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Regional differences in structural characteristics of start-ups

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  • Franz Tödtling
  • Herta Wanzenböck

Abstract

In recent years new firm formation has become a major area of both research and policy. Yet, while regional differences in business start-up intensity, and their causes, have been the subject of various studies, few attempts have been made to investigate spatial variation in the structural features of start-ups. Theoretical considerations and the existing literature both suggest that agglomeration advantages and sectoral structure of regions figure prominently among the factors important in influencing start-up activity and characteristics. In the empirical analysis of start-ups in Austria we accordingly apply a regional typology based on these two factors. The data analysed were drawn from two similarly designed surveys relating to the years 1990 and 1997. It is shown that Austria displays marked regional differences in start-up activity, in terms of both intensity and characteristics. In line with the urban incubator hypothesis, tertiary centres - above all the Vienna region - displayed significantly above-average start-up rates, as well as more favourable structural characteristics of the new firms. Start-up activity in old industrial and in rural areas was substantially lower than average, structural features also being less positive there. Furthermore, the 1990 cohort displayed regional differences in business start-ups' survival period, although the Cox model indicated no significant direct influence of area type in this respect. In economic policy terms it can be concluded that, as well as a general improvement in the environment for start-ups, greater regional differentiation of financial, informational and consultancy support is desirable, since not only the conditions for new firm formation but also the intensity and characteristics of start-ups themselves vary considerably between regions.

Suggested Citation

  • Franz Tödtling & Herta Wanzenböck, 2003. "Regional differences in structural characteristics of start-ups," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 15(4), pages 351-370, October.
  • Handle: RePEc:taf:entreg:v:15:y:2003:i:4:p:351-370
    DOI: 10.1080/0898562032000058923
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    File URL: http://hdl.handle.net/10.1080/0898562032000058923
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    Cited by:

    1. Capelleras , Joan-Lluís & Contín-Pilart , Ignacio & Martin-Sanchez, Victor & Larraza-Kintana , Martín, 2013. "The influence of individual perceptions and the urban/rural environment on nascent entrepreneurship," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 26, pages 97-113.
    2. Lee, In Hyeock & Hong, Eunsuk & Sun, Laixiang, 2013. "Regional knowledge production and entrepreneurial firm creation: Spatial Dynamic Analyses," Journal of Business Research, Elsevier, vol. 66(10), pages 2106-2115.

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