Entrepreneurship and New Venture Creation: An Analysis of Italian Provinces

This paper presents an empirical analysis of Italian provinces focusing on two aspects: (i) the relationship between initial entrepreneurial density and new venture creation; and (ii) the sectors of activity in which new ventures operate and, more precisely, the relationship between the initial industrial specialization of each province and the distribution of the province’s start ups among different industries. By taking into consideration the overall start up and net entry rates (regardless of sectors of activity), we observe no evidence of a relationship between the local concentration of entrepreneurial initiatives and new venture creation. On the other hand, data disaggregated per sector of activity show that in the large majority of Italian provinces new ventures tend to be relatively more concentrated in the same sectors than incumbent ventures, and this tendency turns out to be more accentuated in provinces characterized by higher entrepreneurial density.