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Analyzing the determinants of entrepreneurship in European cities

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  • Andrés Barreneche García

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    Abstract

    This study investigated the determinants of business creation as a measure of entrepreneurship in European cities. It examined supply- and demand-side elements, actual and equilibrium rates of entrepreneurship, institutions and culture. These components were characterized using a dataset consisting of 21 indicators drawn from 184 cities in 20 European countries during the years 1999–2010. The study found that city size, self-employment, and tertiary education have a significant and positive impact on the number of new businesses registered. The implications of these findings are discussed in view of the European Commission’s Small Business Act, which provides guidelines for the conception and implementation of entrepreneurship policies in the European Union. This paper’s main contribution lies in the differentiation of factors that are context-specific (e.g., city-size) and others that can be influenced by policy (e.g., tertiary education). Copyright Springer Science+Business Media New York 2014

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    File URL: http://hdl.handle.net/10.1007/s11187-012-9462-8
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    Bibliographic Info

    Article provided by Springer in its journal Small Business Economics.

    Volume (Year): 42 (2014)
    Issue (Month): 1 (January)
    Pages: 77-98

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    Handle: RePEc:kap:sbusec:v:42:y:2014:i:1:p:77-98

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    Web page: http://www.springerlink.com/link.asp?id=100338

    Related research

    Keywords: Entrepreneurship; Business creation; Self-employment; Europe; Cities; Agglomeration; Policy; C21; C38; L26; L50; M13; O52; R10;

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    1. Edward L. Glaeser, 2007. "Entrepreneurship and the City," NBER Working Papers 13551, National Bureau of Economic Research, Inc.
    2. Robert J. Barro & Rachel McCleary, 2003. "Religion and Economic Growth," NBER Working Papers 9682, National Bureau of Economic Research, Inc.
    3. Zoltán Ács & Attila Varga, 2005. "Entrepreneurship, Agglomeration and Technological Change," Small Business Economics, Springer, vol. 24(3), pages 323-334, 02.
    4. Baumol, William J, 1990. "Entrepreneurship: Productive, Unproductive, and Destructive," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 893-921, October.
    5. Sobel, Russell S., 2008. "Testing Baumol: Institutional quality and the productivity of entrepreneurship," Journal of Business Venturing, Elsevier, vol. 23(6), pages 641-655, November.
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    7. Robert J. Barro & Xavier Sala-i-Martin, 2003. "Economic Growth, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262025531, December.
    8. Mark Doms & Ethan Lewis & Alicia Robb, 2010. "Local Labor Force Education, New Business Characteristics, and Firm Performance," NBER Chapters, in: Cities and Entrepreneurship National Bureau of Economic Research, Inc.
    9. Rolf Sternberg & Sander Wennekers, 2005. "Determinants and Effects of New Business Creation Using Global Entrepreneurship Monitor Data," Small Business Economics, Springer, vol. 24(3), pages 193-203, 01.
    10. Isabel Grilo & Jesus-Maria Irigoyen, 2006. "Entrepreneurship in the EU: To Wish and not to be," Small Business Economics, Springer, vol. 26(4), pages 305-318, 05.
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    12. Keith Head & Thierry Mayer, 2004. "Non-Europe : the magnitude and causes of market fragmentation in the EU," Cahiers de la Maison des Sciences Economiques bla99004a, Université Panthéon-Sorbonne (Paris 1).
    13. Rosenthal, Stuart S. & Ross, Amanda, 2010. "Violent crime, entrepreneurship, and cities," Journal of Urban Economics, Elsevier, vol. 67(1), pages 135-149, January.
    14. Earle, John S. & Sakova, Zuzana, 2000. "Business start-ups or disguised unemployment? Evidence on the character of self-employment from transition economies," Labour Economics, Elsevier, vol. 7(5), pages 575-601, September.
    15. Roy Thurik & Andreas Freytag, 2006. "Entrepreneurship and its determinants in a cross-country setting," Scales Research Reports H200616, EIM Business and Policy Research.
    16. David Audretsch & Michael Fritsch, 2002. "Growth Regimes over Time and Space," Regional Studies, Taylor & Francis Journals, vol. 36(2), pages 113-124.
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