What Determines Entrepreneurial Clusters?

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dc.contributor.author GUISO, Luigi
dc.contributor.author SCHIVARDI, Fabiano
dc.date.accessioned 2011-04-19T12:47:54Z
dc.date.available 2011-04-19T12:47:54Z
dc.date.issued 2011
dc.identifier.citation Journal of the European Economic Association, 2011, 9, 1, 61-86
dc.identifier.issn 1542-4766
dc.identifier.uri http://hdl.handle.net/1814/16492
dc.description.abstract We contrast two potential explanations of the substantial differences in entrepreneurial activity observed across geographical areas: entry costs and external effects. We extend the Lucas model of entrepreneurship to allow for heterogeneous entry costs and for externalities that shift the distribution of entrepreneurial talents. We show that these assumptions have opposite predictions on the relation between entrepreneurial activity and firm-level TFP: with different entry costs, in areas with more entrepreneurs firms' average productivity should be lower; with heterogeneous external effects it should be higher. We test these implications on a sample of Italian firms and unambiguously reject the entry costs explanation in favor of the externalities explanation. We also investigate the sources of external effects, finding robust evidence that learning externalities are an important determinant of cross-sectional differences in entrepreneurial activity.
dc.language.iso en
dc.publisher Wiley-Blackwell
dc.subject D24
dc.subject D62
dc.subject J23
dc.title What Determines Entrepreneurial Clusters?
dc.type Article
dc.identifier.doi 10.1111/j.1542-4774.2010.01006.x
dc.neeo.contributor GUISO|Luigi|aut|EUI70005
dc.neeo.contributor SCHIVARDI|Fabiano|aut|
dc.identifier.volume 9
dc.identifier.startpage 61
dc.identifier.endpage 86
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dc.identifier.issue 1

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