The promotion of entrepreneurship in low density regions: the case of the Agency for the Regional Development of Alentejo (ADRAL).

Abstract

In the 1980s, the renewal of academic interest in entrepreneurship as a factor of development highlighted the role of entrepreneurs in creating jobs and driving creativity and innovation. In the new century, fostering entrepreneurship became a public policy priority of in many countries, with decision makers recognizing the value of entrepreneurial endowments in a world where comparative advantages shifted, from the traditional factors of production, towards knowledge. The practice, common in the United States, of creating business incubators supplying space and supportive environments for entrepreneurs spread to Europe. In Portugal, this strategy has been gradually gaining momentum and various national and local institutions have developed business incubation activities. In this study, we focus on ADRAL - Agência de Desenvolvimento Regional do Alentejo, a local agency for the regional development of the Portuguese region of Alentejo, and analyze one of its instruments for the promotion of entrepreneurship – the creation of business incubators (also designated as enterprises’ nests) located in Marvão and Montemor-o-Novo. We focus on these two cases and investigate the distinctiveness of the partnership between the development agency and the municipalities, and also the characteristics of the projects and of the entrepreneurs, aiming at identifying the distinctive elements of this approach and its success determinants.