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New business creation and regional development: Enhancing resource acquisition in areas of social deprivation

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  • Dilani Jayawarna
  • Oswald Jones
  • Allan Macpherson

Abstract

Over 7 years, the UK-Government funded an entrepreneurship scholarship scheme in the most deprived regions of England. This study examines how, for 211 of these nascent entrepreneurs, bootstrapping compensated for their inability to obtain debt or equity funding. Results show that social capital (strong, weak and brokerage ties) is important for access to bootstrapped resources. While human capital, including previous business experience and financial skills, are linked to joint-utilisation approaches to bootstrapping, higher financial investment is linked to owner- and payment-related approaches. A key outcome for developing appropriate regional policy is that ‘brokers’ provide a link between socially disadvantaged entrepreneurs and external resources.

Suggested Citation

  • Dilani Jayawarna & Oswald Jones & Allan Macpherson, 2011. "New business creation and regional development: Enhancing resource acquisition in areas of social deprivation," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 23(9-10), pages 735-761, December.
    • Handle: RePEc:taf:entreg:v:23:y:2011:i:9-10:p:735-761
    DOI: 10.1080/08985626.2010.520337
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    References listed on IDEAS

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    1. Chandler, Alfred D., 1990. "Scale and Scope: A Review Colloquium - Scale and Scope: The Dynamics of Industrial Capitalism. By Alfred D. ChandlerJr., with Takashi Hikino · Cambridge, Mass.: Harvard University Press, 1990. xix + 8," Business History Review, Cambridge University Press, vol. 64(4), pages 690-735, January.
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    1. Rajennd A/L Muniady & Abdullah Al Mamun & Mohd. Rosli Mohamad & P. Yukthamarani Permarupan & Noor Raihani Binti Zainol, 2015. "The Effect of Cognitive and Relational Social Capital on Structural Social Capital and Micro-Enterprise Performance," SAGE Open, , vol. 5(4), pages 21582440156, October.
    2. Miao, Chao & Rutherford, Matthew W. & Pollack, Jeffrey M., 2017. "An exploratory meta-analysis of the nomological network of bootstrapping in SMEs," Journal of Business Venturing Insights, Elsevier, vol. 8(C), pages 1-8.
    3. Ratinho, Tiago & Amezcua, Alejandro & Honig, Benson & Zeng, Zhaocheng, 2020. "Supporting entrepreneurs: A systematic review of literature and an agenda for research," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    4. Daniel Ratzinger & Kevin Amess & Andrew Greenman & Simon Mosey, 2018. "The impact of digital start-up founders’ higher education on reaching equity investment milestones," The Journal of Technology Transfer, Springer, vol. 43(3), pages 760-778, June.
    5. Matthias Piontek & Michael Wyrwich, 2017. "The emergence of entrepreneurial ideas at universities in times of demographic change: evidence from Germany [Die Entstehung von Gründungsideen und neuen Unternehmen in Zeiten demografischen Wandel," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 37(1), pages 1-37, February.
    6. García-Villaverde, Pedro M. & Rodrigo-Alarcón, Job & Parra-Requena, Gloria & Ruiz-Ortega, María José, 2018. "Technological dynamism and entrepreneurial orientation: The heterogeneous effects of social capital," Journal of Business Research, Elsevier, vol. 83(C), pages 51-64.
    7. Jozef Habanik & Petr Novak & Jaroslav Belas & Eva Cipovova, 2014. "Actual Trends in Business Risks for Small and Medium Enterprises. Case Studies from the Czech Republic and Slovakia," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 159-181.
    8. Eduardo Sánchez-García & Bartolomé Marco-Lajara & Pedro Seva-Larrosa & Javier Martínez-Falcó, 2022. "Driving Innovation by Managing Entrepreneurial Orientation, Cooperation and Learning for the Sustainability of Companies in the Energy Sector," Sustainability, MDPI, vol. 14(24), pages 1-17, December.
    9. Manuela Natário & Ascensao Braga & Goncalo Poeta Fernades, 2015. "El emprendimiento en Regiones Fronterizas: Estudio de cuatro municipios de la BIN," Revista de Estudios Regionales, Universidades Públicas de Andalucía, vol. 3, pages 83-109.
    10. Jayawarna, Dilani & Jones, Oswald & Marlow, Susan, 2015. "The influence of gender upon social networks and bootstrapping behaviours," Scandinavian Journal of Management, Elsevier, vol. 31(3), pages 316-329.
    11. Job Rodrigo-Alarcón & Gloria Parra-Requena & María José Ruiz-Ortega, 2020. "Cognitive social capital and absorptive capacity as antecedents of entrepreneurial orientation: a configurational approach," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 10(4), pages 493-517, December.

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