Table of Contents

Handbook of Research on Innovation and Entrepreneurship

Handbook of Research on Innovation and Entrepreneurship

Elgar original reference

Edited by David B. Audretsch, Oliver Falck, Stephan Heblich and Adam Lederer

Leading researchers use their outstanding expertise to investigate various aspects in the context of innovation and entrepreneurship such as growth, knowledge production and spillovers, technology transfer, the organization of the firm, industrial policy, financing, small firms and start-ups, and entrepreneurship education as well as the characteristics of the entrepreneur.

Chapter 9: The New Argonauts and the Rise of Venture Capital in the ‘Periphery’

AnnaLee Saxenian and Charles F. Sabel

Subjects: business and management, entrepreneurship, organisational innovation, economics and finance, economics of innovation, innovation and technology, economics of innovation, organisational innovation


AnnaLee Saxenian and Charles F. Sabel The emergence of technology entrepreneurship and innovation outside, but closely connected to, the advanced core of the world economy is one of the most striking features of contemporary capitalism. Israel and Taiwan, both small, peripheral agricultural economies in the postwar period, became home to dynamic clusters of entrepreneurial experimentation in the 1980s and 1990s. Today Taiwan’s specialized producers define the state-of-the-art logistics and flexible manufacturing of low-cost, high-quality electronic systems. Israel, with a population of just over six million, is home to more than a hundred internet security and software-related technology companies listed on NASDAQ, more than any other country outside North America. In both countries venture capital systemically encourages the proliferation of companies that in effect codesign specialized components or subsystems for firms in the core economies. The emergence of clusters of, for example, software firms in mid-income developing economies like China and India is if anything more striking still. Vital urban hubs like Bangalore and Hangzhou are not only peripheral to the world economy, but also located in large national economies that – (partial) liberalization of trade policy aside – lack most of the institutions economists view as preconditions for growth: the rule of law, secure property rights, good corporate governance, flexible labor markets, transparent capital markets and so forth. If it is surprising that firms in the ‘periphery’ can co-design crucial components with firms in the core, then it is at least as surprising that institutions good enough to permit and sustain continuing...

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