Determinants of new enterprise formation: The Czech Republic (2011-2012)

Abstract

This paper deals with determinants of new enterprise formation in the Czech Republic in the time period 2011-2012. The determinants are analyzed for 227 functional areas delimited according to labor commuting flows. Regression models are computed to reveal the relationship between new enterprise formation and explanatory variables. Final results point out positive impact of spatial concentration of entrepreneurs, high share of foreign firms, the quality of human capital and industrial diversity on new enterprise formation. On the contrary, the presence of large firms is negatively associated with new enterprise formation. The relationship between new enterprise formation on one hand and population density and unemployment on the other is ambivalent.