Pub Date : 2025-11-01Epub Date: 2025-10-09DOI: 10.1016/j.jbvi.2025.e00576
David J. Rapp , Daniel Leunbach
Effectuation has attracted wide interest and has become an influential branch within the entrepreneurship literature. However, like much of this literature, effectuation research has largely focused on exploring only its bright sides while downplaying or neglecting its not-so-bright sides. This has left critical blind spots on the map of effectuation research. We build on Shepherd's taxonomy of the ‘Triple Ds’—the dark, down, and destructive sides of entrepreneurship—to begin to explore these blind spots and suggest different mechanisms through which the ‘Triple Ds’ of effectuation unfold. Our aim herein is to stimulate further research that expands effectuation beyond its well-trodden paths and sheds light on its neglected dark, down, and destructive sides. This will contribute to a more complete theoretical understanding of effectuation and open up important research avenues that were previously blocked. Moreover, it will also help educators adopt and teach a more balanced and realistic view of effectuation and enable practicing entrepreneurs to make more informed judgments by considering the potential ‘costs’ of applying specific effectuation principles.
{"title":"Too good to be true? Toward an exploration of the ‘Triple Ds’ of effectuation","authors":"David J. Rapp , Daniel Leunbach","doi":"10.1016/j.jbvi.2025.e00576","DOIUrl":"10.1016/j.jbvi.2025.e00576","url":null,"abstract":"<div><div>Effectuation has attracted wide interest and has become an influential branch within the entrepreneurship literature. However, like much of this literature, effectuation research has largely focused on exploring only its bright sides while downplaying or neglecting its not-so-bright sides. This has left critical blind spots on the map of effectuation research. We build on Shepherd's taxonomy of the ‘Triple Ds’—the dark, down, and destructive sides of entrepreneurship—to begin to explore these blind spots and suggest different mechanisms through which the ‘Triple Ds’ of effectuation unfold. Our aim herein is to stimulate further research that expands effectuation beyond its well-trodden paths and sheds light on its neglected dark, down, and destructive sides. This will contribute to a more complete theoretical understanding of effectuation and open up important research avenues that were previously blocked. Moreover, it will also help educators adopt and teach a more balanced and realistic view of effectuation and enable practicing entrepreneurs to make more informed judgments by considering the potential ‘costs’ of applying specific effectuation principles.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00576"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145265200","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-07-15DOI: 10.1016/j.jbvi.2025.e00555
Amrita Lahiri , Alexander Kier , Nanjundi Karthick Krishnan , Aditya Johri , Joyojeet Pal
How does political identification shape entrepreneurial action in the wake of a major policy shock? We investigate this question using survey data from 294 necessity entrepreneurs following India's 2016 demonetization—a disruptive policy that promoted digital payment technologies as a state-endorsed solution. We examine technology adoption as an entrepreneurial response to institutional uncertainty, focusing on how political identification shapes the mobilization of financial and human capital. We find that entrepreneurs aligned with the ruling party were more likely to activate their resources and adopt digital payment technology. By illustrating how identity-driven cognition reduces perceived ambiguity in opportunity evaluation and promotes entrepreneurs' willingness to act, this study offers new insights into entrepreneurial action under institutional uncertainty.
{"title":"Mobilizing under uncertainty: Political identification, resource activation, and technology adoption among necessity entrepreneurs","authors":"Amrita Lahiri , Alexander Kier , Nanjundi Karthick Krishnan , Aditya Johri , Joyojeet Pal","doi":"10.1016/j.jbvi.2025.e00555","DOIUrl":"10.1016/j.jbvi.2025.e00555","url":null,"abstract":"<div><div>How does political identification shape entrepreneurial action in the wake of a major policy shock? We investigate this question using survey data from 294 necessity entrepreneurs following India's 2016 demonetization—a disruptive policy that promoted digital payment technologies as a state-endorsed solution. We examine technology adoption as an entrepreneurial response to institutional uncertainty, focusing on how political identification shapes the mobilization of financial and human capital. We find that entrepreneurs aligned with the ruling party were more likely to activate their resources and adopt digital payment technology. By illustrating how identity-driven cognition reduces perceived ambiguity in opportunity evaluation and promotes entrepreneurs' willingness to act, this study offers new insights into entrepreneurial action under institutional uncertainty.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00555"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144633376","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-12-03DOI: 10.1016/j.jbvi.2025.e00583
Henrik Heinemann , Gavin Williamson , David Gras , Maximilian Weldert , Franz W. Mönke , Philipp Schäpers
Although empirical research on social entrepreneurs has blossomed recently, many studies have relied on a single-item self-classification measure to identify social entrepreneurs in their samples. Many researchers have warned that this measure may have conceptual, and thus psychometric, weaknesses. Responding to these warnings, we test psychometric properties (i.e., reliability, validity, and objectivity) of this measure using a sample of start-up founders (N = 186). We found neither strong reliability (with retests or peer-ratings) nor validity (convergent or nomological), whereas self-classification was substantially influenced by biases and socially desirable responding above and beyond theoretically relevant antecedents. We discuss how psychometric shortcomings of this frequently used measure might affect what we know about social entrepreneurs and call for the development of more suitable measures.
{"title":"Warnings warranted? Psychometric evaluation of a self-classification measure of social entrepreneurship","authors":"Henrik Heinemann , Gavin Williamson , David Gras , Maximilian Weldert , Franz W. Mönke , Philipp Schäpers","doi":"10.1016/j.jbvi.2025.e00583","DOIUrl":"10.1016/j.jbvi.2025.e00583","url":null,"abstract":"<div><div>Although empirical research on social entrepreneurs has blossomed recently, many studies have relied on a single-item self-classification measure to identify social entrepreneurs in their samples. Many researchers have warned that this measure may have conceptual, and thus psychometric, weaknesses. Responding to these warnings, we test psychometric properties (i.e., reliability, validity, and objectivity) of this measure using a sample of start-up founders (N = 186). We found neither strong reliability (with retests or peer-ratings) nor validity (convergent or nomological), whereas self-classification was substantially influenced by biases and socially desirable responding above and beyond theoretically relevant antecedents. We discuss how psychometric shortcomings of this frequently used measure might affect what we know about social entrepreneurs and call for the development of more suitable measures.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00583"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690404","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-09-13DOI: 10.1016/j.jbvi.2025.e00571
Pablo Muñoz
While literature reviews are essential for organizing knowledge, conventional formats often lag behind the fast-moving debates in entrepreneurship research. Too often descriptive, cautious and lengthy, such reviews rarely spark the conceptual or practical innovation needed in dynamic fields. At the Journal of Business Venturing Insights (JBVI), we will open a space for reimagining the review genre, shifting from inventory to insight. To this end, we introduce four new review formats: critical insight review, underexplored intersections, rapid scoping synthesis, and provocative reviews. These are designed to provoke dialogue, challenge assumptions, and illuminate emerging debates. In doing so, we align JBVI with a broader movement across the social sciences toward agile, forward-looking scholarship where reviews function as intellectual activators rather than static summaries.
{"title":"From inventory to insight: Reimagining reviews for JBVI","authors":"Pablo Muñoz","doi":"10.1016/j.jbvi.2025.e00571","DOIUrl":"10.1016/j.jbvi.2025.e00571","url":null,"abstract":"<div><div>While literature reviews are essential for organizing knowledge, conventional formats often lag behind the fast-moving debates in entrepreneurship research. Too often descriptive, cautious and lengthy, such reviews rarely spark the conceptual or practical innovation needed in dynamic fields. At the Journal of Business Venturing Insights (JBVI), we will open a space for reimagining the review genre, shifting from inventory to insight. To this end, we introduce four new review formats: <em>critical insight review</em>, <em>underexplored intersections</em>, <em>rapid scoping synthesis, and provocative reviews.</em> These are designed to provoke dialogue, challenge assumptions, and illuminate emerging debates. In doing so, we align JBVI with a broader movement across the social sciences toward agile, forward-looking scholarship where reviews function as intellectual activators rather than static summaries.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00571"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145048323","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
By adopting a sequential mixed-method research design, this study investigates the dynamics of Entrepreneurial Ecosystems (EEs) and their influence on the financial performance of hospital facilities, as well as the mediating role of innovation. The analysis is focused on the Italian context and is structured around three interrelated research phases that integrate qualitative and quantitative methodologies. Main findings suggest that stronger EEs enhance the financial performance of Italian private healthcare organisations by fostering access to resources and collaboration. Besides, innovation has a nuanced mediating effect: while R&D investments support long-term innovation, tangible outputs such as patents are crucial for generating positive financial returns. As one of the first studies linking EEs to financial outcomes in healthcare, the paper highlights the distinct roles of innovation inputs and outputs. These findings offer insights into the complex mechanisms through which EEs influence financial performance, supporting strategic policy and management decisions.
{"title":"Opening the black box: Exploring innovation pathways from entrepreneurial ecosystems to financial performance in healthcare organisations","authors":"Marika Intenza , Nunzia Capobianco , Fabrizia Sarto , Sara Saggese","doi":"10.1016/j.jbvi.2025.e00586","DOIUrl":"10.1016/j.jbvi.2025.e00586","url":null,"abstract":"<div><div>By adopting a sequential mixed-method research design, this study investigates the dynamics of Entrepreneurial Ecosystems (EEs) and their influence on the financial performance of hospital facilities, as well as the mediating role of innovation. The analysis is focused on the Italian context and is structured around three interrelated research phases that integrate qualitative and quantitative methodologies. Main findings suggest that stronger EEs enhance the financial performance of Italian private healthcare organisations by fostering access to resources and collaboration. Besides, innovation has a nuanced mediating effect: while R&D investments support long-term innovation, tangible outputs such as patents are crucial for generating positive financial returns. As one of the first studies linking EEs to financial outcomes in healthcare, the paper highlights the distinct roles of innovation inputs and outputs. These findings offer insights into the complex mechanisms through which EEs influence financial performance, supporting strategic policy and management decisions.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00586"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145748218","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-06-28DOI: 10.1016/j.jbvi.2025.e00551
Johannes Hähnlein , Matthias Baum , Carolin Durst
Entrepreneurs benefit significantly from resources within their entrepreneurial ecosystems, but under what conditions do they decide to contribute back (a mechanism called downward causation) and thus revitalize the ecosystem they originated from? Drawing on social exchange theory, we develop a set of drivers of such contribution behaviors and test their influence through a metric-conjoint experiment involving 234 entrepreneurs. Our findings confirm the impact of social exchange theory constructs on entrepreneurs' contribution behaviors and highlight the moderating effects of personal traits—in particular, self-interest and other-orientation—on these dynamics. The key insight of our study is that social exchange structures and entrepreneurs’ relational contexts shape contribution behaviors that underlie the microfoundational dynamics of ecosystem development. This investigation underscores the importance of social structures within entrepreneurial ecosystems and enhances our understanding of the micro-level mechanisms that sustain ecosystem health and development. Furthermore, it offers practical insights that transcend traditional policy approaches, focusing on tailored strategies for cultivating entrepreneur-centered ecosystems.
{"title":"Cultivating the ecosystem: How social exchange sows the seeds of entrepreneurial contributions","authors":"Johannes Hähnlein , Matthias Baum , Carolin Durst","doi":"10.1016/j.jbvi.2025.e00551","DOIUrl":"10.1016/j.jbvi.2025.e00551","url":null,"abstract":"<div><div>Entrepreneurs benefit significantly from resources within their entrepreneurial ecosystems, but under what conditions do they decide to contribute back (a mechanism called downward causation) and thus revitalize the ecosystem they originated from? Drawing on social exchange theory, we develop a set of drivers of such contribution behaviors and test their influence through a metric-conjoint experiment involving 234 entrepreneurs. Our findings confirm the impact of social exchange theory constructs on entrepreneurs' contribution behaviors and highlight the moderating effects of personal traits—in particular, self-interest and other-orientation—on these dynamics. The key insight of our study is that social exchange structures and entrepreneurs’ relational contexts shape contribution behaviors that underlie the microfoundational dynamics of ecosystem development. This investigation underscores the importance of social structures within entrepreneurial ecosystems and enhances our understanding of the micro-level mechanisms that sustain ecosystem health and development. Furthermore, it offers practical insights that transcend traditional policy approaches, focusing on tailored strategies for cultivating entrepreneur-centered ecosystems.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00551"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144510940","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-09-09DOI: 10.1016/j.jbvi.2025.e00569
Jacob A. Waddingham , Debby Osias , Phillip E. Davis
A growing area of interest in the entrepreneurship literature examines the communal spaces where maker entrepreneurs interact, create, and sell their novel artifacts. However, we know surprisingly little about how these individuals communicate their entrepreneurial endeavors to their local community, and how this communication affects key stakeholder engagement. Using a unique social media dataset of 48 maker entrepreneurs who participated in a community-based event, we find support for our theorizing. Our results reveal a negative relationship between agentic language and online stakeholder engagement, whereas communal language is positively related to stakeholder engagement. Interestingly, the negative relationship between agentic language and online stakeholder engagement is stronger for local maker entrepreneurs. Supplemental interviews with maker entrepreneurs provide additional insights into their feedback-seeking behaviors and networking within the maker community.
{"title":"The effect of maker entrepreneur's agency and communion language on stakeholder engagement","authors":"Jacob A. Waddingham , Debby Osias , Phillip E. Davis","doi":"10.1016/j.jbvi.2025.e00569","DOIUrl":"10.1016/j.jbvi.2025.e00569","url":null,"abstract":"<div><div>A growing area of interest in the entrepreneurship literature examines the communal spaces where maker entrepreneurs interact, create, and sell their novel artifacts. However, we know surprisingly little about how these individuals communicate their entrepreneurial endeavors to their local community, and how this communication affects key stakeholder engagement. Using a unique social media dataset of 48 maker entrepreneurs who participated in a community-based event, we find support for our theorizing. Our results reveal a negative relationship between agentic language and online stakeholder engagement, whereas communal language is positively related to stakeholder engagement. Interestingly, the negative relationship between agentic language and online stakeholder engagement is stronger for local maker entrepreneurs. Supplemental interviews with maker entrepreneurs provide additional insights into their feedback-seeking behaviors and networking within the maker community.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00569"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145019081","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-09-23DOI: 10.1016/j.jbvi.2025.e00573
Nele Marie Terveen
{"title":"Navigating complex problem spaces: How emotion and energy shape entrepreneurial agency in serendipitous encounters","authors":"Nele Marie Terveen","doi":"10.1016/j.jbvi.2025.e00573","DOIUrl":"10.1016/j.jbvi.2025.e00573","url":null,"abstract":"","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00573"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145117855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-07-31DOI: 10.1016/j.jbvi.2025.e00559
Mark van der Giessen , Anastasia Koptsyukh , Farah Kodeih , Sophie Alkhaled , Anastasiia Poberezhna , Marjolein Wesselius den Boer
This rapid response paper seeks to support Sanctuary Ukraine (SU), a municipality-led initiative that has augmented its traditional governmental work with social entrepreneurship practices to provide services for Ukrainian refugees. SU initially focused on emergency reception and housing services with the support of external NGOs and volunteer groups. However, as the Russia-Ukraine war persists well into 2025—and with it the prolonged displacement of Ukrainian residents—SU has increasingly shifted its focus toward activities aimed at empowering refugees over the long term. We identify three problems that have emerged during this transition, and drawing on existing evidence in the academic literature, we offer concrete recommendations for adapting SU's activities (taking a translational research approach). First, we propose strategies for nurturing community collaboration toward common goals to mitigate competition and conflict that can arise within a fragmented refugee community. Second, we show how refugee identity narratives can be grounded in a sense of personal value and belonging to foster commitment to integration among refugees who feel caught between repatriation and settling in the host country. Lastly, we suggest ways in which institutional structures and processes can be leveraged to shelter refugees from the debilitating effects of prolonged and indeterminate uncertainty.
{"title":"From emergency relief to empowerment: Transitioning government-led social entrepreneurship practices to support Ukrainian refugees","authors":"Mark van der Giessen , Anastasia Koptsyukh , Farah Kodeih , Sophie Alkhaled , Anastasiia Poberezhna , Marjolein Wesselius den Boer","doi":"10.1016/j.jbvi.2025.e00559","DOIUrl":"10.1016/j.jbvi.2025.e00559","url":null,"abstract":"<div><div>This rapid response paper seeks to support Sanctuary Ukraine (SU), a municipality-led initiative that has augmented its traditional governmental work with social entrepreneurship practices to provide services for Ukrainian refugees. SU initially focused on emergency reception and housing services with the support of external NGOs and volunteer groups. However, as the Russia-Ukraine war persists well into 2025—and with it the prolonged displacement of Ukrainian residents—SU has increasingly shifted its focus toward activities aimed at empowering refugees over the long term. We identify three problems that have emerged during this transition, and drawing on existing evidence in the academic literature, we offer concrete recommendations for adapting SU's activities (taking a translational research approach). First, we propose strategies for nurturing community collaboration toward common goals to mitigate competition and conflict that can arise within a fragmented refugee community. Second, we show how refugee identity narratives can be grounded in a sense of personal value and belonging to foster commitment to integration among refugees who feel caught between repatriation and settling in the host country. Lastly, we suggest ways in which institutional structures and processes can be leveraged to shelter refugees from the debilitating effects of prolonged and indeterminate uncertainty.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00559"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144749584","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-12-04DOI: 10.1016/j.jbvi.2025.e00585
Shuai Shi , Ruiyang Wang , Zhaoyingzi Dong
Promoting entrepreneurship has become a quintessential objective for cities aiming to achieve sustainable economic growth. However, a critical question remains unexamined: What extra costs do residents have to pay for living in an entrepreneurial city? We address this question by examining the impact of venture capital (VC)-backed entrepreneurship on housing prices in Hangzhou. VC investments not only offer financial support for high-growth startups but also boost market confidence for the locations where VC-backed startups are concentrated. From 2013 to 2019, a total of 3,101 Hangzhou-based startups secured VC investments, positioning the city as one of China's most entrepreneurial hubs. To address the endogeneity issue, we construct an instrument variable (IV) grounded in startups' alignment with government-prioritized strategic sectors and find that 1 % increase in the scale of startup clusters can inflate the price of proximate housing properties by 0.0434 %. Further, three mechanisms are identified behind this phenomenon, including increased housing demand, innovation-induced land premiums, and capital agglomeration effects. The key insight of our study is that, beyond creating economic gains, the clustering of VC-backed startups paradoxically inflates nearby housing prices, ringing an alarm for tech-led gentrification. This calls for policy interventions to balance innovation growth with housing affordability in entrepreneurial cities.
{"title":"The paradox of entrepreneurial cities: How business venturing inflates housing prices in China’s Silicon Valley","authors":"Shuai Shi , Ruiyang Wang , Zhaoyingzi Dong","doi":"10.1016/j.jbvi.2025.e00585","DOIUrl":"10.1016/j.jbvi.2025.e00585","url":null,"abstract":"<div><div>Promoting entrepreneurship has become a quintessential objective for cities aiming to achieve sustainable economic growth. However, a critical question remains unexamined: What extra costs do residents have to pay for living in an entrepreneurial city? We address this question by examining the impact of venture capital (VC)-backed entrepreneurship on housing prices in Hangzhou. VC investments not only offer financial support for high-growth startups but also boost market confidence for the locations where VC-backed startups are concentrated. From 2013 to 2019, a total of 3,101 Hangzhou-based startups secured VC investments, positioning the city as one of China's most entrepreneurial hubs. To address the endogeneity issue, we construct an instrument variable (IV) grounded in startups' alignment with government-prioritized strategic sectors and find that 1 % increase in the scale of startup clusters can inflate the price of proximate housing properties by 0.0434 %. Further, three mechanisms are identified behind this phenomenon, including increased housing demand, innovation-induced land premiums, and capital agglomeration effects. The key insight of our study is that, beyond creating economic gains, the clustering of VC-backed startups paradoxically inflates nearby housing prices, ringing an alarm for tech-led gentrification. This calls for policy interventions to balance innovation growth with housing affordability in entrepreneurial cities.</div></div>","PeriodicalId":38078,"journal":{"name":"Journal of Business Venturing Insights","volume":"24 ","pages":"Article e00585"},"PeriodicalIF":0.0,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690405","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}