Local Knowledge Base and Entrepreneurial Opportunities in Regions: A Configurational Perspective

According to the central hypothesis of the knowledge spillover theory of entrepreneurship – the more knowledge is produced in a region, the more entrepreneurial opportunities are available in it. Recent research extended the theory further, showing that the level of entrepreneurial activities, depends on the configuration of the local knowledge base not only on its size. This paper is aimed at discovering which knowledge profiles are more (and which less) supportive of creating entrepreneurial opportunities. It is motivated by disagreements and conflicting evidence on fundamental matters across all three frequently used dimensions - the type of knowledge source that contributes to new knowledge within a region (i.e., universities or private incumbent firms); the presence/absence of a dominant source of new knowledge within a region (i.e., an anchor tenant); and the specialization/diversity of technological knowledge that is created within a region. We analyze data from 33 regions using statistics on patent filings between 2011 and 2015 and a number of created startups in these regions. Using fuzzy-set Qualitative Comparative Analysis (fsQCA) we confirm that a region’s potential for knowledge spillovers, and, thus, entrepreneurial activities, depends on the configuration of the local knowledge base, specifying what configurations are antecedent to creating more entrepreneurial opportunities. Our analysis also shows low synergy from the simultaneous presence of knowledge created by universities and industry in a given area, as these two are, under some conditions, substituting each other in stimulating knowledge-intensive entrepreneurship at the local level. Third, we show that the specialization/diversity of technological knowledge that is created within a region does not play an important role in creating a high number of entrepreneurial opportunities. These findings bring a new perspective and contribute to settling down some of the lasting debates, opening opportunities for further research and rethinking policy measures.