Article Dynamic Capabilities and Entrepreneurial Ecosystems: The Micro-Foundations of Regional Entrepreneurship Philip T. Roundy 1 Dutch Fayard 2 Abstract In pursuit of the beneficial outcomes of entrepreneurship, governments and regional development organisations enact policies to stimulate entrepreneurial activity. A growing focus of policymakers in emerging and developed economies is the promotion of entrepreneurial ecosys- tems: the interconnected system of forces that generate and sustain regional entrepreneurship. Despite intense interest in entrepreneu- rial ecosystems, the topic is under-theorised. Studies draw attention to the positive effects of entrepreneurial ecosystems on the creation and functioning of early-stage ventures; however, the specific mecha- nisms through which ecosystems influence entrepreneurs are not clear. To address this issue, we build on dynamic capabilities theory to create a theoretical framework that identifies a set of forces through which The Journal of Entrepreneurship 1–27 © 2018 Entrepreneurship Development Institute of India Reprints and permissions: in.sagepub.com/journals-permissions-india DOI: 10.1177/0971355718810296 journals.sagepub.com/home/joe 1 Summerfield Johnston Centennial Scholar, Department of Marketing and Entrepreneurship, University of Tennessee at Chattanooga, College of Business, Chattanooga, TN, USA. 2 Assistant Professor, Department of Accounting, University of Tennessee at Chattanooga, Gary W. Rollins College of Business, Chattanooga, TN, USA. Corresponding author: Philip T. Roundy, Fletcher Hall (412G), Department of Marketing and Entrepreneurship, University of Tennessee at Chattanooga, Gary W. Rollins College of Business, Chattanooga, TN 37403-2598, USA. E-mail: philip-roundy@utc.edu