Entrepreneurship and the fight against poverty in US cities

Dados Bibliográficos

ID4138931
AutoresNeil Lee (0000-0002-4138-7163, London School of Economics and Political Science), Andrés Rodríguez-Pose (0000-0002-8041-0856, London School of Economics and Political Science, autor correspondente)
Ano2021
Volume53
Fascículo1
Páginas31-52
Data de publicação2021-02-01
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoEnvironment and Planning A Economy and Space (JOURNAL)
Identificadores do periódicoISSN: 0308-518X • E-ISSN: 1472-3409
EditoraSAGE Publications Inc (PUBLISHER)
DOI10.1177/0308518x20924422
OpenAlexW3016291392
IdiomaEN
Citações recebidas14
Referências citadas57

Entrepreneurship is often seen as the cure-all solution for poverty reduction. Proponents argue that it leads to job creation, higher incomes and lower poverty rates in the cities in which it occurs. Others argue that many entrepreneurs are actually creating low-productivity firms serving local markets. Yet, despite this debate, little research has considered the impact of entrepreneurship on poverty in cities. This paper addresses this gap using a panel of US cities for the period between 2005 and 2015. We hypothesize that the impact of entrepreneurship will depend on whether it is in tradeable sectors, so likely to have positive local multiplier effects, or non-tradeable sectors, which may saturate local markets. We find that entrepreneurship in tradeables reduces poverty and increases incomes for non-entrepreneurs, a result we confirm using an instrumental variable approach, taking the inheritance of entrepreneurial traits as the instruments. In contrast, while there are some economic benefits from non-tradeable entrepreneurship, we find these are not large enough to reduce poverty

Demographic economics · Development economics · Econometrics · Economic growth · Economics · Entrepreneurship · Instrumental variable · Labour economics · Panel data · Poverty · Poverty reduction · Productivity · Entrepreneurship Studies and Influences · Firm Innovation and Growth · Labor market dynamics and wage inequality