Location of New Firms: Influence of Commuting Behaviour

In the entrepreneurship literature, it is generally assumed that an individual establishes a new firm in a location in which they have strong ties, normally in the municipality of residence or employment. We scrutinise this general assumption and show that firm location depends on individual characteristics, such as the commuting experience. Our results show that commuting influences the firm location choice. The probability of establishing a firm in the work municipality increases if the entrepreneur is a commuter, holding constant the type of region and unobservable and observable individual features.