**1. Introduction**

The recessionary phase that started in 2008 and is still ongoing in most European countries has significantly affected firms, sectors, and regions' ability to grow. Therefore, policymakers are increasingly interested in finding solutions to overcome the crisis and to ensure long-term competitiveness and growth.

In this context, the term resilience has emerged in the social sciences to investigate how an entity or a system responds to a destabilizing shock. Resilience has been defined by several disciplines, and it has been applied to a wide variety of contexts, from regions and provinces to firms and individuals.

In the recent economic literature, the engineering and ecological approaches have developed an equilibrium-based concept of resilience, in which resilience is regarded as a response to an exogenous shock and a move to a steady state. These definitions,

however, fail to conceptualize resilience as much broader than just assessing the sensitivity of an economy to disturbances [1].

Thus, this work focuses on the adaptive resilience definition. According to Martin [2], it concerns "the ability of a system to undergo an anticipatory or reactionary reorganization of form and or function to minimize the impact of a destabilizing shock" (p. 6). In this evolutionary framework, resilience becomes an ongoing process rather than a mechanism of recovery to a (preexisting or new) stable state [3]. In an economic system that is restless, adaptive resilience involves the ability of the system to recover from an exogenous disturbance as well as the ability of its industrial and technological structure to evolve by creating an innovative growth path. This is arguably because the necessity for economic renewal is felt more pressing during recessionary phases [4].

Unsurprisingly, given the Schumpeterian root of the evolutionary economics literature, Simmie and Martin [3] suggest that resilience is co-determined by endogenous sources of new knowledge and deliberate entrepreneurial decisions. This idea has important antecedents: Back in 1939, Schumpeter, the father of evolutionary economics, in his book "Business Cycles" [5], argued that innovations drive economic recovery following cyclical phases of recession and depression.

In Schumpeter's early works—labeled by the literature as Schumpeter Mark I conceptualization—innovation is characterized by a process of *"creative destruction"* with technological ease of entry and a major role played by entrepreneurs. The author, indeed, attributes to the entrepreneur the role of *"agent of change"* and *"persona causa"* of innovation. The entrepreneur, by creating a new firm, introduces radical innovations that disrupt the existent equilibrium or "circular flow."

According to recent evolutionary literature, instead, innovation relies on the organizations' ability to break away from their routines built over time. Nelson and Winter [6] define routines as the set of skills owned by an organization and claim that they represent the unit through which analyze the whole economic evolution. In this context, innovative performances become "a key element in the competitive struggle" among companies ([6], p. 34). Following this line of inquiry, differently from Schumpeter Mark I, innovation involves a wide variety of different agents and can be either radical or incremental. Innovation is a complex knowledge-driven process based on the development and commercial exploitation of new ideas for a product or process that contributes to wealth creation and profitability [7]. In light of the aforementioned scenario, new knowledge is endogenously generated, shared, and recombined through continuous dynamics of interactive learning among co-localized agents. As a consequence, innovation is a cumulative and collective process with evolutionary trajectories [6] and geographically grounded roots.

Due to the prominent position that entrepreneurship occupies in the Schumpeterian theory of innovation, we also need to analyze the literature on entrepreneurship to shed light on the complex relationship between the different conceptualizations of resilience and innovation.

By revising the recent economic literature on entrepreneurship, it emerges that there is no agreement in defining the unit of analysis through which to investigate entrepreneurship. Some researchers following Schumpeter Mark II argue that it does not coincide with the homo economicus who creates a new firm but with entrepreneurially oriented coordinated organizations. Conversely, according to Schumpeter Mark I, the focus is on the entrepreneur who can create a new company. In the knowledge spillover theory of entrepreneurship, instead, the focal point became the local system in which the entrepreneur/worker is embedded. This ambiguity, however, needs to be resolved.

#### *Resilience and Innovation: A Conceptual Approach DOI: http://dx.doi.org/10.5772/intechopen.113842*

By developing a conceptual framework in which we highlight the link between the different conceptualizations of resilience, innovation, and entrepreneurship, we argue that innovation is among the key drivers of resilience. In this context, differently from the previous literature, we claim that entrepreneurs play a key role in fostering the regional economy's ability to face recessionary shocks only if the creation of a new venture is embedded in the new knowledge creation value chain. Moreover, according to Antonelli [8], the generation of an innovative path of growth is possible only if the system can support the entrepreneurial efforts of the agents who are facing unexpected shocks [8]. To better interpret this conceptual approach, we present the anecdotal cases of the Cambridge high-tech cluster and Sassuolo tile district resilient local systems.

Thus, this chapter contributes to the literature firstly by clarifying the meaning of resilience, innovations, and entrepreneurship. These multifaceted concepts, indeed, have been used in different contexts and with several connotations. This has generated some conceptual ambiguities, which need to be resolved in the interest of clarity and ease of implementation of empirical studies and *ad hoc* policies. Moreover, this research, by highlighting the role of innovation and innovative entrepreneurship in fostering resilience, allows us to draw some recommendations for the agenda of contemporary policymakers.

This chapter is organized as follows. In the next section, we clarify the meaning of the term resilience in a wide variety of disciplines, focusing in particular on the adaptive resilience definition. Then, we analyze the concept of innovation following an evolutionary approach. In the fourth section, instead, we present the literature on entrepreneurship. The fifth section focuses on the link between innovation entrepreneurship and resilience and presents the anecdotal cases of Cambridge high-tech cluster and Sassuolo tile district as well. The last part is dedicated to the conclusions and to address possible policy implications.
