Spatially Varying Relationships of New Firm Formation in the United States

CHENG S. and LI H. Spatially varying relationships of new firm formation in the United States, Regional Studies. This paper seeks to examine spatially varying relationships between new firm formation and its determinants across US counties. A geographically weighted regression (GWR) technique is calibrated with firm birth data in ten separate industries over the period 2001-2003. Results of GWR analysis support the existence of spatially varying relationships and show significant local variations, in magnitudes and/or signs, of new business creation in all the ten sectors investigated. The local variations were masked in traditional ordinary least-squares (OLS) global analysis. This paper is also intended to inform policy-makers and professionals about location-specific relationships and reject 'one-size-fits-all' public policies.