The Small Business Administration’s Office of Advocacy has released a report on business clustering and entrepreneurship, written by Lawrence A. Plummer of the University of Oklahoma. Looking at U.S. Census Bureau data on business startups from 1990-2006, Plummer analyzes how changes in population, income growth, educational attainment, and business density–among other factors–contribute to regional entrepreneurial development.
From the executive summary:
In raw counts, Los Angeles, Cook (Chicago), and New York counties have the highest levels of entrepreneurial activity. Rankings by the rate of firm births per 1,000 workers in each given sector suggest that the nation’s interior and northwestern counties—especially in states like Colorado, Utah, Washington, and others—had the highest levels of entrepreneurial activity per person during the study period. This finding is consistent with the level of westward migration over the last two decades. The mapping and spatial analysis indicate that entrepreneurial activity concentrates geographically. The entrepreneurial lows of the nation’s Rust Belt states and the entrepreneurial highs of the Rocky Mountain regions are evident. A pivotal determinant for this pattern appears to be changes in county population. The spatial analysis indicates several pockets of significant start-up activity, including manufacturing in the Pacific Northwest; retail trade and local market industries in the Rocky Mountain States; high technology industries in California, Massachusetts, and North Carolina; extractive industries in Texas, Oklahoma, and Wyoming; business services in New York, Washington, DC, and Florida; and distributive industries in the plains states.