Abstract
Building on the neo-endogenous rural development model and the resource-based view of the firm, this paper investigates the role of place-based amenities for new firm formation. Empirically, we employ a full-population dataset encompassing new firms in Sweden from 2009 to 2016, combined with geocoded datasets with the spatial distribution of nature- and culture-based amenities. The results show that local amenities are indeed important factors in determining the rate of new firm formation. Estimating the model across urban and rural neighborhoods show that amenities are relatively more important in explaining new firm formation in rural areas as compared to urban. As such, our study contributes to the literature on diversification of the economies of rural areas by pointing at the important role that place-based amenities may play for an entrepreneurially-driven development of less developed and/or rural areas.
Highlights
Ever since the 1990s, the European rural development policy has been the subject of critical discussions among researchers in different fields
Thereby, we provide a conceptual contribution to the literature on ‘smart specialization’ by unravelling the role that place-based amenities may play for an entrepreneurially-driven diversification of less developed regions
Building on the argument that different types of place-based ame nities may interact in their influence on new firm formation, we include a set of interaction terms between the density and industry variables and the nature- and culture-based amenities to investigate if the influence of amenity supply on new firm formation depends on population density and industry composition
Summary
Ever since the 1990s, the European rural development policy has been the subject of critical discussions among researchers in different fields. As noted by Lopez et al (2019: 2115), the operationalization of the process of business discovery has been “one of the major challenges when establishing a Journal of Rural Studies 85 (2021) 32–42 policy of intelligent specialization of regions in Europe” Both policy makers and individual entrepreneurs can gain insight from sci entific evidence that point to the potential role played by place-specific amenities in new firm formation and amenity-spurred entrepreneurship can offer an area to further develop concrete policy tools that enhance firm-level capacities and connections to the surrounding environment. Thereby, we provide a conceptual contribution to the literature on ‘smart specialization’ by unravelling the role that place-based amenities may play for an entrepreneurially-driven diversification of less developed regions
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