The Determinants of New-firm Survival across Regional Economies
Motivated by differences in new-firm survival across regions, this paper explores the impact of regional human capital on new-firm survival rates. New-firm survival is interpreted through formation rates of surviving versus closed firms in the service sector. By incorporating knowledge spillovers through a geographical variation model for Labor Market Areas, we empirically test the relationship between regional human capital stocks and new-firm survival. The expected positive relationship between regional human capital and new-firm survival is supported for the period 1993-1995, but is not as strong for the recession period 1990-1992. Controlling for human capital, the new-firm survival rate is negatively related to service sector specialization and positively related to all industry intensity, suggesting that city size and diversity may be an important determinant of new-firm survival in both periods.
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- Acs, Zoltan J. & Armington, Catherine, 2004.
"The impact of geographic differences in human capital on service firm formation rates,"
Journal of Urban Economics,
Elsevier, vol. 56(2), pages 244-278, September.
- Zoltan J. Acs & Catherine Armington, 2004. "The Impact of Geographic Differences in Human Capital on Service Firm Formation Rates," Papers on Entrepreneurship, Growth and Public Policy 2004-15, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
- Ian Smith & Zoltan J. Acs & Felix R. FitzRoy, 2002. "High-technology employment and R&D in cities: Heterogeneity vs specialization," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 36(3), pages 373-386.
- Zoltan J. Acs & Catherine Armington, 2004.
"Employment Growth and Entrepreneurial Activity in Cities,"
Papers on Entrepreneurship, Growth and Public Policy
2004-13, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
- Zoltan Acs & Catherine Armington, 2004. "Employment Growth and Entrepreneurial Activity in Cities," Regional Studies, Taylor & Francis Journals, vol. 38(8), pages 911-927.
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