City economies and microbusiness growth
City economies and microbusiness growth
In developed countries, microbusinesses (those employing fewer than 10 people) and homebased businesses have been systematically overlooked in urban economic development thinking. This article assesses the influence of city location and being run from the business owner’s home on microbusiness growth, based on empirical analysis of panel firm-level data over a four-year
period during the UK’s long boom. The analysis reveals that cities provide benefits to micro businesses for turnover growth but not for employment growth – suggesting that the additional growth induced by cities for microbusinesses may be jobless growth. However, in the case of microbusinesses run from the owner’s home, cities facilitate growth into medium-sized businesses (with 50+ staff). In conclusion, microbusinesses, including those run from business owners’
homes, are integral to the evolution and dynamics of urban economies and essential to understanding the nature of growth in cities. Agglomeration theory needs to say more about how urban agglomeration benefits firms of different types and sizes, and small business and self-employment research needs to say more about the influence of location, in particular cities. How businesses
use both commercial and residential property are integral to the nature of growth in cities.
Agglomeration economies, economic geography, small businesses, Home-based businesses
3199-3217
Houston, D.
90ecba2d-f78e-44d6-a6b6-69693721885c
Reuschke, D.
224493ce-38bc-455d-9341-55f8555e7e13
1 November 2017
Houston, D.
90ecba2d-f78e-44d6-a6b6-69693721885c
Reuschke, D.
224493ce-38bc-455d-9341-55f8555e7e13
Abstract
In developed countries, microbusinesses (those employing fewer than 10 people) and homebased businesses have been systematically overlooked in urban economic development thinking. This article assesses the influence of city location and being run from the business owner’s home on microbusiness growth, based on empirical analysis of panel firm-level data over a four-year
period during the UK’s long boom. The analysis reveals that cities provide benefits to micro businesses for turnover growth but not for employment growth – suggesting that the additional growth induced by cities for microbusinesses may be jobless growth. However, in the case of microbusinesses run from the owner’s home, cities facilitate growth into medium-sized businesses (with 50+ staff). In conclusion, microbusinesses, including those run from business owners’
homes, are integral to the evolution and dynamics of urban economies and essential to understanding the nature of growth in cities. Agglomeration theory needs to say more about how urban agglomeration benefits firms of different types and sizes, and small business and self-employment research needs to say more about the influence of location, in particular cities. How businesses
use both commercial and residential property are integral to the nature of growth in cities.
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Microbusinessesandtheurbaneconomy-authorsfinalversion.docx
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Urban Studies
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Submitted date: April 2016
Accepted/In Press date: 11 August 2016
e-pub ahead of print date: 1 December 2016
Published date: 1 November 2017
Keywords:
Agglomeration economies, economic geography, small businesses, Home-based businesses
Organisations:
Geography & Environment
Identifiers
Local EPrints ID: 395991
URI: http://eprints.soton.ac.uk/id/eprint/395991
ISSN: 0042-0980
PURE UUID: 598c60ad-8905-4af6-9430-d83e45f8ebbc
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Date deposited: 07 Sep 2016 10:10
Last modified: 15 Mar 2024 03:54
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Author:
D. Houston
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