Entrepreneurial Spillovers Over Space and Time

33 Pages Posted: 14 Nov 2016

See all articles by Frank M. Fossen

Frank M. Fossen

University of Nevada, Reno; IZA Institute of Labor Economics

Thorsten Martin

University of Potsdam

Date Written: November 2016

Abstract

Entrepreneurship is a local and dynamic phenomenon. We jointly investigate spatial spillovers and time persistence of regional new business formation. Using panel data from all 402 German counties for 1996-2011, we estimate dynamic spatial panel models of business creation in the high-tech and manufacturing industries. We consider regions of different sizes and systematically search for the most suitable spatial weighting matrices. We find substantial spatial spillovers as well as time persistence of start-up activity, especially in the high-tech industry. This indicates that entrepreneurship is deeply rooted in regions and underlines the importance of local entrepreneurship culture for new business formation.

Keywords: Entrepreneurship, new business formation, spatial spillovers, path dependency, persistence, spatial panel

JEL Classification: L26, C23, R12, O30

Suggested Citation

Fossen, Frank M. and Martin, Thorsten, Entrepreneurial Spillovers Over Space and Time (November 2016). DIW Berlin Discussion Paper No. 1618, Available at SSRN: https://ssrn.com/abstract=2869046 or http://dx.doi.org/10.2139/ssrn.2869046

Frank M. Fossen (Contact Author)

University of Nevada, Reno ( email )

1664 N. Virginia Street
Reno, NV 89557-0030
United States

HOME PAGE: http://business.unr.edu/faculty/ffossen/

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org/en/webcontent/personnel/photos/index_html?key=2906

Thorsten Martin

University of Potsdam ( email )

August-Bebel Strasse 89
Potsdam, 14482
Germany

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