Evaluating and comparing entrepreneurial ecosystems using SMAA and SMAA-S

Abstract

This paper focuses on the entrepreneurial ecosystem as a set of interdependent and coordinated factors in a territory enabling entrepreneurship. To date, academic research has failed to produce methodologies for evaluating and comparing entrepreneurial ecosystems from different perspectives that can highlight the underlying factors. Moreover, there is a lack of empirical analysis that discriminates between factors according to their importance. Taking into account these two gaps, the aim of the paper is twofold. First, it proposes the application of an accurate, robust and reliable measurement technique, namely stochastic multicriteria acceptability analysis (SMAA). It considers the variability of weights that can be assigned to the different factors, producing a probabilistic ranking to obtain a comparison among entrepreneurial ecosystems. This ranking is more reliable than a single ranking proposed by the usual composite indices that take into account a single vector of weights. Second, the paper presents a new methodology, SMAA for strategic management analytics and assessment, or SMAA squared (SMAA-S), which detects the relation between entrepreneurial ecosystem factors and growth-oriented start-ups in a territory. The results show that the most relevant entrepreneurial ecosystem factors enabling the birth and activity of high-growth start-ups, and so impacting on technology, economy and society, can be identified in cultural and social norms, government programs, and internal market dynamics.

This is a preview of subscription content, log in to check access.

Notes

  1. 1.

    http://www.oecd.org/industry/business-stats.

  2. 2.

    http://entrepreneurial-revolution.com.

  3. 3.

    http://www.weforum.org.

References

  1. Achrol, R. S., & Stern, L. W. (1988). Environmental determinants of decision-making uncertainty in marketing channels. Journal of Marketing Research, 25(1), 36–50.

    Article  Google Scholar 

  2. Acs, Z. J., & Mueller, P. (2008). Employment effects of business dynamics: Mice, gazelles and elephants. Small Business Economics, 30, 85–100.

    Article  Google Scholar 

  3. Acs, Z. J., Parsons, W., & Tracy, S. (2008). High impact firms: Gazelles revisited. Office of Advocacy Working Paper, US Small Business Administration.

  4. Alvedalen, J., & Boschma, R. (2017). A critical review of entrepreneurial ecosystems research: Towards a future research agenda. European Planning Studies, 25(6), 887–903.

    Article  Google Scholar 

  5. Angilella, S., Bottero, M., Corrente, S., Ferretti, V., Greco, S., & Lami, I. (2016). Non additive robust ordinal regression for urban and territorial planning: An application for siting an urban waste landfill. Annals of Operations Research, 245(1), 427–456.

    Article  Google Scholar 

  6. Angilella, S., Corrente, S., & Greco, S. (2015). Stochastic multiobjective acceptability analysis for the Choquet integral preference model and the scale construction problem. European Journal of Operational Research, 240, 172–182.

    Article  Google Scholar 

  7. Audretsch, D. (1995). Innovation, growth and survival. International Journal of Industrial Organization, 13(4), 441–457.

    Article  Google Scholar 

  8. Audretsch, D. B., & Belitski, M. J. (2017). Entrepreneurial ecosystems in cities: Establishing the framework conditions. The Journal of Technology Transfer, 42(5), 1030–1051.

    Article  Google Scholar 

  9. Audretsch, D. B., & Fritsch, M. (1994). On the measurement of entry rates. Empirica, 21, 105–113.

    Article  Google Scholar 

  10. Audretsch, D. B., Heger, D., & Veith, T. (2015). Infrastructure and entrepreneurship. Small Business Economics, 44(2), 219–230.

    Article  Google Scholar 

  11. Audretsch, D. B., & Keilbach, M. (2004). Does entrepreneurship capital matter? Entrepreneurship Theory and Practice, 28(5), 419–429.

    Article  Google Scholar 

  12. Birch, D. L., Medoff, J., Solmon, L. C., & Levenson, A. R. (1994). Gazelles, labor markets, employment policy and job creation. Boulder, CO: Westview Press.

    Google Scholar 

  13. Boschma, R. (2004). Competitiveness of regions from an evolutionary perspective. Regional Studies, 38, 1001–1014.

    Article  Google Scholar 

  14. Brüderl, J., & Preisendörfer, P. (2000). Fast-growing businesses: Empirical evidence from a German study. International Journal of Sociology, 30(3), 45–70.

    Article  Google Scholar 

  15. Bruyat, C., & Julien, P. A. (2000). Defining the field of research in entrepreneurship. Journal of Business Venturing, 16, 165–180.

    Article  Google Scholar 

  16. Carayannis, E. G., Provance, M., & Grigoroudis, E. J. (2016). Entrepreneurship ecosystems: An agent-based simulation approach. The Journal of Technology Transfer, 41(3), 631–653.

    Article  Google Scholar 

  17. Carree, M. A., & Thurik, A. R. (2008). The lag structure of the impact of business ownership on economic performance in OECD countries. Small Business Economics, 30(1), 101–110.

    Article  Google Scholar 

  18. Chan, H. K., Yee, R. W., Dai, J., & Lim, M. K. (2016). The moderating effect of environmental dynamism on green product innovation and performance. International Journal of Production Economics, 181(2), 384–391.

    Article  Google Scholar 

  19. Chapman, T. (2011). Building an entrepreneurial ecosystem: Lesson from Omaha. Omaha, NE: Amanda Styron Community Builder Editor.

    Google Scholar 

  20. Charnes, A., Cooper, W., & Rhodes, E. (1987). Measuring the efficiency of decision making units. European Journal of Operational Research, 2, 429–444.

    Article  Google Scholar 

  21. Chua, R. Y., Roth, Y., & Lemoine, J. F. (2015). The impact of culture on creativity: How cultural tightness and cultural distance affect global innovation crowdsourcing work. Administrative Science Quarterly, 60, 189–227.

    Article  Google Scholar 

  22. Cohen, B. (2006). Sustainable valley entrepreneurial ecosystems. Business Strategy Environment, 15, 1–14.

    Article  Google Scholar 

  23. Cunningham, J., & O’Kane, C. (2017). Technology based nascent entrepreneurship. London: Palgrave Macmillan.

    Google Scholar 

  24. Davidsson, P. (2004). Researching entrepreneurship. International Studies in Entrepreneurship. Boston, MA: Springer.

    Google Scholar 

  25. Davidsson, P., & Henrekson, M. (2002). Determinants of the prevalence of start-ups and high-growth firms. Small Business Economics, 19(2), 81–104.

    Article  Google Scholar 

  26. De Mel, S., McKenzie, D., & Woodruff, C. (2009). Measuring microenterprise profits: Must we ask how the sausage is made? Journal of Development Economics, 88(1), 19–31.

    Article  Google Scholar 

  27. Dejardin, M. (2011). Linking net entry to regional economic growth. Small Business Economics, 36, 443–460.

    Article  Google Scholar 

  28. Del Giudice, M., Nicotra, M., Romano, M., & Schillaci, C. E. (2017). Entrepreneurial performance of principal investigators and country culture: Relations and influences. The Journal of Technology Transfer, 42(2), 320–337.

    Article  Google Scholar 

  29. Delmar, F., Davidsson, P., & Gartner, W. B. (2003). Arriving at the high-growth firm. Journal of Business Venturing, 18(2), 189–216.

    Article  Google Scholar 

  30. Dennis, W. J., Jr. (1997). More than you think: An inclusive estimate of business entries. Journal of Business Venturing, 12, 175–196.

    Article  Google Scholar 

  31. Dennis, W. J., Jr. (1999). Business starts and stops. Wells Fargo/NFIB Series. Washington, DC: The NFIB Education Foundation.

    Google Scholar 

  32. Djankov, S., La Porta, R., Lopez-de-Silanes, F., & Shleifer, A. (2002). The regulation of entry. Quarterly Journal of Economics, 117(1), 1–37.

    Article  Google Scholar 

  33. Eisenhardt, K. M., & Martin, J. A. (2000). Dynamic capabilities: What are they? Strategic Management Journal, 21(10–11), 1105–1121.

    Article  Google Scholar 

  34. European Commission (2013). Research and Innovation performance in EU Member States and Associated countries. Innovation Union progress at country level.. Luxembourg: Publications Office of the European Union.

    Google Scholar 

  35. Feld, B. (2012). Start-up communities: Building an entrepreneurial ecosystem in your city. Hoboken, NJ: Wiley InterScience.

    Google Scholar 

  36. Fischer, M. M., & Nijkamp, P. (1988). The role of small firms for regional revitalization. The Annals of Regional Science, 22(1), 28–42.

    Article  Google Scholar 

  37. Fritsch, M. (2013). New business formation and regional development—A survey and assessment of the evidence. Foundations and Trends in Entrepreneurship, 9, 249–364.

    Article  Google Scholar 

  38. Fritsch, M., & Mueller, P. (2008). The effect of new business formation on regional development over time. The case of Germany. Small Business Economics, 30(1), 15–29.

    Article  Google Scholar 

  39. Gartner, W. B. (1990). What are we talking about when we talk about entrepreneurship? Journal of Business Venturing, 5(1), 15–28.

    Article  Google Scholar 

  40. Gartner, W. B., & Shane, S. A. (1995). Measuring entrepreneurship over time. Journal of Business Venturing, 10(4), 283–301.

    Article  Google Scholar 

  41. GEM. (2017). Global report 2016/2017. http://www.gemconsortium.org/report/49812. Accessed 3 Apr 2017.

  42. Greco, S., Figueira, J. R., & Ehrgott, M. (2016). Multiple criteria decision analysis: State of the art surveys. Berlin: Springer.

    Google Scholar 

  43. Greco, S., Ishizaka, A., Matarazzo, B., & Torrisi, G. (2017). Stochastic multiattribute acceptability analysis: An application to the ranking of Italian regions. Regional Studies. https://doi.org/10.1080/00343404.2017.1347612.

    Article  Google Scholar 

  44. Greco, S., Ishizaka, A., Tasiou, M., & Torrisi, G. (2018). On the methodological framework of composite indices: A review of the issues of weighting, aggregation, and robustness. Social Indicators Research. https://doi.org/10.1007/s11205-017-1832-9.

    Article  Google Scholar 

  45. Greco, S., Matarazzo, B., & Słowiński, R. (2001). Rough set theory for multicriteria decision analysis. European Journal of Operational Research, 129(1), 1–47.

    Article  Google Scholar 

  46. Halabisky, D., Dreessen, E., & Parsley, C. (2006). Growth in firms in Canada 1985–1999. Journal of Small Business and Entrepreneurship, 19(3), 255–268.

    Article  Google Scholar 

  47. Harrington, K. (2016). Is your entrepreneurial ecosystem scaling? An approach to inventorying and measuring a region’s innovation momentum. Innovations, 11(1), 126–142.

    Article  Google Scholar 

  48. Hébert, R. F., & Link, A. N. (1989). In search of the meaning of entrepreneurship. Small Business Economics, 1(1), 39–49.

    Article  Google Scholar 

  49. Isenberg, D. J. (2010). How to start an entrepreneurial revolution. Harvard Business Review, 88(6), 41–50.

    Google Scholar 

  50. Isenberg, D. J. (2011). The entrepreneurship ecosystem strategy as a new paradigm for economy policy: Principles for cultivating entrepreneurship. Babson Entrepreneurship Ecosystem Project. Babson Park, MA: Babson College.

    Google Scholar 

  51. Jansen, J. J. P., Van Den Bosch, F. A. J., & Volberda, H. W. (2006). Exploratory innovation, exploitative innovation, and performance: Effects of organizational antecedents and environmental moderators. Management Science, 52(11), 1661–1674.

    Article  Google Scholar 

  52. Jap, S. D. (1999). Pie-expansion efforts: Collaboration processes in buyer–supplier relationships. Journal of Marketing Research, 36(4), 461–475.

    Google Scholar 

  53. Jha, S. (2008). Trade, institutions and religious tolerance: Evidence from India. Stanford University Research Paper, no. 2004. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=948734. Accessed 10 July 2017.

  54. Kamasak, R., Yavuz, M., & Altuntas, G. (2016). Is the relationship between innovation performance and knowledge management contingent on environmental dynamism and learning capabilities? Evidence from a turbulent market. Business Research, 9(2), 229–253.

    Article  Google Scholar 

  55. Karatas-Ozkan, M., Anderson, A. R., Fayolle, A., Howells, J., & Condor, R. (2014). Understanding entrepreneurship: Challenging dominant perspectives and theorizing entrepreneurship through new postpositivist epistemologies. Journal of Small Business Management, 52, 589–593.

    Article  Google Scholar 

  56. Keeney, R. L., & Raiffa, H. (1976). Decisions with multiple objectives: Preferences and value tradeoffs. New York, NY: Wiley.

    Google Scholar 

  57. Kendall, M. (1938). A new measure of rank correlation. Biometrika, 30(1–2), 81–89.

    Article  Google Scholar 

  58. Klapper, L., Lewin, A., & Delgado, J. M. Q. (2009). The impact of the business environment on the business creation process. World Bank, Development Research Group, Finance and Private Sector Team, Policy Research Working Paper, no. 4937. World Bank.

  59. Klepper, S. (2009). Spinoffs: A review and synthesis. European Management Review, 6, 159–171.

    Article  Google Scholar 

  60. Kuratko, D. F., & Menter, M. (2017). The role of public policy in fostering technology-based nascent entrepreneurship. In J. Cunningham & C. O’Kane (Eds.), Technology based nascent entrepreneurship (pp. 19–52). New York: Palgrave Macmillan.

    Google Scholar 

  61. Lahdelma, R., Hokkanen, J., & Salminen, P. (1998). SMAA—Stochastic multiobjective acceptability analysis. European Journal of Operational Research, 106(1), 137–143.

    Article  Google Scholar 

  62. Lahdelma, R., Salminent, P., & Hokkanen, J. (2002). Locating a waste treatment facility by using stochastic multicriteria acceptability analysis with ordinal criteria. European Journal of Operational Research, 142(2), 345–356.

    Article  Google Scholar 

  63. Leskinen, P., Viitaned, J., Kangas, A., & Kangas, J. (2006). Alternatives to incorporate uncertainty and risk attitude in multicriteria evaluation of forest plans. Forest Science, 52(3), 304–312.

    Google Scholar 

  64. Littunen, H., & Tohmo, T. (2003). The high growth in new metal-based manufacturing and business service firms in Finland. Small Business Economics, 21(2), 187–200.

    Article  Google Scholar 

  65. Malecki, E. J. (2011). Connecting local entrepreneurial ecosystems to global innovation networks: Open innovation, double networks, and knowledge integration. International Journal of Entrepreneurship and Innovation Management, 14, 36–59.

    Article  Google Scholar 

  66. McKernan, S. M. (2002). The impact of microcredit programs on self-employment profit: Do non-credit program aspects matter? The Review of Economics and Statistics, 84(1), 93–115.

    Article  Google Scholar 

  67. Miller, D., & Friesen, P. (1983). Strategy-making and environment: The third link. Strategic Management Journal, 4(3), 221–235.

    Article  Google Scholar 

  68. Napier, G., & Hansen, C. (2011). Ecosystems for young scaleable firms. Copenhagen: FORA Group.

    Google Scholar 

  69. Neck, H. M., Meyer, G. D., Cohen, B., & Corbett, A. C. (2004). An entrepreneurial system view of new venture creation. Journal of Small Business Management, 42, 190–208.

    Article  Google Scholar 

  70. Nicotra, M., Romano, M., Del Giudice, M., & Schillaci, C. E. (2017). The causal relation between entrepreneurial ecosystem and productive entrepreneurship. Journal of Technology Transfer. https://doi.org/10.1007/S10961-017-9628-2.

    Article  Google Scholar 

  71. OECD. (1998). Fostering entrepreneurship, the OECD jobs strategy. Paris: Organization for Economic Co-operation and Development.

    Google Scholar 

  72. OECD. (2016). Entrepreneurship at a glance 2016. Paris: Organization for Economic Co-operation and Development.

    Google Scholar 

  73. Paelinck, J. H. P. (1974). Qualitative multiple-criteria analysis, environmental protection and multiregional development. Papers of the Regional Science Association, 36, 59–74.

    Article  Google Scholar 

  74. Park, T., & Ryu, D. (2015). Drivers of technology commercialization and performance in SMEs: The moderating effect of environmental dynamism. Management Decision, 53(2), 338–353.

    Article  Google Scholar 

  75. Paulson, A. L., & Townsend, R. (2004). Entrepreneurship and financial constraints in Thailand. Journal of Corporate Finance, 10, 229–236.

    Article  Google Scholar 

  76. Piergiovanni, R., Carree, M. A., & Santarelli, E. (2012). Creative industries, new business formation, and regional economic growth. Small Business Economics, 39, 539–560.

    Article  Google Scholar 

  77. Porter, M. (1990). The competitive advantage of nations. New York, NY: The Free Press.

    Google Scholar 

  78. Porter, M. (1998). Clusters and the new economics of competition (pp. 77–89). Boston: Harvard Business Review.

    Google Scholar 

  79. Roundy, P. T., Brockman, B. K., & Bradshaw, M. (2017). The resilience of entrepreneurial ecosystems. Journal of Business Venturing Insights, 8, 99–104.

    Article  Google Scholar 

  80. Roy, B. (1996). Multicriteria methodology for decision aiding. Dordrecht: Kluwer.

    Google Scholar 

  81. Saviotti, P. P., & Pyka, A. (2004). Economic development, variety and employment. Revue Economique, 55, 1023–1049.

    Article  Google Scholar 

  82. Schilke, O. (2014). On the contingent value of dynamic capabilities for competitive advantage: The nonlinear moderating effect of environmental dynamism. Strategic Management Journal, 35(2), 179–203.

    Article  Google Scholar 

  83. Schillaci, C. E., & Nicotra, M. (2010). Rowing against the tide: The struggle to enhance entrepreneurship in a hostile region. In G. Dossena (Ed.), Entrepreneurship today (pp. 143–162). Milano: McGraw-Hill.

    Google Scholar 

  84. Shane, S., & Venkataraman, S. (2000). The promise of entrepreneurship as a field of research. Academy of Management Review, 25(1), 217–226.

    Google Scholar 

  85. Siegel, D. S., Westhead, P., & Wright, M. (2003). Science parks and the performance of new technology-based firms: A review of recent UK evidence and an agenda for future research. Small Business Economics, 20(2), 177–184.

    Article  Google Scholar 

  86. Sirmon, D. G., Hitt, M. A., & Ireland, D. (2007). Managing firm resources in dynamic environments to create value: Looking inside the black box. Academy of Management Review, 32(1), 273–292.

    Article  Google Scholar 

  87. Spigel, B. (2017). The relational organization of entrepreneurial ecosystems. Entrepreneurship Theory and Practice, 41(1), 49–72.

    Article  Google Scholar 

  88. Stam, E. (2015). Entrepreneurial ecosystems and regional policy: A sympathetic critique. European Planning Studies, 23(9), 1759–1769.

    Article  Google Scholar 

  89. Stam, E., & Spigel, B. (2017). Entrepreneurial ecosystems. In R. Blackburn, D. De Clercq, J. Heinonen, & Z. Wang (Eds.), Handbook for entrepreneurship and small business (pp. 1–15). London: SAGE.

    Google Scholar 

  90. Sternberg, R. (2012). Do EU regional policies favour regional entrepreneurship? Empirical evidence from Spain and Germany. European Planning Studies, 20(4), 583–608.

    Article  Google Scholar 

  91. Tervonen, T., & Figueira, J. R. (2008). A survey on stochastic multicriteria acceptability analysis methods. Journal of Multi-Criteria Decision Analysis, 15, 1–14.

    Article  Google Scholar 

  92. Tervonen, T., Linkov, I., Figueira, J. R., Steevens, J., Chappell, M., & Merad, M. (2009). Risk-based classification system of nanomaterials. Journal of Nanoparticle Research, 11(4), 757–766.

    Article  Google Scholar 

  93. Van de Ven, A. H. (1993). The development of an infrastructure for entrepreneurship. Journal of Business Venturing, 8, 211–230.

    Article  Google Scholar 

  94. Van Praag, M. C. (1999). Some classic views on entrepreneurship. The Economist, 147(3), 311–335.

    Article  Google Scholar 

  95. Verheul, I., Wennekers, S., Audretsch, D., & Thurik, R. (2002). An eclectic theory of entrepreneurship: Policies, institutions and culture. In D. Audretsch, R. Thurik, I. Verheul, & S. Wennekers (Eds.), Entrepreneurship: Determinants and policy in a European-US comparison. Dordrecht: Springer.

    Google Scholar 

  96. Von Bargen, P., Freedman, D., & Pages, E. R. (2003). The rise of the entrepreneurial society. Economic Development Quarterly, 17(4), 315–323.

    Article  Google Scholar 

  97. Wyrwich, M. (2012). Regional entrepreneurial heritage in a socialist and a post-socialist economy. Economic Geography, 88, 423–445.

    Article  Google Scholar 

  98. Zacharakis, A., Shepard, D., & Coombs, J. (2003). The development of venture-capital-backed internet companies: An ecosystem perspective. Journal of Business Venturing, 18, 217–231.

    Article  Google Scholar 

Download references

Author information

Affiliations

Authors

Corresponding author

Correspondence to Melita Nicotra.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Corrente, S., Greco, S., Nicotra, M. et al. Evaluating and comparing entrepreneurial ecosystems using SMAA and SMAA-S. J Technol Transf 44, 485–519 (2019). https://doi.org/10.1007/s10961-018-9684-2

Download citation

Keywords

  • Entrepreneurial ecosystem
  • Stochastic multicriteria acceptability analysis
  • Strategic management analytics and assessment
  • Start-ups

JEL Classification

  • M130