The Impacts Entrepreneurship has on Economic Growth in Georgia, New Mexico, Kentucky Counties

Abstract

The study is primary analyzing the impacts that entrepreneurship have on economic growth in Georgia, New Mexico and Kentucky counties between 2010 and 2012. The three states form 313 counties altogether. Economic growth in a given county can be measured by looking at the growth rate of personal per capita income, and the eight control variables include education, government spending, per capita income, unemployment, white population, rural dummy and farm dummy variable. The variables of interest are firm, establishments and employment at all sizes less than 500, which composed 15 models in terms of different firm, establishment and employment sizes. The results of this study present clear relationships between the control variables and economic growth. Farm-based counties and personal per capita income are positively related to economic growth; while government spending and population density are inversely related to economic growth. These coefficients of the variables are statistically significant and robust to all models. The coefficients for rest of the variables are not statistically significant, which means that they cannot be used to explain the economic growth in the specific period of this study.