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Place, sorting effects and barriers to enterprise in deprived areas: different problems or different firms?

Lee, Neil and Cowling, Marc (2012) Place, sorting effects and barriers to enterprise in deprived areas: different problems or different firms? International Small Business Journal . ISSN 1741-2870

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Abstract

Policies to stimulate enterprise in deprived areas typically attempt to remove the specific obstacles faced by firms in deprived locations. Yet there is little evidence that firms in deprived areas actually perceive different problems to those in more affluent places. Alternatively, different types of firms may locate in deprived places. This article uses a sample of 7670 English SMEs to investigate this issue. It asks two questions: Do firms in deprived areas perceive different barriers to success than other firms? And is this because of their location (a ‘place’ effect) or other characteristics (a ‘firm’ effect)? We find only limited evidence that ‘place’ effects are in operation: of nine potential obstacles only a lack of access to finance is significant, controlling for other firm characteristics. However, this finding may be important given that firms in deprived areas are equally likely to be growth orientated.

Item Type: Article
Additional Information: © 2012 The Author(s)
Library of Congress subject classification: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor > HD100 Land Use
H Social Sciences > HN Social history and conditions. Social problems. Social reform
Sets: Departments > Geography and Environment
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 10 Sep 2013 15:52
URL: http://eprints.lse.ac.uk/52366/

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