What Makes a City Entrepreneurial?

This is the subject of a recent policy brief by Ed Glaeser and William Kerr.  Published by the Rappaport Institute/Taubman Center, the brief links entrepreneurship and regional economic growth.  And to encourage entrepreneurship, the authors have four pieces of advice for urban leaders:

(1) Investing too much in attracting large, mature firms may not be good policy.

(2) There is little reason to have much faith in the ability of local governments to play venture capitalist. The best role for government is simply to encourage competition among local banks and financiers.

(3) There is much to be said for the strategy of focusing on the quality of life policies that can attract smart, entrepreneurial people.  The best economic development strategy may be to attract smart people and get out of their way.

(4) Good universities have faculty members who are involved in local start-ups and train students who may become entrepreneurs and the employees of entrepreneurs.  Imposing costs that restrict the growth of such institutions can be costly.

The prize quote from the brief:  "What community ever screwed up by providing too much quality of life?"  That ought to become the guiding principle of every city.

  

buendia, April 8, 2010

I think Portland, Oregon is a good example of a city that has invested heavily in quality of life measures, but has not succeeded in attracting "smart, entrepreneurial" people. The city, while a great place to live, has a less than stellar, and uninspiring economic landscape and outlook.

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