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Does Rural Location Matter? The Significance Of A Rural Setting For Small Businesses

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  • JEFFREY F. SHIELDS

    (School of Business, University of Southern Maine, P.O. Box 9300, Portland, ME 04104-9300, USA)

Abstract

Rural settings in the United States have characteristics that present a unique context for small business, often portrayed as adverse. Studies of rural entrepreneurs and small businesses, however, frequently fail to provide data on the rural context and its potential relationship to small business, taking for granted presumed attributes and adverse effects. To develop a better understanding of a rural setting's importance, this research investigated effects of rural geo-demographic and socio-cultural features on 76 small businesses. Results demonstrate that rural geo-demography adversely affects marketability of products and services although there is little adversity for small businesses due to constrained resources (financing, technology, and transportation) or labor issues. Business owners manage their businesses consistent with rural socio-cultural values by relying on strong social ties and word of mouth reputation. However, women-owned businesses experience little adversity due to gender stereotypes. The rural setting considered in the study has varying implications for different types of businesses and for business owners according to how long they have lived in the community. Its effects are neither adverse in all respects nor universal for all small businesses.

Suggested Citation

  • Jeffrey F. Shields, 2005. "Does Rural Location Matter? The Significance Of A Rural Setting For Small Businesses," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 10(01), pages 49-63.
    • Handle: RePEc:wsi:jdexxx:v:10:y:2005:i:01:n:s1084946705000057
    DOI: 10.1142/S1084946705000057
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    Cited by:

    1. Kevin N. Kim & Ani L. Katchova, 2022. "Agricultural bank acquisitions and postacquisition performance: An examination of the role of shared knowledge," Agribusiness, John Wiley & Sons, Ltd., vol. 38(4), pages 743-770, October.
    2. Séverine Saleilles, 2010. "Les trajectoires des entrepreneurs néo-ruraux," Post-Print halshs-00659540, HAL.
    3. Charisia Vlachou & Olga Iakovidou & Panagiota Sergaki & Georgios Menexes, 2021. "The Entrepreneurial Environment in Greek Rural Areas: The Entrepreneur’s Viewpoint," Sustainability, MDPI, vol. 13(4), pages 1-15, February.
    4. Tia Michelle McDonald & Maria I. Marshall & Michael S. Delgado, 2017. "Is Working with Your Spouse Good for Business? The Effect of Working with Your Spouse on Profit for Rural Businesses," Journal of Family and Economic Issues, Springer, vol. 38(4), pages 477-493, December.
    5. Madani, Fatima & Seenivasan, Satheesh & Ma, Junzhao, 2021. "Determinants of store patronage: The roles of political ideology, consumer and market characteristics," Journal of Retailing and Consumer Services, Elsevier, vol. 63(C).
    6. Masakure, Oliver & Cranfield, John & Henson, Spencer, 2008. "The Financial Performance of Non-farm Microenterprises in Ghana," World Development, Elsevier, vol. 36(12), pages 2733-2762, December.
    7. Eileen M. Trauth & Michael DiRaimo Jr. & M. Richard Hoover Jr. & Paul Hallacher, 2015. "Leveraging a Research University for New Economy Capacity Building in a Rural Industrial Region," Economic Development Quarterly, , vol. 29(3), pages 229-244, August.
    8. Jaume Benseny & Juuso Toyli & Heikki Hammainen & Andr'es Arcia-Moret, 2019. "The mitigating role of regulation on the concentric patterns of broadband diffusion. The case of Finland," Papers 1905.03002, arXiv.org, revised Oct 2020.
    9. Teresa Maria Gamito & Lívia Madureira & José Manuel Lima Santos, 2021. "Unveiling and typifying rural resources underpinned by innovation dynamics in rural areas," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(3), pages 457-477, June.

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