Place-Based Innovation Policies are Important for Building Entrepreneurial Ecosystems
“Growing Entrepreneurial Communities,” an article published in the Journal of Entrepreneurship and Public Policy, traces how place-based innovation policies have helped to develop an entrepreneurial ecosystem in Ontario, Canada. Place-based innovation policies are policies that promote entrepreneurship development with region-specific challenges in mind.
The authors Allison Bramwell, Nicola Hepburn, and David A. Wolfe define a successful entrepreneurial ecosystem as a regional culture supportive of innovation with leadership, access to capital, markets, and a range of institutional support typically enabled by public policy. Below are highlights on why place-based innovation policies are important for entrepreneurial ecosystem development.
- Place-based innovation policies build an entrepreneurial ecosystem with context-specific policy objectives in mind. In the case of Ontario, the region has strong automotive and advanced manufacturing sectors as well as a high concentration of research universities across the province. In 2005, the Ontario government established the Ministry of Research and Innovation to connect the region’s robust research university network to entrepreneurship development within these high-growth sectors.
- Place-based innovation policies support local institutions in their efforts to address community needs. Often, local institutions providing a sense of ‘place’ and services for entrepreneurship help to create more opportunities for entrepreneurs to build a network of valuable relationships. Previous Endeavor research found that regions with a high number of entrepreneurial network connections are often more productive. In Ontario, the Ministry of Research and Innovation funds over 14 organizations called Regional Innovation Centers (RIC) across the province. Entrepreneurs have access to the networks of all RICs regardless of where they are based.
- Place-based innovation policies have shown to be especially impactful in smaller, rural and peripheral cities that do not presently have an established entrepreneurial hub. Given its bottom-up approach, place-based policies can better address the economic development needs of such communities. Since 2005, Ontario has seen an increase of entrepreneurial activity especially in smaller communities outside of Toronto, the province’s capital city.
Place-based innovation policies have the potential to help facilitate the development of entrepreneurial ecosystems, which can stimulate economic activity in a region. These findings align with previous studies highlighted by Endeavor Insight on cultural contexts and shaping entrepreneurial policies.
The full report can be accessed here.
Contributed by Penmai Chongtoua.