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The effects of new firm formation on regional development over time : the case of Great Britain

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Mueller, Pamela, Stel, André van and Storey, D. J.. (2008) The effects of new firm formation on regional development over time : the case of Great Britain. Small Business Economics, Vol.30 (No.1). pp. 59-71. ISSN 0921-898X

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Abstract

This paper re-examines the link between new firm formation and subsequent employment growth. It investigates whether it is possible to have the wrong type of entrepreneurship-defined as new firm formation which leads to zero or even negative subsequent employment growth. It uses a very similar approach to that of Fritsch and Mueller (Regional Studies, 38(8), 961-976, 2004), confirming their findings that the employment impact of new firm formation is in three discrete phases. Then, using data for Great Britain, the paper shows the employment impact of new firm formation is significantly positive in the high-enterprise counties of Great Britain. However, for the low-enterprise counties, it shows that new firm formation has a negative effect on employment. Of the 15 low-enterprise regions, eight are Scottish (of nine Scottish regions in our data base) and three are North East Counties (of four). Our findings imply that having the "wrong type of entrepreneurship" is indeed possible.

Item Type: Journal Article
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HF Commerce
Divisions: Faculty of Social Sciences > Warwick Business School > Centre for Small & Medium-Sized Enterprises
Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH): New business enterprises -- Great Britain, Employment (Economic theory), Entrepreneurship -- Great Britain, Regional economics -- Great Britain
Journal or Publication Title: Small Business Economics
Publisher: Springer New York LLC
ISSN: 0921-898X
Official Date: January 2008
Volume: Vol.30
Number: No.1
Number of Pages: 13
Page Range: pp. 59-71
Identification Number: 10.1007/s11187-007-9056-z
Status: Peer Reviewed
Publication Status: Published
Access rights to Published version: Restricted or Subscription Access
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URI: http://wrap.warwick.ac.uk/id/eprint/31080

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