms of how they are influenced by thepublic policies of their geographic region. The results of the model indicate that entrepreneurship does tend toconcentrate geographically.Although geographic areas with similarcharacteristics may exhibit significantly different levels of entrepreneurship,the author suggests that the presence of other entrepreneurs who serve as rolemodels to interested individuals may reinforce the presence ofentrepreneurship.Areas of further exploration are discussed.(AKP)

Keywords: Entrepreneurial activity, Regions, Public policies, Social conditions & trends, Clusters

Suggested Citation

Minniti, Maria, Entrepreneurship and Network Externalities (2005). Journal of Economic Behavior & Organization, Vol. 57, Issue 1, p. 1-27 2005. Available at SSRN: https://ssrn.com/abstract=1507616

Maria Minniti (Contact Author)

Syracuse University - Whitman School of Management ( email )

721 University Avenue
Syracuse, NY 13244-2130
United States

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