Abstract
Abstract This paper integrates imprinting theory and insights from rural/spatial entrepreneurship research to develop the concept “liability of rurality”. In the paper I argue why increasing rurality of geographical space should be considered a penalty for entrepreneurs. Further, I propose how rurality – as a liability - may influence the emergence, survival and growth prospects of new ventures. This includes a theoretical integration between the liability of rurality and the universal liabilities of newness and smallness. The paper ends with a research agenda discussing how the liability of rurality can add to and rejuvenate spatial and rural entrepreneurship research.
Highlights
It has been increasingly emphasized that the dynamics of new venture creation and entrepreneurship are fundamentally influenced by context (Welter, 2011; Welter et al, 2018) and that differences in contextual variables need to be included in entrepreneurship theories (Zahra, 2007, 2008)
While rurality represents a penalty for emerging firms, research shows that new firms ready to compete are established in rural spaces. This does not necessarily suggest that such ventures have overcome the liability of rurality, even though they have managed to overcome its influence in the earlier stages of the entrepreneurial process
The liability of rurality is a new perspective on rural entrepreneurship and a new concept minted in this paper
Summary
It has been increasingly emphasized that the dynamics of new venture creation and entrepreneurship are fundamentally influenced by context (Welter, 2011; Welter et al, 2018) and that differences in contextual variables need to be included in entrepreneurship theories (Zahra, 2007, 2008). Spatial conditions and the rurality of geographical space represent a crucial contextual influence on entrepreneurship in this regard (Florida et al, 2017; Stuetzer et al, 2016; Westlund et al, 2014; Audretsch et al, 2017; Patterson and Anderson, 2003) This is reflected in burgeoning empirical research showing that new venture creation, entrepreneurial activities and behaviors are not evenly distributed across space but are fundamentally shaped by it (e.g., Armington and Acs, 2002; Müller, 2016; Baumgartner et al, 2013; Pato and Teixeira, 2016; Trettin and Welter, 2011; Bečicová and Blažek, 2015). I combine imprinting theory and spatial/rural entrepreneurship research (e.g., Bosma and Sternberg, 2014; Freire-Gibb and Nielsen, 2014; Nikolaev and Wood, 2018), to develop conceptual propositions about how rurality of the founding context may influence the economic viability of new ventures, especially their emergence, survival and growth prospects. I help extend research on the “dark side of the rural idyll” (Somerville et al, 2015) and suggest how rurality may be a penalty for productive entrepreneurship and may even turn potentially productive entrepreneurship into unproductive (Baumol, 1990)
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