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Building the rural economy with high-growth entrepreneurs

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  • Jason Henderson

Abstract

Entrepreneurs create economic growth in their communities by forming new firms. Each year during the past decade, more than half a million businesses were started that added new jobs in the United States. In the 1990s, during the longest economic expansion in the United States economy, the majority of new jobs were created by small and medium-sized entrepreneurs operating high-growth businesses.> Because entrepreneurs are such a wellspring of growth in the economy, many rural policymakers have shifted their long-time focus of recruiting existing firms, such as branch plants, to developing new entrepreneurs. New policies generally support a wide range of entrepreneurs. However, policies often fail to recognize that the benefits of entrepreneurs can vary dramatically, depending on the entrepreneur’s desire to build a high-growth business. And rural areas often lack these high-growth entrepreneurs.> Henderson reviews entrepreneurial activity in rural America and discusses some of the new ways policymakers are beginning to encourage high-growth entrepreneurs in their communities. After discussing the benefits entrepreneurs offer communities, he examines the pattern of entrepreneurship in rural areas and the difficulties many rural communities face in supporting high-growth entrepreneurs. Finally, he discusses some of the policies supporting the startup and growth of this valuable resource.

Suggested Citation

  • Jason Henderson, 2002. "Building the rural economy with high-growth entrepreneurs," Economic Review, Federal Reserve Bank of Kansas City, issue Q III, pages 45-70.
  • Handle: RePEc:fip:fedker:y:2002:i:qiii:p:45-70:n:v.87no.3
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    1. repec:wsi:jdexxx:v:22:y:2017:i:02:n:s1084946717500108 is not listed on IDEAS
    2. Sarah Low & Jason Henderson & Stephan Weiler, 2005. "Gauging a region's entrepreneurial potential," Economic Review, Federal Reserve Bank of Kansas City, issue Q III, pages 61-89.
    3. Herrera-Echeverri, Hernán & Haar, Jerry & Estévez-Bretón, Juan Benavides, 2014. "Foreign direct investment, institutional quality, economic freedom and entrepreneurship in emerging markets," Journal of Business Research, Elsevier, vol. 67(9), pages 1921-1932.
    4. Marshall, Maria I. & Samal, Ananya, 2006. "The Effect of Human and Financial Capital on the Entrepreneurial Process: An Urban-Rural Comparison of Entrepreneurs in Indiana," 2006 Annual meeting, July 23-26, Long Beach, CA 21155, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Singh-Knights, Doolarie & Smith, Dennis K. & Budumuru, Yoganand, 2006. "Determinants of Entrepreneurship and Small Business Activity: A Two-Stage Regression Analysis," 2006 Annual meeting, July 23-26, Long Beach, CA 21447, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Panizzon, Marion & Sieber-Gasser, Charlotte, 2010. "Legal Framework for Cross-Regional Networks: The Case of Services and Migration," Papers 98, World Trade Institute.
    7. Bologna, Jamie, 2014. "A Spatial Analysis of Entrepreneurship and Institutional Quality: Evidence from U.S. Metropolitan Areas," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 44(2).
    8. Garcia Alvarez-Coque, Jose-Maria & Lopez-Garcia Usach, T. & Sanchez Garcia, M., 2012. "Territory and innovation behaviour in agri-food firms: does rurality matter?," 126th Seminar, June 27-29, 2012, Capri, Italy 126030, European Association of Agricultural Economists.
    9. María Jesús Rodríguez-Gulías & David Rodeiro-Pazos & Sara Fernández-López, 2016. "The Regional Effect on the Innovative Performance of University Spin-Offs: a Multilevel Approach," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 7(4), pages 869-889, December.
    10. Conley, Kelsey & Whitacre, Brian, 2015. "Does Broadband Matter for Rural Entrepreneurs or ‘Creative Class’ Employees?," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196832, Southern Agricultural Economics Association.
    11. Russell Sobel & J. Clark & Dwight Lee, 2007. "Freedom, barriers to entry, entrepreneurship, and economic progress," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 20(4), pages 221-236, December.
    12. Maikudi Shehu Musawa & Eta Wahab, 2012. "The adoption of electronic data interchange (EDI) technology by Nigerian SMEs: A conceptual framework," E3 Journal of Business Management and Economics., E3 Journals, vol. 3(2), pages 055-068.
    13. repec:wsi:wschap:9781786343482_0001 is not listed on IDEAS
    14. Curtiss, Jarmila, 2012. "Determinants of Financial Capital Use: Review of theories and implications for rural businesses," Factor Markets Working Papers 123, Centre for European Policy Studies.
    15. Egbetokun, A & Siyanbola, W & Olamade, O & Adeniyi, A & Irefin, I, 2008. "Innovation in Nigerian SMEs: types and impact," MPRA Paper 25338, University Library of Munich, Germany, revised 2008.
    16. Marianna Markantoni & Sierdjan Koster & Dirk Strijker, 2014. "Side-activity entrepreneur: lifestyle or economically oriented?," Chapters,in: Agglomeration, Clusters and Entrepreneurship, chapter 7, pages 132-156 Edward Elgar Publishing.
    17. Luminitaa Nicolescu & Irina Alina Popescu & Ciprian Nicolescu, 2013. "Romanian SMEs During the Crisis: Economic Results and Perceptions," Management, University of Primorska, Faculty of Management Koper, vol. 8(1), pages 5-19.
    18. 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.
    19. Colino, Alberto & Benito-Osorio, Diana & Rueda-Armengot, Carlos, 2014. "Entrepreneurship culture, total factor productivity growth and technical progress: Patterns of convergence towards the technological frontier," Technological Forecasting and Social Change, Elsevier, vol. 88(C), pages 349-359.
    20. repec:bla:afrdev:v:29:y:2017:i:2:p:259-271 is not listed on IDEAS
    21. Jose Cadima Ribeiro & Jose Freitas Santos, 2006. "Regional Products, Regions' Reputation and Commercial Strategies: A Tale of Two Cheese Suppliers," ERSA conference papers ersa06p66, European Regional Science Association.
    22. Curtiss, Jarmila, 2012. "Determinants of Financial Capital Use: Review of theories and implications for rural businesses," Working Papers 122846, Factor Markets, Centre for European Policy Studies.
    23. David Devins & George Lodorfos & Ioannis Kostopoulos & Don Webber, 2017. "Innovation And Growth In The City Region: Microeconomic Evidence Of Asymmetries," World Scientific Book Chapters,in: Promoting Innovation in New Ventures and Small- and Medium-Sized Enterprises, chapter 1, pages 3-27 World Scientific Publishing Co. Pte. Ltd..
    24. Sobel, Russell S. & King, Kerry A., 2008. "Does school choice increase the rate of youth entrepreneurship?," Economics of Education Review, Elsevier, vol. 27(4), pages 429-438, August.

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    Keywords

    Rural areas ; Rural development;

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