The Ecosystem Approach to Entrepreneurship Policy in the Digital Era

Abstract

The COVID-19 pandemic accelerated the digital transformation and affected entrepreneurial environment. Innovation is becoming more important than ever amid the digital transformation of society, and the role of start-ups in innovation has become especially vital, especially as a means of recovering from the economic shock of the COVID pandemic. The digital transformation and the importance of start-ups in economic development and recovery raise questions concerning the direction of entrepreneurship policies in the digital era.

This paper explores these questions, probing the relevant academic literature in search of answers. I focus on entrepreneurship policies from an ecosystem perspective and these policies’ importance in the digital era. First, I illustrate the concept of the entrepreneurial ecosystem by summarizing main components as described in the literature. While the body of scholarship on regional economics and entrepreneurship has sought to provide a definition of the concept, the theoretical framework remains a matter of debate. Next, focusing on the role of digital technology as a both a context and enabler of the entrepreneurial ecosystem, I discuss the changes digital transformation has wrought and the growing importance of adopting an ecosystem perspective in entrepreneurial policies in the digital era. Finally, I suggest potential directions for entrepreneurship policies in the digital era by linking them to the characteristics of entrepreneurial ecosystem.

Thank you for reading this abstract of a report from the Korea Institute for Industrial Economics and Trade!

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Keywords: entrepreneurship, digital platforms, digital transformation, digital companies, innovation, startups, venture firms, entrepreneurship policy, regional economics, regional innovation, digital technology, Korea, KIET

JEL Classification: L26, R10, R11, R58