The Knowledge Economy and Entrepreneurial Activities in Technology-Based Economic Development.

Regions compete to bring wealth creation and high-paying jobs to their constituents through the creation of small start-ups. Different authors identify different factors that influence this activity leaving policy makers wondering about the right set of ingredients. These factors include many that are affected by the knowledge economy. To identify the essential ingredients, we studied 361 Metropolitan Statistical Areas in the USA. We examined factors such as capital, education, engineering and science degrees, top business school presence, presence of other medium and large companies in the area, the number of incubators, high speed internet connectivity, creativity, population size, cluster formation, and the available workforce to assess their contribution to the creation of new businesses in nontech as well as high tech. Statistical tests indicate that factors such as, in further tests, technology maturation activities such as research, venture funding, and telecommunications infrastructure, were found to be important for technology startups. Attraction and creation of medium and large sized businesses helped the small start-ups in creating markets for their products. [ABSTRACT FROM AUTHOR]