Book Review: Zoltan J. Acs (Ed.),The Knowledge Spillover Theory of Entrepreneurship

Comprising the collection of essays and writings on organisational knowledge and entrepreneurship, dating as far back as 1945, this volume stands as the 18th instalment of a broader series from the International Library of Entrepreneurship. Accompanying such titles as the Economics of Entrepreneurship, Innovation & Entrepreneurship and Entrepreneurship & Regional Development, this book presents the knowledge spillover theory of entrepreneurship and ideas of the knowledge filter, including all theoretical bases and extensions uncovered from this. The volume itself is made up of 25 individual contributions, including many well-established names in the field of entrepreneurship and knowledge, whilst also including modern advancements in theory, such as its application and suitability in declining economies (Acs, Plummer & Sutter, 2009). It is clear to the reader that this work has been developed to provide a clearer understanding of the drivers and role of entrepreneurship in any market economy. In doing so, the collection is designed in a way which presents the focal theory embedded in the surrounding and familiar entrepreneurship literature, allowing the reader to follow an organic thought development to the point where knowledge spillover theory is introduced.

The contributions are organised into seven themed sections each containing three to seven publications seeking to build concise understanding individually, whilst contributing to the overall perspective of the focal theory. Differences in style and approach are evident, particularly as the works span across a significant timeframe; however, the quality of academic writing remains consistent throughout. Initially, Sections I and II consider much of the base literature surrounding the use of knowledge in economies and specifically the application of knowledge to entrepreneurial environments (e.g., this includes seminal works, such as, Hayek, 1945; Lucas, Jr., 1978; Schumpeter, 1947), thus providing sufficient backdrop to the setting in which the main crux of the book is played out. Moving on from this, the smallest section of the book makes reference to an endogenous technical change, a vital element to the knowledge spillover theory. However, this is relatively quickly covered as Sections IV and V move on to the main elements of intra-temporal knowledge spillovers and the influence such spillovers have with regard to new firm formation. In this section, the work of Adam Jaffe, Maryann Feldman and Attila Varga is introduced and applied. This is critically important for the collection as it sets out the original theories of knowledge spillover in the generation of commercial activity. Following this, the central substance of the volume (particularly if the title is to be considered representative of content) is put forward.

Emanating mainly from the pen of Zoltan J. Acs, who contributes four of the five works included, the sixth and penultimate section of the book is entitled ‘Theoretical Extensions and Evidence’. The highlight of this is the inclusion of the recent and pivotal The Knowledge Spillover Theory of Entrepreneurship (Acs et al., 2009). Here, the main themes previously uncovered in the collection are brought together, making the central tenet of the volume read as a logical and in many ways inevitable progression from the preceding literature. The reader is left in no doubt of the theoretical application of knowledge spillover, which develops traditional endogenous growth models to establish the role of entrepreneurial activity in the conversion of knowledge into economic growth. Importantly, the author highlights a key distinction between technological innovation and entrepreneurial behaviour, which is emphasised and explained. Without this caveat, many readers unfamiliar with the topic may be misplaced.

A final section works to place spillover theory in the broader scheme of entrepreneurship, and is entitled ‘The Entrepreneur’. This does appear a little late in the proceedings and gives the impression of an after-thought for inclusion. However, the final four contributions do cover a plethora of important notions, including entrepreneurial traits, labour mobility and the reasoning behind incumbent firm turnover leading to new venture entrepreneurs. Although the juxtaposition of contributions here may be subjective and contentious, each remains relevant to the theory in its own right.

A healthy variety of academic journals and publications are represented throughout this book, with the majority being economic in nature. However, many of the individual contributions appear focused on North American economies (with the exception of Audretsch and Lehmann, 2005, who consider German localities). Although this is understandable, as this is where the knowledge spillover theory of entrepreneurship first appeared, it does become problematic when considering the extension of the theory to other geographically specific areas. Moreover, the book suffers from a lack of a general introduction to the topic. The introduction provided by the editor essentially forwards a further model of spillover theory, where a rationale for the collection put forward would have been more beneficial to the reader. As the book stands, the novice reader would be ill-prepared for the upcoming depth of theory. This, combined with the lack of concluding statement, makes up the main reservations of the volume. The reader is essentially left to draw conclusions from the contributions without any guidance on theoretical place or where such conclusions will lead. Thus, a newcomer to the field of entrepreneurship may struggle to grasp the philosophical reasoning behind much of what this book is attempting to represent, and for this reason may render the volume inappropriate to those not already immersed in the study of entrepreneurial behaviour and economics.

The main strength of this book is in its layout. In a logical and seamless manner, the first six sections flow into each other, building the theory whilst leaving the reader with a sense that each caveat has been systematically satisfied. The volume is an effective vehicle for the focal theory, so those looking for objective critical appraisal may be found wanting. However, as a complete presentation of the main ideas, a comprehensive offering is undoubtedly provided. With a small business bent, many of the contributions focus on the role of individual entrepreneurs in the knowledge economy, many of whom are represented as new ventures. Therefore, readers interested in these areas will find the book of particular value. As with most collective works, a start-to-finish read may be ambitious; however, attempts to ‘cherry pick’ will likely compel the reader to cover more and more of the contributions in order to gain theoretical completion. Entrepreneurship academics and those with any passing interest in knowledge spillover theory will find this text invaluably rewarding. The Knowledge Spillover Theory of Entrepreneurship therefore stands as a welcome contribution to entrepreneurship and management literature.