Geographies of Growth
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Geographies of Growth

Innovations, Networks and Collaborations

Edited by Charlie Karlsson, Martin Andersson and Lina Bjerke

Today we can observe an increasing spatial divide as some large urban regions and many more medium-sized and small regions face growing problems such as decreasing labour demand, increasing unemployment and an ageing population. In view of these trends, this book offers a better understanding of the general characteristics and specific drivers of the geographies of growth. It shows how these may vary in different spatial contexts, how hurdles and barriers to growth in different types of regions can be dealt with, how and to what extent resources in different areas can develop, and how the potential of these resources to stimulate growth can be realized.
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Chapter 8: The impact of individual characteristics and regional agglomeration on the survival of self-employed firms

Innovations, Networks and Collaborations

Viroj Jienwatcharamongkhol and Sam Tavassoli

Extract

Entrepreneurship has been a key agenda in recent decades among national policies worldwide, resulting to programmes and legislations aiming at converting unemployment into jobs or self-employment, among other things.1 In Sweden, a shift towards SMEs and entrepreneurship was evident during the 1990s when the country saw a decrease in employment among many large private firms and the public sector. The Swedish National Board for Industrial and Technical Development (NUTEK) was established in 1991 to promote entrepreneurship-oriented policies.2 A gradual move towards a more entrepreneurship-oriented policy has been emphasized by several key events, especially the approval of the Lisbon agenda by the European Union in 2000 and the newly elected conservative government in 2006, where we see a stronger emphasis on entrepreneurship as part of the strategic policies, both at the national and regional levels.3 Despite the fact that self-employed firms comprise a significant share of firms in terms of number, their duration of business is relatively short. In Sweden, the total number of firms with less than 20 employees amounts to 98 percent and is responsible for 33 percent of employment (data for 2009 from Structural Business Statistics by Statistics Sweden). Less than 60 percent of these self-employed firms survive the first year of operation and only 17 percent stay in business after five years.4 The explanations behind the untimely closure of these firms are a topic of much research but the consensus has not yet been reached. Millan, Congregado and Roman (2012) reflect that self-employment promotion policy agenda ‘was prior to the proliferation of propositions and empirical findings’, which suggests that the effectiveness of these policies is questionable. Therefore, the importance of understanding the factors that affect the survival of these firms is that it will yield an insight into various aspects of entrepreneurship research that may have a far-reaching policy implication.5

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