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Does Local Firm Ownership Matter?

Author

Listed:
  • David A. Fleming

    (Pennsylvania State University, University Park, PA, USA, The Northeast Regional Center for Rural Development, The Pennsylvania State University, PA, USA)

  • Stephan J. Goetz

    (Pennsylvania State University, University Park, PA, USA, The Northeast Regional Center for Rural Development, The Pennsylvania State University, PA, USA, sgoetz@psu.edu)

Abstract

A data set for U.S. counties that includes residence status of firm owners is used to assess whether per capita density of locally owned businesses affects local economic growth, compared with nonlocal ownership. The database also permits stratification of firms across different employment size categories. Economic growth models that control for other relevant factors reveal a positive relationship between density of locally owned firms and per capita income growth but only for small (10-99 employees) firms, whereas the density of large (more than 500 workers) firms not owned locally has a negative effect. These results provide strong evidence that local ownership matters for economic growth but only in the small size category. Results are robust across rural and urban counties.

Suggested Citation

  • David A. Fleming & Stephan J. Goetz, 2011. "Does Local Firm Ownership Matter?," Economic Development Quarterly, , vol. 25(3), pages 277-281, August.
  • Handle: RePEc:sae:ecdequ:v:25:y:2011:i:3:p:277-281
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    Citations

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    Cited by:

    1. Goetz, Stephan J. & Fleming, David A. & Rupasingha, Anil, 2012. "The Economic Impacts of Self-Employment," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(03), August.
    2. Mark D. Partridge & M. Rose Olfert, 2011. "The Winners' Choice: Sustainable Economic Strategies for Successful 21st-Century Regions," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(2), pages 143-178.
    3. Rupasingha, Anil, 2013. "Locally owned: Do local business ownership and size matter for local economic well-being?," FRB Atlanta Community and Economic Development Discussion Paper 2013-01, Federal Reserve Bank of Atlanta.
    4. Stephan J. Goetz & Anil Rupasingha, 2014. "The Determinants of Self-Employment Growth," Economic Development Quarterly, , vol. 28(1), pages 42-60, February.
    5. Tsvetkova, Alexandra & Partridge, Mark & Betz, Michael, 2016. "Self-employment effects on regional growth: A bigger bang for a buck?," MPRA Paper 75777, University Library of Munich, Germany.
    6. Goetz, Stephen & Partridge, Mark & Stephens, Heather, 2017. "The Economic Status of Rural America in the Trump Era," MPRA Paper 77830, University Library of Munich, Germany.
    7. David Boyle, 2015. "Henry George, Jane Jacobs, and Free Trade," American Journal of Economics and Sociology, Wiley Blackwell, vol. 74(3), pages 587-599, May.
    8. Faggian, Alessandra & Partridge, Mark & Malecki, Ed, 2016. "Creating an environment for economic growth: creativity, entrepreneurship or human capital?," MPRA Paper 71445, University Library of Munich, Germany.
    9. Tessa Conroy & Stephan Weiler, 2016. "Does gender matter for job creation? Business ownership and employment growth," Small Business Economics, Springer, vol. 47(2), pages 397-419, August.
    10. Anil Rupasingha & Stephan J. Goetz, 2013. "Self-employment and local economic performance: Evidence from US counties," Papers in Regional Science, Wiley Blackwell, vol. 92(1), pages 141-161, March.

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