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Does Population Density have Any Effect On Entrepreneurial Rates? Evidence From US Counties

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  • Hatice Karahan

Abstract

Inspired from the theory of division of labor, I test the hypothesis that self-employment rate declines with a greater density of the population. The motivation is the existence of a huge variation of population densities and a considerable difference in self-employment rates across US states and counties. Results show that a negative and statistically significant impact of population density is present. Hence, people who are located in less crowded areas are more likely to be self-employed. Considering the relatively low availability of good-matching jobs in smaller places, self-employment can be explained as a failure of the size of the market place.

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  • Hatice Karahan, 2013. "Does Population Density have Any Effect On Entrepreneurial Rates? Evidence From US Counties," Journal of Social and Development Sciences, AMH International, vol. 4(3), pages 123-130.
    • Handle: RePEc:rnd:arjsds:v:4:y:2013:i:3:p:123-130
    DOI: 10.22610/jsds.v4i3.742
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