Document Type
Book Chapter
Recommended Citation
Franquesa, J., Anokhin, S. and Mwaka, J. (2009), "Explaining entrepreneurial transience: the role of local taxation policy", Lumpkin, G.T. and Katz, J.A. (Ed.) Entrepreneurial Strategic Content (Advances in Entrepreneurship, Firm Emergence and Growth, Vol. 11), Emerald Group Publishing Limited, Bingley, pp. 193-224. https://doi.org/10.1108/S1074-7540(2009)0000011009
Abstract
Geographical relocation of ventures, together with rates of firm formation and closure, determine the entrepreneurial population dynamics of a region. However, venture migration has remained largely unaddressed by prior entrepreneurship scholars. This paper draws from theoretical frameworks and prior findings in the economic demography literature to explore policy and environmental determinants of regional venture migration rates, referred to as entrepreneurial transience. Using county-level data for the state of Ohio, we show that local taxation is an important driver of entrepreneurial transience. In particular, local income tax rates are found to be negatively related to subsequent net transience – i.e., venture migration deficits or surpluses. Local business property taxes also influence net transience, but the direction of their impact depends on the average income level in the locale.
Publication Date
1-1-2009
Notes
This work was created while Dr. Jaume Franquesa was a member of Kent State University. This work is listed in our repository as part of our Faculty CV Program. Click here for more information regarding the program.