Demand-side Drivers of Entrepreneurial Activity: a Cliometric Reassessment Using Socially Embedded Historical Artifacts
Abstract: Which comes first: the demand for entrepreneurial innovations or the supply? Although existing theories posit an interactive, highly interdependent model of demand-pull and supply-push forces; functionally, scholarship has focused overwhelmingly on the supply of entrepreneurial innovations, not the demand. The result of this supply-side skew is that the influence of demand-side opportunity signaling has been relegated to a subordinate, virtually non-existent role. In one of the first expansive empirical analyses highlighting societal demand for entrepreneurship, I use historical artifacts and cliometric models to analyze data spanning 97 years -- from the launch of Popular Science Monthly magazine (1872) to the first moon landing (1969) – in order to assess the ways in which society signals demand-side preferences for a greater quantity and diversity of entrepreneurial activity. By employing panoramic data and an historical approach, my study provides evidence that opportunity spaces often exist prior to being occupied; societal preferences play a key role in determining the quantity and diversity of entrepreneurial activity; and, entrepreneurs who are responsive to demand-side opportunity signaling are likely to face significantly greater prospects of long-term survival. The findings offer transformative insights for scholars and practitioners by revealing the critical role of demand-side opportunity signaling and reestablishing mutuality between supply-push and demand-pull forces in generating and selecting new innovations.
