Jarle Aarstad

Performance Spillover Effects in Entrepreneurial Networks: Assessing a Dyadic Theory of Social Capital

We study how social capital induces performance spillover effects in an industry network of entrepreneurs building their own hydroelectric micro–power plants. Most of them are farmers and novices living in rural areas. There is a link between social capital and performance at firm level. By expanding the level of analysis to dyads, we find that entrepreneurs lacking social capital can compensate for this through cohesion with colleagues rich in social capital. Entrepreneurs can also benefit by mimicking the networking patterns of successful colleagues, gaining access to equivalent resources developed in the niche.

Destination Development The Role of Interdestination Bridge Ties

We explore the contribution of interdestination ties to destination development. As destinations search for practices that can be used to improve their co-producing efforts, they make use of actors connecting them to other destinations. Thus, interdestination bridge ties have important roles as information conduits in destination networks. We present a case study showing how public sector actors, multidestination actors, and industry-specific product and service providers play important and complementary roles in this developmental process. The study also indicates that bridge ties can initiate network dynamics. We present a novel set of propositions advancing a network perspective of destinations.

Resource idiosyncrasy, performance, and inter-firm small-world networks

– Many networks take a small-world structure, with a high degree of clustering and shortcut ties that reduce the path-length between the clusters. It can be argued that small-world networks have benefits that are simultaneously related to network closures and the spanning of structural holes, but research on the network members’ performance is nonetheless inconclusive. The purpose of this paper is to argue that the concept of resource idiosyncrasy can explain the mixed findings. Firm idiosyncratic resources are not easily generalizable across enterprises. , – Industries may vary in terms of resource idiosyncrasy, and the paper elaborates how this can moderate shortcut ties’ effect on performance in an inter-firm network. , – If resource idiosyncrasy predominates in an industry, the paper proposes that inter-firm shortcut ties may increase performance, whereas shortcut ties may decrease performance if non-idiosyncratic resources predominate. , – Applying the concept of resource idiosyncrasy as a moderating variable, the paper aims to explain shortcut ties’ effect on performance in an inter-firm network. The theory advanced here can have practical implications and also motivate future empirical studies to gain further knowledge about small-world networks’ effect on performance.

Do Structural Holes and Network Connectivity Really Affect Entrepreneurial Performance

Research shows that structural holes and network connectivity are associated with entrepreneurial performance. Yet the explanatory variables will tend to be correlated, and multicollinearity may skew the results. The use of instrumental variables can nevertheless generate reliable estimates. The methodology can also identify possible reverse causal orders. Here a network of rural entrepreneurs building their own hydroelectric micro-power plants is studied. The use of instrumental variables shows that structural holes and network connectivity have strong and additive effects on performance, and with a particular focus on rural entrepreneurs in developing countries, the findings’ implications are discussed.

Tourism Destination Development and Industries' Scale-Free Distribution

Successful tourism destination development rests upon how actors internalize and integrate a shared strategy. In general, tourism enterprises can manage inter-firm integration on a continuum from conventional and individualistic collaboration with ad hoc coordination, to collaboration administered through common ownership. An advantage of the latter form is that the actors can act in a coherent and unified way. This research note argues how a scale-free distribution – with one or a few dominant and numerous small actors – can enable a destination to achieve an integrated and shared strategy. It also calls for future studies on scaling behaviour in the tourism industry.

Entrepreneurial experience and access to critical resources: a learning perspective

Purpose – Previous studies demonstrate that novice entrepreneurs access fewer resources than experienced portfolio entrepreneurs. From an entrepreneurial learning perspective, the purpose of this paper is to investigate why they differ in terms of accessing critical resources. Design/methodology/approach – The authors studied entrepreneurs in the Norwegian offshore petroleum industry, which is conservative with strict regulatory regimes and overall high-entry barriers, and in which a good reputation is crucial. Hence, the authors argue that the industry is well suited for a study of the research questions. Findings – The novices’ mind-sets were anchored in technological ideas and they had problems in prioritizing the critical business relationships and market opportunities. They were also unwilling to compromise on ownership control and to disclose business secrets. Portfolio entrepreneurs, on the other hand, acknowledged that technology had had little value if they could not convince market actors. There...

Instrumental variables in epidemiological research: an assessment of the adoption rate and future trends

In epidemiological research, the unavailability of possible confounders may lead to inconsistent estimates when a randomized experimental design is not feasible. A related challenge can be possible reverse causal orders between the dependent and the independent variables. This is a so-called endogeneity problem, which is well known in econometrics. 1 However, if possible confounders are unavailable, or we suspect reverse causal orders, the appropriate use of instrumental variables (IVs) can generate consistent estimates. IVs have the properties that they are correlated with the explanatory variables and uncorrelated

Entrepreneurial industry structures and financial institutions as agents for path dependence in Southwest Norway: the role of the macroeconomic environment

ABSTRACT Guided by an evolutionary perspective, we study how macroeconomic shifts as an exogenous factor contribute to the endogenous roles of financial institutions and the entrepreneurial industry structure as indicators for path extension or diversification in Southwest Norway. Path extension implies that new firm formation reproduces itself with limited variation. Path diversification implies a departure from existing paths, in that entrepreneurial activities expand into unrelated or related industries. Between 1992 and 1998, we observe a departure from path extension and an increase in entrepreneurial path diversification into unrelated industries, but this trend declines in the following years. The increase and decline are stronger for Southwest Norway than for the rest of the country. Throughout the whole period of observation (1992–2011), we observe a steady decline in path diversification into related industries. Thus, Southwest Norway, and the country as a whole, experiences an extension of an industry structure that increasingly reproduces itself, which implies stronger path dependence and decreasing diversification of related and unrelated entrepreneurial activity. Financial institutions mostly reinforce path extension, even in periods when abundant capital is available, but to some degree, they also induce related path diversification.

Assessing drivers of export orientation in the subsea oil and gas industry

The purpose of this short study was to identify the drivers of export orientation of firms in the subsea oil and gas industry in Western Norway. As the oil fields in the North Sea are approaching a stage of maturity, gaining knowledge of these drivers is crucial. An online survey was conducted of firms operating in the subsea oil and gas industry in the region. Consistent with previous research, the data reveal that product innovation and a majority share of international ownership increase firms’ export rates. The use of instrumental variables indicates that both product innovation and international ownership are causes of subsea petroleum exports. The study moreover finds that subcontractors have a lower rate of direct exports than system providers, but international ownership in particular boosts subcontractors’ export rates, probably by decreasing their market dependency on regional system providers. A clear recommendation for managers and stakeholders is that they should encourage foreign investments throughout the value chain. The results of such a strategy appear to be especially positive for subcontractors.

Possible suboptimal diffusions of technological innovations in clustered scale-free networks

Many inter-firm networks take a skewed power-law- or scale-free distribution in which one or a few central actors are connected to numerous peripheral actors. Research argues that central actors can act as early adopters and catalysts for the adoption of technological innovations, but studies are inconclusive regarding central actors’ de facto role in this matter. Peripheral actors in scale-free networks tend to cluster, which implies that they are structurally embedded and mutually dependent. A major thesis in this paper is that clustered peripheral actors in scale-free networks may restrict central actors’ propensity to adopt innovations, and as a result impede their diffusion. The paper discusses which implications this may have for stakeholders in the private and public sector domain and practitioners of strategic management.