David B. Audretsch and Max Keilbach
The purpose of this article is to suggest that a more recent literature has emerged which identifies how and why entrepreneurship in the form of new and small firms is a driving engine of industrial restructuring and economic growth. The starting point of this literature is the consideration of entrepreneurial opportunities and how they relate to opportunities generated by incumbent corporations. Entrepreneurship is distinguished from incumbent organizations with respect to both opportunity creation and exploitation. According to the ‘Knowledge Spillover Theory of Entrepreneurship’, entrepreneurial opportunities are not exogenous to the economy, but rather systematically created by incumbent organizations investing in new knowledge and ideas but unable to fully commercialize that new knowledge.
Simon C. Parker
This article surveys the entrepreneurship literature as it relates to the labour market. The purpose of this article is to describe, from a mainly but not exclusively economic perspective, the principal theoretical methods and empirical findings in the field. Entrepreneurship intersects with labour markets in several other ways. For example, human capital theory can be used to help explain entrepreneurs' business performance; and labour supply models can be used to help understand their work effort patterns. Both topics attract policy interest, because policy-makers frequently express interest in promoting successful enterprises, and fostering an ‘enterprise culture’ in which hard work is encouraged and rewarded. Policy-makers also promote entrepreneurship because they believe it creates employment growth and reduces unemployment.