ENTREPRENEURSHIP IN RURAL AMERICA ACROSS TYPOLOGIES, GENDER AND MOTIVATION

Abstract

This study examines the effect of rurality on early-stage necessity and opportunity entrepreneurship among women and men in America from three rural typology perspectives. To achieve this objective, we build a dataset that combines GEM U.S. individual data for 2005—2010 and county economic characteristics from the Bureau of Labor Statistics and the Census Bureau. We use three typologies to define rurality and compare the results, the OMB metro-nonmetro classification system (2003), Isserman (2005) and county population density. We further analyze this data in subsamples by gender using cross-section time-series rare events logistic regression with clustered robust errors and year fixed effects. Key findings indicate the three rural typologies show similar results in magnitude, direction and significance, although population density shows sensitivity to the rurality variable and subsamples. Also, compared to women in OMB metro counties in America, women who live in OMB nonmetro counties have a higher probability of engaging in opportunity entrepreneurship. This probability increases with college education and decreases if the woman lives alone or is retired. Among men, living in OMB nonmetro or Isserman rural counties also increases their probability of engaging in opportunity entrepreneurship. College education and being African American also increases this probability. Predictors of necessity entrepreneurship are having an income below 50,000 among women and being employed part time among men.