Take-up and variation of advice for new firm founders in different local contexts

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Abstract

© 2017, © The Author(s) 2017. Although business advice has been linked to entrepreneurial outcomes, it is subject to information asymmetries and market failure. We argue that the knowledge concerning from whom to take advice before starting a new firm is more easily accessed in areas with high start-up rates which therefore ameliorates market failure. The study is based on surveys of 599 new firm founders in England and 381 new firm founders in Catalonia. A series of probit and heteroskedastic probit models are employed to investigate not only the probability of taking advice but also the variance in that probability, which reflects uncertainty. Supporting our view, the findings show that the taking of advice in the places with higher start-up rates exhibit less variation compared to other localities. We also find differing effects of place on the take up and variation of private sector and public sector advice. Implications from the findings are discussed.
Original languageEnglish
Pages (from-to)3-27
JournalEnvironment and Planning C: Politics and Space
Volume36
Issue number1
DOIs
Publication statusPublished - 1 Feb 2018

Keywords

  • Advice
  • business support
  • enterprise policy
  • new firm founders

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