Abstract
Research background: The present study takes the regional economics perspective to explaining new firm registrations. It focuses on the driving role of unemployment rate in the process of new business formation.
 Purpose of the article: The main goal of the study is to investigate the effect of regional unemployment (next to other regional characteristics) on subsequent new business formation in Polish regions for the period 2003?2018. The research hypothesis assumes that a rise in unemployment rate has a positive effect on subsequent new business formation. The positive unemployment push effect is expected to be stronger in operational services.
 Methods: In order to verify the links between unemployment rates and entrepreneurship, panel data methods (fixed effect Driscoll-Kraay and p-VAR estimators) were applied. The analyses were performed at the industry level (manufacturing, construction, wholesale and retail, hotels and restaurants, and financial services) using regional annual data for the period 2003?2018.
 Findings & value added: This study provides further insight into the unemployment push hypothesis by distinguishing between industry sectors and by considering regional specificities in post-communist economies (e.g. Poland). The findings provide value for policy-makers regarding the selection of policy instruments intended to stimulate regional development through entrepreneurship in lagged areas.
Highlights
Entrepreneurial activity typically refers to the leveraging of resources and capabilities through innovation, the identification of opportunities, and the creation of economic and non-economic value (Ahmad & Seymour, 2008)
For the overall entry rate, the analysis revealed correlations that are consistent with the unemployment push effect
The research results confirm the validity of the sectoral approach in exploring the effect of the unemployment rate on new firm dynamic
Summary
Entrepreneurial activity typically refers to the leveraging of resources and capabilities through innovation, the identification of opportunities, and the creation of economic and non-economic value (Ahmad & Seymour, 2008). This point of view emphasises a business opportunity and the risk-taking nature of individuals as the main drivers of entrepreneurship. The literature identifies a different motivation for starting a business, referred to as necessity entrepreneurship. Necessity entrepreneurs are not motivated by market opportunities but are forced into starting a business by the lack of better or even any other prospects of employment (Block & Wagner, 2010). The proportion between the two types of entrepreneurship are crucial to socio-economic development, as necessity entrepreneurs are found to have smaller growth, innovation and employment potential (Fairle & Fossen, 2018)
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