8. meijaard, brouwer and van der veen open and less open networks


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8. meijaard, brouwer and van der veen open and less open networks

  1. 1. Entrepreneurial Ecosystems Positive and Normative Insights from the Netherlands OECD Workshop, 7 November 2013, The Hague Meijaard, Brouwer and Van der Veen
  2. 2. Overview • Macro-Meso-Micro: Collecting Data on 3 Levels • Legitimacy of Policies • Empirical Study • Case Study • Discussion
  3. 3. Macro Benchmarking ‘Framework Conditions’
  4. 4. Insight into causalities and leverage Determinants of fast-growth firm levels Short term: Income tax Access to Finance Long term: Attitudes towards entrepreneurship Smaller government Determinants of fast-growth firm dynamics Short term: Exit and Entry burdens Flexibility of labour Long term: R&D collaboration Smaller government
  5. 5. Meso Insights into Regional, Sectoral and Value Chain Ecosystems
  6. 6. Micro Benchmarking on a Local Level (Survey Stratifications)
  7. 7. WEF Stanford Team, 2013
  8. 8. But then, if one knows things well: What to do? • By and large: Entrepreneurs should make ‘unbiased’ decisions • Intervene: Only if market failure and/or welfare losses – – – – – Externalities & Spill-overs: too low levels of activity Network effects Information Asymmetries: Growth barriers Natural monopolies Public goods
  9. 9. Empirical study Networks and firm boundaries
  10. 10. Empirical study of networks • What can we say about the relationship between networks, transaction costs and business growth? • What is the role of the government? • Interviews with different stakeholders: companies, municipalities, business networks, triple helix networks, chamber of commerce etc. Focus on companies. • Internet survey among business owners
  11. 11. Network as public good? • A network is a semi public good: non-rivalrous, but excludable • Network effects themselves are not a public good: Only participants of network benefit • Degree of organization of a sector can be low due to complex externalities (free rider effects) • Information exchange between actors => knowledge development, due to learning and inspiration • Knowledge creation is a positive externality • Policy: facilitate creation of networks for knowledge devemopment • Other topics?
  12. 12. Findings empirical research • Network is our capital (Y = ANLK ) • Business networks evolve with the growth of companies – Startups -> encouter people (hence, business networks) – Early growth and market growth -> cooperation much more important • Cooperation: to develop knowledge, to innovate. Also, to increase the market (e.g. hubs for transport). To increase market power (e.g. FloraHolland) • Complex externalities, due to many actors, could lead to underdevelopment of networks • Clustereffects: due to many ties, many places to encouter etc. companies work together more often: solve problems, exploit opportunities
  13. 13. Triple Helix • Triple Helix cooperation: – Structure and organization important – Vision should be developed in close cooperation with companies, bottum up – Put resonsibilties where they belong – Qualities of people, experience not neccesarily good, comes to people management, inspiration, bringing people together etc. – Specific implementation agenda, what are we going to do? – This way companies see the real value of cooperation with govenment and knowledge institutions
  14. 14. Policy Recommendations • Stimulate the creation of networks to create knowledge development (through networks), the market should be in the lead • When there are complex externalities, increase the level of organization in a sector. It wil also lead to increased cooperation on different fields • Simply increase visibility of the government in networks, this is mutually beneficial • Trade missions are highly valued to enter foreign markets, incoming trade mission should be improved
  15. 15. Case Study Co-evolution
  16. 16. LED-ecosystem In a business ecosystem companies co-evolve capabilities around a new innovation, work cooperatively and competitively (co-opetition) to support new products, satisfy customer needs, and eventually incorporate the next round of innovations*. The Dutch LED lighting – ecosystem: ± 260 SME’s (hightech/ICT), some large firms, knowledge and public institutions • Goal: share knowledge around fast developments in LED lighting amongst companies that develop, design, produce and sell innovative products based on LEDtechnology • Need: a recognizable, independent network where upto-date knowledge about technological en market developments is available • Role government/Syntens: connect (potential) participants, inform (LEDtalks, Q&A), connect initiatives to boost an internationally recognised cluster -> Roadmap Lighting Topsector HTSM *Moore, 1993, Predators and prey: A New Ecology of Competition, Adner & Kapoor, 2010, Value creation in innovation
  17. 17. Discussion • What are good reasons for the government to initiate specific business networks? • Which conditions should be ‘managed’ in relation to the entrepreneurial ecosystem – Short run (to correct e.g. deadweight growth barriers) – Long run (i.e. to correct market failure) • In which other fields than knowledge development should governments stimulate the creation of networks?