Handbook of Research on Entrepreneurship and Regional Development

Handbook of Research on Entrepreneurship and Regional Development

National and Regional Perspectives

Elgar original reference

Edited by Michael Fritsch

Recent research has found pronounced differences in the level of entrepreneurship and new business formation across various regions and nations. This timely Handbook reveals that the development of new ventures as well as their effects on overall economic growth are strongly shaped by their regional and national environment. The expert group of contributors gives an overview on the current state of the art in this field, and proposes avenues for further investigation. Topics include the regional determinants of new business formation, the effects of start-ups on growth, the role of globalization for regional entrepreneurship, the effect of national and regional framework conditions, as well as the role of universities as incubators of innovative new firms.

Chapter 1: The Role of New Businesses in Regional Development: Introduction and Overview

Michael Fritsch

Subjects: business and management, entrepreneurship, economics and finance, regional economics, urban and regional studies, regional economics


Michael Fritsch FORMATION OF NEW BUSINESSES, POLICY, AND REGIONAL GROWTH Politicians expend a great deal of effort on attempting to reduce unemployment and stimulate economic growth. Policy programs specifically intended to create additional employment can be found at the regional, national, and supranational levels. Historically, such measures focused on the performance of large incumbent firms and more or less ignored the role that new businesses play in economic development. It was not until the late 1970s that policymakers became conscious of the important contributions that new businesses make to employment and growth. The last few decades have witnessed a considerable amount of empirical research on entrepreneurship, particularly on the formation and effects of new businesses, leading to substantial progress in this important field. One important result of recent research is that the factors that influence entrepreneurship vary considerably between nations and, particularly, between regions. Entrepreneurship is a regional event. Region-specific characteristics influence not only the level of new business formation, but also the type of new business that is created, for example innovative, knowledge-intensive, or high-growth start-ups. Moreover, the effects  of entrepreneurship on development can also vary between nations and regions. In fact, in some countries or regions, new business formation is accompanied by significant employment growth, while the effect on employment may be negligible or even negative in other countries or regions. Currently, this variation in the effect of certain types of entrepreneurship on economic development and the role of the spatial environment are not well understood. OVERVIEW OF...