Entrepreneurship and Innovation Today

Entrepreneurial & Opportunity Brain Drain in USA and Europe**

People create opportunities. So any abrupt changes in migration and immigration flows and patterns matters a great deal. Many studies have shown that highly educated immigrants have a higher likelihood of starting new business ventures then the general population at large, so immigrant influx into Canada and the USA are critical in maintaining a global competitive edge. Immigrant entrepreneurs where largely responsible for many of the startups in Silicon Valley.

So it’s disturbing to see a study [1] that reports  that immigrants with advance education are increasingly likely to return home after taking advanced degrees in the US, leaving the country that trained them facing potential skills shortages and increased competition. This bodes well for emerging markets but not for western developed economies. “A combination of changing perceptions about where opportunity lies, rising nationalist sentiment in the face of a global recession, and poorly thought-out immigration policies, is said to have caused the shift in sentiment and behavior” observe researchers. Among the other reasons given for leaving the U.S.were better economic opportunities at home, a desire to be with friends and family, and concerns about job prospects and the availability of visas

Data also supports that the same is happening with foreign students studying in Europe. Researchers see a fair amount of returnees from Europe, attracted back to China and India due to the opportunities in their home countries. If countries do not provide an innovation-friendly overall environment, where highly skilled workers can use, create and disseminate knowledge, then attracting more workers might not lead to better innovation and economic growth outcomes anyway.

In October 2008, the above researchers [1] polled 1,224 foreign nationals from Facebook, who were either studying in U.S. institutions of higher learning, or recent graduates. They found that only 25% of Indian students, 9% of European students and  7% of Chinese students, thought the best days for the American economy lay ahead. More significantly,  74% of Chinese students and 86% of Indian students felt the best days for their home country's economies lay ahead.

Other disturbing results for America showed that only 6% of Indian, 10% of Chinese and 15% of Europeans intended to settle permanently in the United States. The number of graduates who wanted to stay in the U.S.for a few years also fell, with only 58% of Indian, 54% of Chinese and 40% of European students wanting to stay on. Earlier National Science Foundation research showed that 92% of Chinese students and 85% for Indian students stayed for five years or more. [2]

The students polled were also more of an entrepreneurial group; 64% of Indian, 66% of European and 68% of Chinese students said they wanted to start a business in the next decade, with most of the Indian and Chinese students hoping to do so in their home countries.

[1} Losing the World's Best and Brightest: America's New Immigrant Entrepreneurs, Part V, a study sponsored by the Ewing Marion Kauffman Foundation

[2] West 'Hemorrhaging' Its Best Brains, Study Claims Luke Collins. Research Technology Management. Arlington: Jul/Aug 2009. Vol. 52, Iss. 4; pg. 2, 4 pgs

 

**An excerpt From the soon-to-be-released book -Hard Times, Golden Opportunites by Walter Derzko;  publisher-J Wiley and Sons

Assessing expatriates' affective fit in host cultures with the intercultural communication affinity scale

With new immigrants (potential managers or entrepreneurs) settling in all parts of the world, this is a very timely article in the current European J. of International Management 2008 - Vol.  2, No.3 pp.  234 - 249

The title is Moscow on the Hudson: assessing expatriates' affective fit in host cultures with the intercultural communication affinity scale

Author: Bernd Kupka, Andre M. Everett Address: University of Wisconsin Green Bay, Department of Management, Green Bay, WI 54311-7001, USA.  ' University of Otago, Department of Management, P.O. Box 56, Dunedin, New Zealand

Journal: European J. of International Management 2008 - Vol.  2, No.3 pp.  234 - 249

Abstract: Increasing scale and scope of international activities, particularly by European companies, poses mounting challenges for strategic international human resource management.  As the level of complexity of international assignments rises, so too does the cost of failure.  Corporate representatives sent as expatriates are often ill-prepared to cope with the intercultural differences they encounter.  One socially responsible solution to enhance expatriates' success rate, while meeting corporate objectives, is more adequately to prepare the envoys prior to and during their overseas mission.  The authors argue that a key to this process is the evaluation of candidates' intercultural affinity, both as a selection criterion and for training needs assessment.  This article first illustrates the importance of intercultural affinity, secondly describes its theoretical roots and forwards a definition and, thirdly, introduces a scale to measure intercultural affinity. 

Keywords: affective fit; expatriate selection; intercultural affinity; strategic international HRM; human resource management; training needs assessment; host country; culture; expatriates.

DOI: 10.1504/EJIM.2008.019695

Call for Papers - International Journal of Innovation and Regional Development (IJIRD) Special Issue on: "Community-based Entrepreneurship"

Deadlines: Manuscript due: 30 June 2008, Acceptance notification: 30 August 2008

Guest Editors: Vanessa Ratten, Duquesne University, United States Leo Dana, University of Canterbury, New Zealand Isabell M. Welpe, Max-Planck-Institute of Economics, Germany/ Ludwig-Maximilians-University, Germany Mary Han, Ryerson University, Canada

Since Johannisson and Nilsson's (1989) seminal paper on community-based entrepreneurship, the literature on how regional development is facilitated by community interaction has grown. The increasing sentiment of people and businesses worldwide to "act locally but think globally" has meant that community-based entrepreneurship is becoming more important in encouraging businesses and public policy practitioners to focus on the significance of people working together to facilitate regional development (Kapelus, 2002; Lyons, 2002). In this special issue, we define community-based entrepreneurship as "a community acting corporately as both entrepreneur and enterprise in pursuit of the common good" (Peredo and Chrisman, 2006:310).

Thus, community-based entrepreneurship involves a process through which new enterprises are created and operate in a communities existing social structure (Peredo and Chrisman, 2006). The economic and social role of community-based entrepreneurship has been recognized by a growing number of disciplines, including sociology, management and urban studies (e.g., Bull and Winter, 1991; Johannisson and Nilsson, 1989; Light and Karageorgis, 1994; Mezias and Kuperman, 2001; Selsky and Smith, 1994). Community-based entrepreneurship is encouraged through personal networking that influence local venturing processes and regional development (Johannisson and Nilsson, 1989). This special issue takes a multi-disciplinary perspective to help examine the role of community-based entrepreneurship in the international context. Thus, the aim of the special issue is to study how community-based entrepreneurship is encouraging regional development as people become part of a number of different communities worldwide. In this special issue, we are looking for new theoretical insights and empirical studies that will contribute to the literature on community-based entrepreneurship.

Subject Coverage

Papers should address research questions in the field, including but not limited to the following topics:

- Market conditions for community-based entrepreneurship (openness of markets, regulations, transparency of market and resource mobilization).

- The importance of cognitions and emotions in community-based entrepreneurship.

- The role of human resource management practices and in community-based entrepreneurship.

- Public perception of community-based entrepreneurship.

- The antecedents and consequences of family participation in various aspects of community-based entrepreneurship.

- How has community-based entrepreneurship influenced regional development in global contexts and will this change in the future?

- Comparative differences in community-based entrepreneurship by countries, city, ethnic/national subgroup, sector and periods.

- The role of social capital and social networks in community-based entrepreneurship.

- The role of technological innovation in community-based entrepreneurship.

- The importance of communities for the perception, evaluation and exploitation of entrepreneurial opportunities.

Notes for Prospective Authors

Submitted papers should not have been previously published nor be currently under consideration for publication elsewhere All papers are refereed through a peer review process. A guide for authors, sample copies and other relevant information for submitting papers are available on the Author Guidelines page

Important Dates

Manuscript due: 30 June 2008

Acceptance notification: 30 August 2008

Final manuscript due: 30 October 2008

Editors and Notes

You may send one copy in the form of a pdf file attached to an e-mail (details in Author Guidelines) to the following:

Prof. Vanessa Ratten, A.J. Palumbo School of Business Administration Duquesne University Pittsburgh United States.  Tel: +1 412 396 1907,  Email: [email protected]

with copies to

Prof. P. Ketikidis, Editor-in-Chief, IJIRD, Email: [email protected]

and

IEL Editorial Office;  E-mail: [email protected]

Please include in your submission the title of the Special Issue, the title of the Journal and the name of the Guest Editor

Innovation and Entrepreneurship in Ukraine

My colleague Jeremy Hall, a business professor and policy analyst from Simon Fraser University (SFU) in BC (formally at Univ of Calgary) has an interesting theory about entrepreneurship development in emerging transition economies like Bosnia, Russia, Ukraine or in South America (Columbia or Brazil).

I met Jeremy again last week at a conference on Innovation in Calgary where we both spoke.

Over coffee we touched on the growth of entrepreneurship in Ukraine.  (see note below)

Hall compares entrepreneurial cultures on 2 scales (Education vs Alertness) Cultures that are well educated vs uneducated & Alert vs Myopic

So from a 2x 2 matrix you get 1) Uneducated & Myopic, or a Superstitious Culture; 2) Uneducated and Alert, or an Underdog Culture 3) Educated and Myopic, an Arrogant Culture and 4) Educated and Alert. a Superstar Culture

Here, I would classify Ukraine and its entrepreneurs (both SME and oligarchs) into 2 groups; Educated-Myopic (Arrogant) and/or Educated –Alert (potential to be a Superstar) according to Hall’s definitions

From this Hall next outlines 4 type of consequences:

1) Culture of Innovation; High Education; High Alertness; Attributes: Driven, visionary, able to see re-combinations, connections; Outcome: Productive

2) Culture of Complacency; High Education; Low Alertness: Attribututes: Arrogant, Overly confident Complacent; Outcomes: Unproductive

3) Culture of Stagnation; Low Education; Low Alertness; Attributes: Superstitious, ignorant, discouraged; Outcomes: Destructive/ unproductive

4) Culture of Corruption; Low Education; High Alertness; Attributes: Malicious Machiavellian manipulative; Outcomes: Destructive

I might classify Ukraine as a mixture of 3 cultures:

1) A culture of corruption (hopefully the next Verhovna Rada (parliament) & Yulia Tymoshenko should address these issues more thoroughly, and here I have in mind corrupt politicians and bureaucrats that deal with business at all levels as well as corrupt business owners themselves)

2) a culture of complacency (needs work and state vision-building) and

3) a growing culture of innovation (islands of genius, which need fostering, ....Ukrainian breakthrough research on quantum computing used by D-Wave in Vancouver, and other worldclass platform technologies developed in Ukraine such as hydrated fullerenes and other nanotechnologies, super caps etc) …..which leads to some hope for the future.

Jeremy says:

"Walter, as discussed, I'm very interested in your thoughts about what's going on in the Ukraine.  I've done some field studies in Bosnia a few years ago, and suspect that Ukraine is undergoing similar transitions - entrepreneurship as a panacea, yet a lack of understanding of what that may entail - i.e. unproductive or destructive outcomes.  In Bosnia we found that the potential entrepreneurs were well educated but myopic, and we remain perplexed as to how this may be changed, given the physical and perhaps more important mental scares suffered by our interview subjects."

Do you agree? disagree? have a new point of view? comments welcomed

What is the value of entrepreneurship? A review of recent research

What is the value of entrepreneurship?  A review of recent research C Mirjam van Praag, Peter H Versloot.  Small Business Economics.  Dordrech: Dec 2007.  Vol.  29, Iss.  4; pg.  351, 32 pgs

Abstract (Summary)

This article examines to what extent recent empirical evidence can collectively and systematically substantiate the claim that entrepreneurship has important economic value.  Hence, a systematic review is provided that answers the question:

What is the contribution of entrepreneurs to the economy in comparison to non-entrepreneurs?  We study the relative contribution of entrepreneurs to the economy based on four measures that have most widely been studied empirically.  Hence, we answer the question: What is the contribution of entrepreneurs to (i) employment generation and dynamics, (ii) innovation, and (iii) productivity and growth, relative to the contributions of the entrepreneurs' counterparts, i.e., the 'control group'?  A fourth type of contribution studied is the role of entrepreneurship in increasing individuals' utility levels. 

Based on 57 recent studies of high quality that contain 87 relevant separate analyses, we conclude that entrepreneurs have a very important--but specific--function in the economy.  They engender relatively much employment creation, productivity growth and produce and commercialize high-quality innovations.  They are more satisfied than employees.  More importantly, recent studies show that entrepreneurial firms produce important spillovers that affect regional employment growth rates of all companies in the region in the long run.  However, the counterparts cannot be missed either as they account for a relatively high value of GDP, a less volatile and more secure labor market, higher paid jobs and a greater number of innovations and they have a more active role in the adoption of innovations. 

CfP's Special Issue on Role of Entrepreneurship and Technology Business Incubation for Sustainable Growth of SMEs in Changing Economic Scenarios in Developing Countries; International Journal of Business and Emerging Markets

Call for Papers for Special Issue on Role of Entrepreneurship and Technology Business Incubation for Sustainable Growth of SMEs in Changing Economic Scenarios in Developing Countries

International Journal of Business and Emerging Markets http://www.inderscience.com/ijbem

Editors: Dr. V. P. Wani, National Institute of Technology, India Dr. Satyendra Singh, University of Winnipeg, Canada

Entrepreneurship is the essence of economic development, but it cannot exist without technological innovation.  Science Parks, Innovation Centres and Technology Business Incubators are similar initiatives in creating an environment for innovation and entrepreneurship.  These initiatives foster interactions between academia and industry for sharing ideas and experiences and for developing new technology in order to transfer it to the end-users through SMEs.  Merely, creating such facilities, planning programmes and delivering training is not sufficient; equally important is the vision and strategy that educate entrepreneurs and empower them for change.

Given the role of academia in developing entrepreneurship for sustainable development of SMEs, the aim of this special issue is to provide a common platform to researchers, scholars and practitioners to address issues relating to the subjects mentioned in the next section.  Manuscripts based on entrepreneurial and innovation orientations are particularly suitable for this issue; so are the comparative studies conducted in developing countries.

Subject coverage

• Entrepreneurship Education and its Role in Regional Development
• Role of Academic Society in Hi-Tech Business Development
• Role of SMEs in Developing Countries
• Role of Entrepreneurship and SMEs in Innovation
• Research Methodology and Theory Relating to Development of SMEs

Submission deadline is June 30, 2008 Publication date is early 2009

All manuscripts are refereed through a peer review process.  A guide for authors, sample copies and other relevant information for submitting manuscripts are available on the Journal's website: http://www.inderscience.com/ijbem Please include in your submission the title of the Special Issue

Please send a copy (MS Word file) of your manuscript to the following:

Dr. V. P. Wani Department of Mechanical Engineering National Institute of Technology Kurukshetra 136119 INDIA E-mail: [email protected] or [email protected]

and

Dr. Satyendra Singh Department of Business and Administration University of Winnipeg 515 Portage Avenue Winnipeg R3B 2E9 CANADA E-mail: [email protected] http://www.uwinnipeg.ca/~ssingh5

If you are interested in serving as an ad hoc reviewer for the issue/journal, please contact [email protected]

NOTE: Manuscripts that have gone through the review process successfully but were not considered for publication in this special issue due to page constraints will be published in the regular issues of International Journal of Business and Emerging Markets.

More on the !ndigo Books Entrepreneur Series

From the !ndigo Books Entrepreneur Series:

Are you an aspiring entrepreneur?  Join us for an exclusive series as Heather Reisman, CEO of Indigo Books & Music, interviews Canada's most successful entrepreneurs.

All !ndigo Entrepreneur events will be held at Indigo Bay & Bloor, Toronto, and will start at 7:30 pm.

Http://www.chapters.indigo.ca/indigo-entrepreneur-series/entrepreneur_events-promonb.html

• Ted Rogers President & CEO, Rogers Communications Inc. September 18 Edward S. (Ted) Rogers' start in the communications industry began in 1960 with the purchase of Toronto FM radio station CHFI.  While FM was a new technology, Ted Rogers worked to popularize the superior service.  Mr. Rogers has been involved at the start-up stage with numerous ventures in broadcasting, cable television and telecommunications.
• Sandra Wilson Founder, Robeez September 20 Since 1994, Sandra Wilson has grown Robeez Footwear from a home basement operation into a multi-million dollar international company with regional offices and local websites in the UK and Australia and sales representatives in the UK, Ireland, Western Europe, Japan and Australia.  Robeez now offers over 60 different styles and is sold in over 4,000 stores worldwide.
• Robert Lantos Producer, Serendipity Point Films September 24 As the former Chairman and CEO of the country's largest film and television production company, Alliance Communications, Robert Lantos has greatly enhanced the visibility and viability of Canadian film and television productions both nationally and internationally.
• Seymour Schulich Chairman, Nevada Capital Corporation Ltd.  September 25 Seymour Schulich is a self-made billionaire whose career has spanned financial markets to the mining and oil industries.  He is among Canada's greatest philanthropists having donated in excess of $200 million to universities, libraries, medical health centres, and lecture and music halls.
• Jim Pattison Chairman & CEO, The Jim Pattison Group September 26 This Vancouverite has an exceptional record of community service and, most recently, has devoted a great deal of time and effort as President and Chairman of the EXPO '86 Corporation to ensure the smooth running and success of EXPO '86, which has been a major economic and cultural boost for British Columbia.
• Gerry Schwartz Chairman & CEO, Onex Corporation September 27 Blending vision with pragmatism, Gerald Schwartz stands out as one of Canada's best examples of contemporary entrepreneurship.  President and CEO of Onex Corporation, he has grown his company into a diversified, Canadian-based financial success story.  Engaged in the community, he is an active volunteer and quiet benefactor.
• Peter Munk Chairman, Barrick Gold Corporation October 9 A well-known Canadian business leader and philanthropist, Mr. Munk has built several enterprises that have achieved outstanding performances.  Starting in 1983, Mr. Munk and his management team have developed Barrick into one of the world's most successful gold producers.

© 2005-2007 

Walter Derzko -"Changing the world, one idea at a time"©

Walter Derzko teaches at the Certificate Program on Innovation and Entrepreneurship at the University of Toronto, School of Continuing Studies, which starts in the Fall of 2007

Expert, Consultant and Keynote Speaker on Emerging Smart Technologies, Innovation, Entrepreneurship, Strategic Foresight, Business Development, Lateral Creative Thinking and author of an upcoming book on the Smart Economy "

The Smart Technology Blog: The Smart Economy -- Read, enjoy, explore, speculate, comment !!

To arrange for an in house presentation or briefing on smart technology see here

To explore the opportunities and threats of any new smart technology in your industry - Contact Me or explore how we can work together

• ".....Strategy without action is a day-dream; action without strategy is a nightmare"-old Japanese proverb
• ".......Ours is the age that is proud of machines that think and suspicious of men who try to." -- H. Mumford Jones
• ".......Without changing our patterns of thought, we will not be able to solve the problems we created with our current pattern of thought."  --A. Einstein
• ".......Change is difficult, but complacency and stagnation are surefire showstoppers..." --Walter Derzko"
• .......Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has."  -- Margaret Mead
• ".......Small minds discuss people; Average minds discuss events; Great minds discuss ideas; --Anon

P. S. if this is your first visit to my blog, please go to our Welcome page

Indigo Entrepreneur Series; Come out to hear Ted Rogers, CEO Rogers Communications

Indigo Books is kicking  off its Entrepreneur Speaker Series tonight in Toronto with its first guest speaker, Ted Rogers, CEO Rogers Communications. Edward S. (Ted) Rogers' start in the communications industry began in 1960 with the purchase of Toronto FM radio station CHFI. While FM was a new technology, Ted Rogers worked to popularize the superior service. Mr. Rogers has been involved at the start-up stage with numerous ventures in broadcasting, cable television and telecommunications.

Tuesday Sept 18, 2007 at 7:30 pm Indigo Books, Manulife Center 55 Bloor St West, Toronto

...one of the best lines of the night was a question from Heather Reisman, to Ted Rogers...so I understand entrpepreneurs can sometimes be difficult to work for. Without missing a beat, Ted replied yes, I've been talking to some of your people."

For more info on the series see www.chapters.indigo.ca/entrepreneur

For a story  with Heather Reisman from Indigo Books talking about the Entrepreneur Series, see Gordon Pitt's interview in the Monday Globe & Mail

© 2005-2007 

Walter Derzko -"Changing the world, one idea at a time"©

Walter Derzko teaches at the Certificate Program on Entrepreneurship and Innovation at the University of Toronto, School of Continuing Studies, which starts in the Fall of 2007

Expert, Consultant and Keynote Speaker on Emerging Smart Technologies, Innovation, Entrepreneurship, Strategic Foresight, Business Development, Lateral Creative Thinking and author of an upcoming book on the Smart Economy "

The Smart Technology Blog: The Smart Economy -- Read, enjoy, explore, speculate, comment !!

To arrange for an in house presentation or briefing on smart technology see here

To explore the opportunities and threats of any new smart technology in your industry - Contact Me or explore how we can work together

• ".....Strategy without action is a day-dream; action without strategy is a nightmare"-old Japanese proverb
• ".......Ours is the age that is proud of machines that think and suspicious of men who try to." -- H. Mumford Jones
• ".......Without changing our patterns of thought, we will not be able to solve the problems we created with our current pattern of thought."  --A. Einstein
• ".......Change is difficult, but complacency and stagnation are surefire showstoppers..." --Walter Derzko"
• .......Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has."  -- Margaret Mead
• ".......Small minds discuss people; Average minds discuss events; Great minds discuss ideas; --Anon

P. S. if this is your first visit to my blog, please go to our Welcome page

The Entrepreneurial Society-Book Review

Summer Reading Suggestions for the Savvy Entrepreneur

The Entrepreneurial Society

By David Audretsch (Oxford University Press, 2007)

David Audretsch is well-known in academic circles for numerous articles and papers on the entrepreneurial economy.  In The Entrepreneurial Society, he presents a compelling statement of how entrepreneurship has helped drive America to global financial leadership.  He contends that the entrepreneurial economy represents a strategic response to the growing importance of knowledge as the key factor in economic success.  In the past, capital and labor were the key ingredients for prosperity.  Today, knowledge capital and entrepreneurship capital have assumed a more pre-eminent role.

Source: Certificate program in Entrepreneurship & Innovation; University of Toronto, School of Continuing Studies, St George Campus.

© 2005-2007 

Walter Derzko -"Changing the world, one idea at a time"©

Walter Derzko teaches at the Certificate Program on Entrepreneurship and Innovation at the University of Toronto, School of Continuing Studies, which startes in the Fall of 2007

Expert, Consultant and Keynote Speaker on Emerging Smart Technologies, Innovation, Entrepreneurship, Strategic Foresight, Business Development, Lateral Creative Thinking and author of an upcoming book on the Smart Economy "

The Smart Technology Blog: The Smart Economy -- Read, enjoy, explore, speculate, comment !!

To arrange for an in house presentation or briefing on smart technology see here

To explore the opportunities and threats of any new smart technology in your industry - Contact Me or explore how we can work together

• ".....Strategy without action is a day-dream; action without strategy is a nightmare"-old Japanese proverb
• ".......Ours is the age that is proud of machines that think and suspicious of men who try to." -- H. Mumford Jones
• ".......Without changing our patterns of thought, we will not be able to solve the problems we created with our current pattern of thought."  --A. Einstein
• ".......Change is difficult, but complacency and stagnation are surefire showstoppers..." --Walter Derzko

• ".......Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has."  -- Margaret Mead

• ".......Small minds discuss people; Average minds discuss events; Great minds discuss ideas; --Anon

P. S. if this is your first visit to my blog, please go to our Welcome page

The Start-up Economy; Entrepreneurship Can Triumph Over Globalization

Embracing innovation is the only way for Western businesses to succeed in the global market, says Indiana University economics Professor David Audretsch, whose new book, The Entrepreneurial Society, is due for release in July (Oxford University Press).  He argues that labor will continue to be outsourced abroad as long as the tasks involved are routine and replicable, but companies that reward new ideas, niche markets and community collaboration can thrive on local employment.

The book outlines the progression in the U.S. and Europe from the managed economy of the Cold War era through globalization, arriving at the current state Audretsch terms "the entrepreneurial society."  This economic climate, he says, supports businesses that are highly adaptable and targeted to specific consumer needs.  Drawing on his research linking the number of startups in a community to its economic health, Audretsch concludes that industries must adopt an entrepreneurial mindset in order to remain viable.

"If your company's competitive advantage is based on lowest cost, you're out of here," he said.  "If you want to stay and thrive in the U.S., the focus needs to be on innovation.  You need to think of things we're not doing today."

Baby boomers have had a difficult time grasping the changes of a globalized economy, he said.  They inherited the economic success of the postwar era, in which large corporations were the major employers.  Their attempts to follow an outdated formula have led to personal and corporate financial failures, Audretsch said.

He hopes The Entrepreneurial Society will "help them rise to the opportunities of globalization rather than be victimized by it," he said.  Although Audretsch has written and edited more than 30 books on economic development, this is his first for a general audience.

"I wrote this book to tell my generation what happened to the world we knew and loved -- and to tell our children why we're so strange," he said.

Moving beyond the conclusions of Thomas Friedman's 2005 bestseller The World is Flat, Audretsch argues that business innovation actually occurs in geographical "pockets" such as Silicon Valley software development, fashion in Paris and Milan, and finance in New York.  Talent -- and wealth -- tend to collect in these areas known for cutting-edge development.  The solution to the off-shoring dilemma, Audretsch says, lies in identifying community strengths and building these areas as hotbeds of innovation.

"It turns out, ideas and creation of those ideas happen in a proximate way -- people gathered together make ideas grow, and to proactively respond you need to be in the same place together.  Business innovation functions much like the world of music -- the best work happens when you get together and jam," he said.

The generation that is now entering the work force understands these concepts instinctively, Audretsch said.

"Young professionals now talk about starting firms the way their parents used to talk about landing a corporate position -- it's how they expect their careers to develop.  They seem to 'get' the idea that by appealing to niche markets they can fulfill a unique need, whereas their parents, for the most part, are still doing the same old, same old," he said.

Mature managers need to take a lesson from their 20-something children and rethink the way they do business, especially with respect to gathering ideas from all levels of their organizations, he said.

"Corporate culture needs to reorient so that if you try a new venture and fail, you're not going to be penalized.  Trial and failure in the entrepreneurial society are just part of the process.  We need to create structures and incentives that encourage managers to get out of the way of new ideas.  Create a path that rewards innovation and input from all levels, and you won't be able to export that."

Audretsch is director of the Entrepreneurship, Growth and Public Policy Division at the Max Planck Institute of Economics in Germany and Ameritech Chair of Economic Development and director of the Institute for Development Strategies at Indiana University.  He teaches in the School of Public and Environmental Affairs.

Advance praise for the book: http://newsinfo.iu.edu/news/page/normal/5713.html.

More information is available from the publisher: http://www.oup.com/us/catalog/general/subject/Business/Entrepreneurship/?view=usa&ci=9780195183504.