Location Choices of Graduate Entrepreneurs

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Author Information : Johan P Larsson (Jonkoping International Business School, Jonkoping University)
Karl Wennberg (Institute for Analytical Sociology, Linkoping University)
Johan Wiklund (Whitman School of Management, Syracuse University)
Mike Wright (Imperial College)

Year of Publication : Research Policy (2017)

Summary of Findings : Those that graduate from metropolitan universities tend to start businesses where they go to school, whereas those graduating from less densely populated areas often move to start businesses, unless they were born where they went to school.

Research Questions : 1. Who are more or less likely to start a business upon graduation?

2. Where do those who start a business upon graduation locate?

What we know : University graduates are far more important in generating startups than university employees. They are also at their most mobile life stage. Later in life they are far less mobile. Therefore, where they locate their businesses has long term implications for the localization of entrepreneurship and economic development.

Novel Findings : This is the first study examining the localization choices of university graduates who start businesses.

Implications for Practice : University graduates starting business are part of, and reinforce, the strong trend of increasing economic agglomeration to main metropolitan hubs.

Implications for Policy: Universities outside metropolitan areas may benefit from developing new strategies to maintain graduate entrepreneurs not born in the vicinity who may be lacking the local ties evidenced to enhance their location choice in the region.

Full Citations : Larsson, J.P., Wennberg, K., Wiklund, J. & Wright, M. (2017). Location Choices of Graduate Entrepreneurs. Research Policy

Abstract : We review complementary theoretical perspectives on location choices of university graduate entrepreneurs derived from the individual-opportunity nexus and local embeddedness perspectives on entrepreneurship. Analysis of the full population of 215,388 graduates from Swedish institutions of higher education between 2002 and 2006 provides support for both location choice perspectives. Overall, 63 percent of graduate entrepreneurs start businesses locally in their region of graduation while 37 percent start businesses elsewhere. The likelihood of starting locally is substantially higher in metropolitan regions, if the graduate was born locally or has university peer entrepreneurs and entrepreneurial family members in the region of graduation. Implications for theory and public policy are discussed.

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Entrepreneurship research recently accepted to Research Policy finds those that graduate from metropolitan universities tend to start businesses where they go to school, whereas those graduating from less densely populated areas often move to start businesses, unless they were born where they went to school.

Johan Wiklund

Johan Wiklund

Johan Wiklund is the Al Berg Endowed Chair and Professor of Entrepreneurship at Whitman School of Management, Syracuse University, USA and professor at Lund University, Sweden, and Nordland University, Norway. His research interests include entrepreneurship and mental health as well as the performance, growth, exit, and failure of entrepreneurial firms. He is considered a leading authority in entrepreneurship research with over 50 articles appearing in leading entrepreneurship and management journals. He is editor for Entrepreneurship Theory and Practice, and previously editor for Journal of Business Venturing and Small Business Economics.
Johan Wiklund

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