Thresholds, niches and inertia: Entrepreneurial opportunities in the steamship industry

Abstract

This paper seeks to increase understanding of the role the environment in the emergence of business opportunities, and how opportunities change as industries evolves. It explores the dynamics of entrepreneurial opportunity in the British steamship industry. It suggests niches are created when environmental thresholds are reached. Entrepreneurs who act before thresholds are reached fail. A complex relationship between inventors, innovators/entrepreneurs and higher order opportunities is revealed illustrating the difficulty of identifying 'higher order opportunities. Over time, variations in environmental forces changed niche size and carrying capacity. Causes of new niche formation were both exogenous and endogenous supporting both Kirzner and Schumpeter. Inertial forces inhibited the ability of existing players to seize opening niches and expanded opportunities for new comers.