Abstract:
Entrepreneurship has been recognized as an important element in explaining (regional) economic development. This means that the explanation of regional variations in entrepreneurship has also become an important issue. Even more so because there are pronounced differences within and between nations in rates of entrepreneurship.
Historically, the literature has often explained entrepreneurship as the product either of environments (like provision of venture capital (VC), growing demand) or of personal attributes (like risk-taking propensity, need for achievement). Individuals are heterogeneously endowed with knowledge (bounded rationality, prior knowledge), attitudes, and preferences and environments are heterogeneously endowed with institutions, inputs, and demand for products. The entrepreneurial process depends on entrepreneurial opportunities in the environment and enterprising individuals that identify and exploit these opportunities. Entrepreneurship is the result of the interaction between individual attributes and the surrounding environment.
