A Framework for the Study of Entrepreneurial Ecosystem

Abstract

Entrepreneurial ecosystem has played a vital role for the development of entrepreneurial culture. In this context, it has become absolutely pertinent to focus on the area where entrepreneurial personality traits and the institutional traits interact. It is accepted that both highly energetic person with entrepreneurial orientation and an encouraging institutional environment is responsible to flourish the entrepreneurial scenario of a country. The interaction between individual’s traits and the institutional variables develop an accurate representation of the ecosystem. To develop a suitable entrepreneurial ecosystem model that can enhance overall entrepreneurial development, it is essential to have detailed knowledge of how personality characteristics interact with institutional variables at different stage of entrepreneurship development i.e. nascent entrepreneurship stage, new business ownership stage and sustainable stage. Global Entrepreneurship Development Institute (GEDI) developed an index by the multiplication of two fundamental components of ecosystem, namely, the individual variable with the proper institutional variable. GEDI identified 14 most important pillars, namely, opportunity perception, startup skills, risk acceptance, networking, cultural support, opportunity startup, technology absorption, quality of human resource, competition, product innovation, process innovation, high growth, internationalization and risk capital that emerge by the interaction between the personal traits with the proper institutional variables. The index consists of three sub-indices such as attitudes, abilities, aspirations and 14 pillars are distributed under three sub-indices. An attempt has been made in the present research study to develop a suitable model that can explain overall entrepreneurial development at different stages, namely, nascent entrepreneurship, new business ownership and sustainable stages by the 14 dimensions of interaction variables under three subindices. The model has been estimated through regression analysis in order to measure the extent of influence of interaction variables on entrepreneurial development stages.