Regional opportunities and policy initiatives for new venture creation

Purpose – Investigates the determinants of new venture creation across industries and locations in Italy. Design/methodology/approach – Reviews previous studies into regional new firm formation, and discusses regional opportunities for new venture creation in Italy with a particular focus on the effects of the Italian regional laws aimed at promoting new firm formation. Considers the determinants new venture creation in Italy, taking into account the effect of local demand, labor productivity, wages and start-up costs, welfare growth, tourism and city size. Analyses data on new business registrations for all 103 Italian provinces between 1997 and 2003. Findings – Discovers that: regional wage costs limit entry, while provinces with industrial districts achieve higher start-up rates in manufacturing; for the retail and wholesale sector, attention is paid to city size and regional economic welfare and growth; for hotels and restaurants, the relative number of tourists significantly influences new firm formation; and there is no significant effect of recently introduced laws on firm entry rates across any industry. Indicates that regional policies targeting entrepreneurship do not necessarily yield positive results. Research limitations/implications – Has no stated implications for future research. Contributes to the new ventures literature with an examination of the determinants of start-ups for 103 Italian provinces over the period 1997 to 2003, testing for the effect of regional and national policies on new venture creation.Article type: Research paperISSN: 0266-2426Reference: 39AA342