Kauffman Foundation Series on Innovation and Entrepreneurship

"Winner of the 2011 Silver Medal Book Award in Entrepreneurship, Axiom Business" David S. Landes is the Coolidge Professor of History and professor emeritus of economics at Harvard University. Joel Mokyr is the Robert Strotz Professor of Arts and Sciences and professor of economics and history at Northwestern University. William J. Baumol is the Harold Price Professor of Entrepreneurship at New York University's Stern School of Business. A sweeping global history of entrepreneurial innovation Whether hailed as heroes or cast as threats to social order, entrepreneurs-and their innovations-have had an enormous influence on the growth and prosperity of nations. The Invention of Enterprise gathers together, for the first time, leading economic historians to explore the entrepreneur's role in society from antiquity to the present. Addressing social and institutional influences from a historical context, each chapter examines entrepreneurship during a particular period and in an important geographic location. The book chronicles the sweeping history of enterprise in Mesopotamia and Neo-Babylon; carries the reader through the Islamic Middle East; offers insights into the entrepreneurial history of China, Japan, and Colonial India; and describes the crucial role of the entrepreneur in innovative activity in Europe and the United States, from the medieval period to today. In considering the critical contributions of entrepreneurship, the authors discuss why entrepreneurial activities are not always productive and may even sabotage prosperity. They examine the institutions and restrictions that have enabled or impeded innovation, and the incentives for the adoption and dissemination of inventions. They also describe the wide variations in global entrepreneurial activity during different historical periods and the similarities in development, as well as entrepreneurship's role in economic growth. The book is filled with past examples and events that provide lessons for promoting and successfully pursuing contemporary entrepreneurship as a means of contributing to the welfare of society. The Invention of Enterprise lays out a definitive picture for all who seek an understanding of innovation's central place in our world. "The Invention of Enterprise offers a timely contribution to our emerging understanding of entrepreneurship in an historical context and is particularly worthwhile for readers who are interested in certain rich historical episodes that are nevertheless little known."---Michaël Bikard and Scott Stern, Journal of Economic Literature "I think these essays deserve close consideration, as much for the questions they raise as for the answers they give about innovation and entrepreneurship."---Mansel G. Blackford, EH.Net "Entrepreneurship has a long and varied history, and academics explore its evolution in The Invention of Enterprise. Edited by [Landes, Baumol, and Mokyr], the book collects essays from the editors and 18 other economists and historians. They look for commonalities in the societies that prospered--or failed to prosper--from entrepreneurial innovation, and they note that entrepreneurship is directly affected by the prevailing culture and religion." "The Invention of Enterprise is a bold, exploratory attempt to answer our most important questions about how entrepreneurship has evolved and what makes it flourish. The volume brings together a stellar cast of economic historians. The important questions and the available evidence for the periods and places analyzed vary tremendously, so authors' approaches must too. Their scope is almost beautifully and absurdly vast, their insights are numerous, and their conclusions are restrained."---Robert Whaples, Books & Culture "A classic, impressive, study for serious students of the subject." "The Invention of Enterprise is an important contribution. It will certainly affect key debates in economics and economic history along with the national and regional hist

"Winner of the 2009 Silver Medal Book Award in International Business/Globalization, Jenkins Group, Inc., Axiom Business" "Winner of the 2008 PROSE Award in Business, Finance, and Management, Association of American Publishers" "One of Economist's Best Books for 2008" "One of BusinessWeek's Best Innovation and Design Books for 2008" Amar Bhidé is the Thomas Schmidheiny Professor at the Fletcher School of Law and Diplomacy, Tufts University, editor of Capitalism and Society, member of the Council on Foreign Relations, and the author of The Origin and Evolution of New Businesses. A former McKinsey & Company consultant, Bhidé was educated at the Indian Institute of Technology and Harvard Business School, where he graduated as a Baker Scholar and later served as an associate professor. Many warn that the next stage of globalization--the offshoring of research and development to China and India--threatens the foundations of Western prosperity. But in The Venturesome Economy, acclaimed business and economics scholar Amar Bhidé shows how wrong the doomsayers are. Using extensive field studies on venture-capital-backed businesses to examine how technology really advances in modern economies, Bhidé explains why know-how developed abroad enhances--not diminishes--prosperity at home, and why trying to maintain the U.S. lead by subsidizing more research or training more scientists will do more harm than good. When breakthrough ideas have no borders, a nation's capacity to exploit cutting-edge research regardless of where it originates is crucial: "venturesome consumption"--the willingness and ability of businesses and consumers to effectively use products and technologies derived from scientific research--is far more important than having a share of such research. In fact, a venturesome economy benefits from an increase in research produced abroad: the success of Apple's iPod, for instance, owes much to technologies developed in Asia and Europe. Many players--entrepreneurs, managers, financiers, salespersons, consumers, and not just a few brilliant scientists and engineers--have kept the United States at the forefront of the innovation game. As long as their venturesome spirit remains alive and well, advances abroad need not be feared. Read The Venturesome Economy and learn why--and see how we can keep it that way. "Bhidé makes a detailed argument that contradicts the prevailing view of expert panels and authors who contend that the nation's prosperity is threatened by the technological rise of China and India, and that America's capacity for innovation is eroding. . . . Mr. Bhidé derides the conventional view in science and technology circles as 'techno-nationalism,' needlessly alarmist and based on a widely held misunderstanding of how technological innovation yields economic growth. In his view, many analysts put too much emphasis on the production of new technological ideas. Instead, he observes, the real economic payoff lies in innovations in how technologies are used."---Steve Lohr, New York Times "Offers a perspective on American innovation and prosperity that is remarkably optimistic, given the temper of the times. Among his data-driven findings: American consumers have long shown an 'exceptional willingness' to buy, for instance, technology products before their utility is clear. Such 'venturesome consumers' help spur companies and entrepreneurs to take the risks that lead to innovation."---Rob Walker, New York Times "The Venturesome Economy is a refreshing riposte to the doomsayers of recession and the bleak prognostications of the technonationalists. It is a compelling book and will have a wide audience; many will be interested in the numerous case studies, particularly of IT and biotech firms. The emphasis on relationships, connections and networks resonates well with modern literature on social capital and economic psychology."---Michelle Baddeley, Times Higher Education "Bhidé points out that w

"Winner of the 2014 Entrepreneurship Practice Award, Entrepreneurship Division of the Academy of Management" "Winner of the 2013 Silver Medal Book Award in Entrepreneurship, Axiom Business" "Finalist for the 2013 George R. Terry Book Award, Academy of Management" Noam Wasserman is an associate professor at Harvard Business School. A guide to the early decisions that can make or break startup ventures Often downplayed in the excitement of starting up a new business venture is one of the most important decisions entrepreneurs will face: should they go it alone, or bring in cofounders, hires, and investors to help build the business? More than just financial rewards are at stake. Friendships and relationships can suffer. Bad decisions at the inception of a promising venture lay the foundations for its eventual ruin. The Founder's Dilemmas is the first book to examine the early decisions by entrepreneurs that can make or break a startup and its team. Drawing on a decade of research, Noam Wasserman reveals the common pitfalls founders face and how to avoid them. He looks at whether it is a good idea to cofound with friends or relatives, how and when to split the equity within the founding team, and how to recognize when a successful founder-CEO should exit or be fired. Wasserman explains how to anticipate, avoid, or recover from disastrous mistakes that can splinter a founding team, strip founders of control, and leave founders without a financial payoff for their hard work and innovative ideas. He highlights the need at each step to strike a careful balance between controlling the startup and attracting the best resources to grow it, and demonstrates why the easy short-term choice is often the most perilous in the long term. The Founder's Dilemmas draws on the inside stories of founders like Evan Williams of Twitter and Tim Westergren of Pandora, while mining quantitative data on almost ten thousand founders. People problems are the leading cause of failure in startups. This book offers solutions. "[A] first-aid manual to help resuscitate ailing start-ups."---Jessica Bruder, New York Times "Noam Wasserman is one of the writers and teachers who best captures the high stakes decisions that entrepreneurs face every day."---Scott Kirsner, Boston Globe "The single-most indispensible guide for founders of startups. Comingling research, straight talk, and a human voice-so often lacking in books with an academic bent-Dilemmas totally rocks as a business school required read and a founder's gripping, absolute must-read. Turning the last page, anyone with an entrepreneurial femur in their body will be fully armed with a battery of knowledge that can make or break a passionate first or even fifteenth venture. Do not start a startup without this book."---Ted Sturtz, New York Journal of Books "[A] seminal work. . . . Sure to be required reading in business school curricula, this illuminating and captivating read will also appeal to aspiring entrepreneurs or founders who want to make better decisions in existing ventures." "Wasserman's book is on track to take as lofty a position in the entrepreneurial literature as Clayton Christensen's The Innovator's Dilemma did in the field of technological change."---Peter Cohan, Forbes "[A] uniquely valuable resource for any entrepreneur."---Terrence Murray, Financialist "The guru on this subject is Noam Wasserman . . . [an] insightful book."---Luke Johnson, BusinessDay "The definitive book on the topic. . . . If you are a founder or thinking about becoming one, you should read this book."---Dharmesh Shah, OnStartups.com "[A] must-read for anyone thinking of creating a startup, who is currently involved with one or who is an investor/advisor in the startup ecosystem."---Dilip James, Business Standard "Highly recommended for those who plan to embark or are already living the entrepreneurial lifestyle, it can serve as a guide to very tough situations for founders to evaluate the best possible w

William J. Baumol is professor of economics and academic director of the Berkley Center for Entrepreneurial Studies at New York University. His many books include The Free-Market Innovation Machine: Analyzing the Growth Miracle of Capitalism and The Invention of Enterprise: Entrepreneurship from Ancient Mesopotamia to Modern Times (both Princeton). An authoritative look at the microeconomics of entrepreneurship Entrepreneurs are widely recognized for the vital contributions they make to economic growth and general welfare, yet until fairly recently entrepreneurship was not considered worthy of serious economic study. Today, progress has been made to integrate entrepreneurship into macroeconomics, but until now the entrepreneur has been almost completely excluded from microeconomics and standard theoretical models of the firm. The Microtheory of Innovative Entrepreneurship provides the framework for introducing entrepreneurship into mainstream microtheory and incorporating the activities of entrepreneurs, inventors, and managers into standard models of the firm. William Baumol distinguishes between the innovative entrepreneur, who comes up with new ideas and puts them into practice, and the replicative entrepreneur, which can be anyone who launches a new business venture, regardless of whether similar ventures already exist. Baumol puts forward a quasi-formal theoretical analysis of the innovative entrepreneur's influential role in economic life. In doing so, he opens the way to bringing innovative entrepreneurship into the accepted body of mainstream microeconomics, and offers valuable insights that can be used to design more effective policies. The Microtheory of Innovative Entrepreneurship lays the foundation for a new kind of microtheory that reflects the innovative entrepreneur's importance to economic growth and prosperity. "Even as innovative entrepreneurship has emerged as the goal for policymakers around the globe, economists have struggled to find its proper place in microtheory. No more. In this pathbreaking new book, William Baumol provides the blueprint for understanding the crucial role of entrepreneurship and its contribution to innovation and ultimately economic growth. This lively and thoughtful book highlights the distinct role entrepreneurs play in the economy and reveals why the entrepreneur can no longer remain the invisible man in economic theory."-David B. Audretsch, author of The Entrepreneurial Society "Baumol is one of the giants in the entrepreneurship field. The Microtheory of Innovative Entrepreneurship will be widely read, discussed, and debated, and is likely to have a significant impact on the scholarly conversation."-Peter G. Klein, University of Missouri "This book is a timely and valuable contribution to the economics of entrepreneurship. Baumol's ambitious goal is to give the entrepreneur his rightful place in economic theory. He demonstrates that, contrary to conventional thinking, the elusive figure of the entrepreneur is indeed amenable to logical economic analysis."-Simon C. Parker, University of Western Ontario

"Co-Winner of the 2016 Schumpeter Prize Competition, International Joseph A. Schumpeter Society" Shane Greenstein is the Martin Marshall Professor of Business Administration and codirector of the program on the economics of digitization at the National Bureau of Economic Research. His books include Diamonds Are Forever, Computers Are Not and Standards and Public Policy. In less than a decade, the Internet went from being a series of loosely connected networks used by universities and the military to the powerful commercial engine it is today. This book describes how many of the key innovations that made this possible came from entrepreneurs and iconoclasts who were outside the mainstream-and how the commercialization of the Internet was by no means a foregone conclusion at its outset. Shane Greenstein traces the evolution of the Internet from government ownership to privatization to the commercial Internet we know today. This is a story of innovation from the edges. Greenstein shows how mainstream service providers that had traditionally been leaders in the old-market economy became threatened by innovations from industry outsiders who saw economic opportunities where others didn't-and how these mainstream firms had no choice but to innovate themselves. New models were tried: some succeeded, some failed. Commercial markets turned innovations into valuable products and services as the Internet evolved in those markets. New business processes had to be created from scratch as a network originally intended for research and military defense had to deal with network interconnectivity, the needs of commercial users, and a host of challenges with implementing innovative new services. How the Internet Became Commercial demonstrates how, without any central authority, a unique and vibrant interplay between government and private industry transformed the Internet. "Essential reading for anyone who wants to understand the broader context in which the explosion of Internet-related innovation occurred."---Marc Levinson, Wall Street Journal "A welcome, well-conceived contribution to the history of technology." "Exciting reading." "Definitely recommended."---Tyler Cowen, Marginal Revolution "This is the best book yet about the rise of the Internet."---David Warsh, Economic Principals "[A] detailed history of the Internet." "Immensely informative." "Greenstein is not simply telling a colorful and important story. His analysis systematically explores why innovation and commercialization of the Internet emerged and evolved as it did and why innovation from the edges thrived and was so important."---Jonathan David Aronson, Journal of Communication "A must for students and purveyors on the Internet. . . . [I]f you are interested in the dotcom boom; or how the Internet evolved to create new business models and inspired scores of new age entrepreneurs, this book will not disappoint you." "In this important book, Greenstein draws on economics, business history, and the history of technology to tell a story of disruption on a grand scale. He shows how outsiders to the information and communications technology establishment brought the Internet from its techie origins to its current role as an economic growth engine."-Timothy Bresnahan, Stanford University "With this engaging account of the Internet's origins and innovative explosion, Shane Greenstein cements his claim as the foremost economic historian of digital technology. An essential read for all who want to understand the miracle of our lifetime."-Joshua Gans, University of Toronto "Greenstein offers a powerful and lucid account of the way the Internet's exceptional growth arose from unexceptional economic forces.How the Internet Became Commercialis a foundational read for anyone wanting to understand the origins and dynamics of the mainstream Internet."-Jonathan Zittrain, Harvard Law School "The Internet and its applications are transforming business and commerce. There is no e

Robert D. Cooter is the Herman F. Selvin Professor of Law at the University of California, Berkeley. His books include The Strategic Constitution (Princeton). Hans-Bernd Schäfer is professor of law and economics at the Bucerius Law School in Hamburg, Germany, and professor emeritus at the University of Hamburg. His books include The Economic Analysis of Civil Law. Why law is critical to innovation and economic growth Sustained growth depends on innovation, whether it's cutting-edge software from Silicon Valley, an improved assembly line in Sichuan, or a new export market for Swaziland's leather. Developing a new idea requires money, which poses a problem of trust. The innovator must trust the investor with his idea and the investor must trust the innovator with her money. Robert Cooter and Hans-Bernd Schäfer call this the "double trust dilemma of development." Nowhere is this problem more acute than in poorer nations, where the failure to solve it results in stagnant economies. In Solomon's Knot, Cooter and Schäfer propose a legal theory of economic growth that details how effective property, contract, and business laws help to unite capital and ideas. They also demonstrate why ineffective private and business laws are the root cause of the poverty of nations in today's world. Without the legal institutions that allow innovation and entrepreneurship to thrive, other attempts to spur economic growth are destined to fail. "Cooter and Schafer apply insights from the field of law and economics to the problem of poverty. They describe how institutions like contracts overcome dilemmas of trust at the heart of economic transactions. Readers interested in understanding the law and economics approach would do well to start with this well-written volume, which develops a model of the legal institutions needed for innovation. . . . [A] significant contribution to the field." "[C]ompelling."---Michael Strong, Barron's "Rich in institutional detail, wisdom and practical advice."---Alex Tabarrok, Marginal Revolution "The authors, Cooter and Schafer, skilfully avoid economics verbiage and complicated legal terms, providing instead a plethora of anecdotes, appropriate examples and studies."---Lisa Kaaki, Arab News "Solomon's Knot remains an entertaining and comprehensive read. It successfully conveys the main theories of law and economics within the context of promoting innovation as a source of sustained growth. Moreover, it proposes clear and simple policy recommendations for developing countries to adopt in pursuit of greater wealth creation and economic development."---Christel Y. Tham, Journal of International Law and Politics "Robert Cooter and Hans-Bernd Schäfer have written a seminal book with great sympathy for the problems posed by "Solomon's Knot,"as well as for the protagonists involved. They explain how good law is essential to economic development, as, conversely, bad law results in poverty. Solomon's Knot gives us a fresh new look at the most fundamental economic problem: why some nations are poor, while others are rich."-George Akerlof, Nobel Laureate in Economics 2012 "Solomon's Knot unites law and economics in cogently explaining how effective legal institutions support innovation-the engine of economic growth in every society."-Curtis Milhaupt, Columbia University "Cooter and Schäfer continuously challenge the reader with thought provoking insights based on solid theory and empirical studies. This book is a major addition to our knowledge on the relationship between the overall quality of the legal order and economic growth."-Roger Van den Bergh, Erasmus University Rotterdam "Growth spurts that catapult a country or region to economic preeminence are fascinating but poorly understood. Cooter and Schäfer show that such spurts tend to track legal changes that facilitate the protection of property, the enforcement of contracts, and, most important, the launching of innovative business ventures. Consistentl

"Winner of the 2009 PROSE Award in Business, Finance & Management, Association of American Publishers" "Co-Winner of the 2010 Gold Medal Book Award in Entrepreneurship, Axiom Business" Josh Lerner is the Jacob H. Schiff Professor of Investment Banking at Harvard Business School, with a joint appointment in finance and entrepreneurial management. He is the coauthor of Innovation and Its Discontents (Princeton), The Venture Capital Cycle, and other books. How governments can do a better job of supporting entrepreneurship and venture capital Silicon Valley, Singapore, Tel Aviv-the global hubs of entrepreneurial activity-all bear the marks of government investment. Yet, for every public intervention that spurs entrepreneurial activity, there are many failed efforts that waste untold billions in taxpayer dollars. When has governmental sponsorship succeeded in boosting growth, and when has it fallen terribly short? Should the government be involved in such undertakings at all? Boulevard of Broken Dreams is the first extensive look at the ways governments have supported entrepreneurs and venture capitalists across decades and continents. Josh Lerner, one of the foremost experts in the field, provides valuable insights into why some public initiatives work while others are hobbled by pitfalls, and he offers suggestions for how public ventures should be implemented in the future. Discussing the complex history of Silicon Valley and other pioneering centers of venture capital, Lerner uncovers the extent of government influence in prompting growth. He examines the public strategies used to advance new ventures, points to the challenges of these endeavors, and reveals the common flaws undermining far too many programs-poor design, a lack of understanding for the entrepreneurial process, and implementation problems. Lerner explains why governments cannot dictate how venture markets evolve, and why they must balance their positions as catalysts with an awareness of their limited ability to stimulate the entrepreneurial sector. As governments worldwide seek to spur economic growth in ever more aggressive ways, Boulevard of Broken Dreams offers an important caution. The book argues for a careful approach to government support of entrepreneurial activities, so that the mistakes of earlier efforts are not repeated. "[S]uperb."---Edward L. Glaeser, New York Times' "Lots of governments would like to promote high-tech entrepreneurship and venture capital in their regions--but many don't know how to do it effectively. In his new book Boulevard of Broken Dreams, Josh Lerner . . . examines which types of policies to promote entrepreneurship and venture capital tend to work--and which don't. Lerner supports his carefully researched analysis with numerous examples chosen from around the globe." "Can governments spark start-up activity and job creation by getting into the venture capital business? Or do they just waste taxpayer money whenever they try? Those are the two questions that animate the new book from Harvard Business prof Josh Lerner, Boulevard of Broken Dreams. . . . [W]hile the stories of failures are entertaining, what's most useful about Boulevard are the examples of governments that have gotten it right. . . . [A] really readable collection of data, anecdotes, and thoughtful arguments."---Scott Kirsner, Boston Globe "Today, calls for more innovation and entrepreneurship are more fashionable than ever, especially within government, where politicians and bureaucrats wastefully attempt to manufacture, via policy and subsidies, fresh batches of master agents and adventurers. But can government policy trigger entrepreneurship and subsequent growth? The title of a new book suggests not, Boulevard of Broken Dreams, by Harvard professor Josh Lerner. Much of Broken Dreams is a first-rate handbook for policy makers keen to avoid interventions that have proven track records as disasters. Lerner produces example after example of bad pr

Steven Klepper (1949–2013) was the Arthur Arton Hamerschlag Professor of Economics and Social Science at Carnegie Mellon University. Klepper was a founding member of the Doctoral Colloquium of the Consortium for Competitiveness and Collaboration, and served as director of CMU's program in Strategy, Entrepreneurship, and Technological Change. Serguey Braguinsky is associate professor of economics, David A. Hounshell is the David M. Roderick Professor of Technology and Social Change, and John H. Miller is professor of economics and social science, all at Carnegie Mellon University. How American industries rose to dominate the economic landscape in the twentieth century For much of the twentieth century, American corporations led the world in terms of technological progress. Why did certain industries have such great success? Experimental Capitalism examines six key industries-automobiles, pneumatic tires, television receivers, semiconductors, lasers, and penicillin-and tracks the highs and lows of American high-tech capitalism and the resulting innovation landscape. Employing "nanoeconomics"-a deep dive into the formation and functioning of companies-Steven Klepper determines how specific companies emerged to become the undisputed leaders that altered the course of their industry's evolution. Klepper delves into why a small number of firms came to dominate their industries for many years after an initial period of tumult, including General Motors, Firestone, and Intel. Even though capitalism is built on the idea of competition among many, he shows how the innovation process naturally led to such dominance. Klepper explores how this domination influenced the search for further innovations. He also considers why industries cluster in specific geographical areas, such as semiconductors in northern California, cars in Detroit, and tires in Akron. He finds that early leading firms serve as involuntary training grounds for the next generation of entrepreneurs who spin off new firms into the surrounding region. Klepper concludes his study with a discussion of the impact of government and the potential for policy to enhance a nation's high-tech industrial base. A culmination of a lifetime of research and thought, Experimental Capitalism takes a dynamic look at how new ideas and innovations led to America's economic primacy. "A masterful tapestry that weaves multiple levels of analysis, analytical techniques, and decades of scholarly work to create rich insights about the role of individual enterprise and innovation for the evolution of firms, industries, and regions."-Rajshree Agarwal, University of Maryland "This is an impressive book about the dynamics of firms and industries. Klepper masterfully sheds light on the evolutionary forces that drive entrepreneurship, industrial clustering, and firm dominance in high-tech industries."-Franco Malerba, Bocconi University "Steven Klepper takes readers on a fascinating journey through the life cycle of industries, from birth to maturity. His book is filled with lessons for everyone, including scholars, managers, entrepreneurs, and policymakers. Experimental Capitalism presents a nano approach from a giant in the field."-Alfonso Gambardella, author of Science and Innovation "Experimental Capitalism synthesizes and makes accessible the pathbreaking arguments that Steven Klepper crafted over the course of his career-provocative, illuminating arguments about the nature and sources of the evolution of industries, technological progress, and the development of industry clusters. His book builds on the most detailed data collection imaginable and spells out key policy implications that policymakers in the United States and around the globe should pay close attention to."-Wesley M. Cohen, Duke University "Experimental Capitalism is an important work by an important scholar. Shedding light on the question of where great industries come from, the book provides a unique p