Building entrepreneurial communities: the appropriate role of enterprise development activities.

ABSTRACT

This article examines the concept of building entrepreneurial communities as a strategy for community economic development. It begins by attempting to define what is meant by the term "entrepreneurial community" and to clarify how economic developers go about trying to create such places--using activities known as the "enterprise development" to help entrepreneurs grow new business. The article then analyzes the current approach to enterprise development and explains why it is incapable of producing entrepreneurial communities. The authors conclude by calling for a systemic and transformational approach to enterprise development that can truly yield community- wide economic development.

Keywords: community economic development, entrepreneurship, entrepreneurial communities, enterprise development

INTRODUCTION

Enterprise development is growing in popularity as an approach to community economic development. Its goals are to create wealth for owners and employees by helping entrepreneurs start and grow their businesses. Enterprise development is arguably more sustainable, more cost-effective and more attuned to community development than its sister economic development strategies of business attraction and business retention/expansion (Harrison & Kanter, 1978; Dabson, Rist, & Schweke, 1994; Lyons & Hamlin, 2001).

Recently, the discussion about enterprise development has begun to shift from asking how communities can help entrepreneurs to raising a much broader and more inspiring question: "How can we build entrepreneurial communities?" This, of course, leads to a number of other questions: "What is an entrepreneurial community?" Can they be created and, if so, how? And why have our current approaches to enterprise development not been successful in producing such communities across the country?

This paper seeks to address these questions by first offering a definition of entrepreneurial community. We then examine the current major approaches to enterprise development in light of this definition, pointing out their limitations. Our conclusions are based on in-depth diagnoses conducted in dozens of different regional and community settings-urban, rural, high-tech, manufacturing-oriented, disadvantaged, etc.--throughout the world. Finally, we offer a set of guiding ideas, based on years of specific action research projects, as to how local communities might realistically organize themselves to become entrepreneurial communities (See Argyris, Putman, & Smith, 1985; Bourdieu, 1990; Bourdieu & Wacquant, 1992; Lewin, 1951; Schon, 1983; Schon, 1987; Whyte, 1986; and Whyte et al., 1991, regarding action research methods and their scientific foundations).