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Explaining Entrepreneurial Transience: The Role Of Local Taxation Policy., Jaume Franquesa, Sergey Anokhin, Jino Mwaka

Business Administration Faculty Scholarship

Geographical relocation of ventures, together with rates of firm formation and closure, determine the entrepreneurial population dynamics of a region. However, venture migration has remained largely unaddressed by prior entrepreneurship scholars. This paper draws from theoretical frameworks and prior findings in the economic demography literature to explore policy and environmental determinants of regional venture migration rates, referred to as entrepreneurial transience. Using county-level data for the state of Ohio, we show that local taxation is an important driver of entrepreneurial transience. In particular, local income tax rates are found to be negatively related to subsequent net transience – i.e., venture …