Support and development of small and new firms in rural areas: a case study of three regional initiatives

Abstract

This paper is based on qualitative analysis and addresses the important topic of small business entrepreneurialism in rural areas and its special conditions and needs. Our aim is to present examples of and suggestions for how to encourage firm start-ups and the continuation possibly also the development and growth of existing firms. The paper is based on three cases that illustrate (1) challenges in the support system in rural areas, (2) various forms of support that could be used in rural areas, and (3) expectations that are eligible to put upon support activities designed for rural areas. The main findings are that (1) that successful support of rural businesses requires a critical mass of regional entrepreneurs, firms, and support actors, (2) diversity is critical, and the various actors must be coordinated to carry out the desired measures effectively, (3) expectations for growth and orientation of the firms must be realistic because broad support is more important than targeted support, and (4) we were able to show that a cross-boundary collaborative work culture that avoids both thought silos and business silos and places no value on prestige should pervade all areas of business support.

Ukrainian State Regional Development Fund: Current Realities, Opportunities

“…In particular, T. Talitha , T. Firman and D. Hudalah discovered decentralization in Indonesia [1]; J. Jia, G. Ma, C. Qin and L. Wang -place-based policies in China [2]; N. Matteucci -digital agendas, regional policy and institutional quality the Italian broadband plan [3]; N. Surubaru -the impact of European aid on national and local development in Bulgaria and Romania [4]; F. Silvestri, and F. Spigarelli and M. Tassinari analyzed regional development of circular economy in the European Union [5]. By this time, E. Merkaj, R. Lucchetti and F. Fiorillo underlined the role of local leaders in regional development funding [6], M. Klofsten , C. Norrman, E. Cadorin and H. Löfsten studied three regional initiatives of the support and development of small and new firms in rural areas [7]; N. Henry and A. Smith evaluated the post-brexit urban and regional development futures [8]; N. Moşteanu discovered green sustainable regional development and digital era [9]; K. Malik, L. Mach, M. Szewczuk-Stepien and P. Bebenek discussed specialization integrated strategy of innovations as an effective model for emerging regional economy development [10]; B. Asheim looked for the new path development in less innovative regions in smart specialization, innovation policy, and regional innovation systems [11]; M. Grillitsch and M. Sotarauta searched the trinity of change agency, regional development paths and opportunity spaces [12]. Finally, U. Andrusiv, L. Simkiv, O. Dovgal, N. Demchuk, N. Potryvaieva, A. Cherchata, I. Popadynets, G. Tkachenko, O. Serhieieva and H. Sydor made an analysis of the economic development of Ukraine regions based on the taxonomy method [13]; Y. Uzun, and S. Koch compared the scenarios of Regional Development of Ukraine in the Context of Internal Stability Establishment [14]; M.Getzner, and S. Moroz studied the case for regional development and foreign direct investment in Ukraine [15].…”

Authorities as Enablers in Rural Business Support Policy Regime – Case‐Study Finland

“…Rural enterprises often need development agencies, or intermediaries linking the entrepreneurial initiatives to rural authorities that support business activities (Smallbone et al 2003;OECD 2014, pp. 95-112;Klofsten et al 2019). Accordingly, rural authorities are expected to make specific efforts to catalyse entrepreneurship in rural regions and it should be expected that these efforts would be fully exploited (North and Smallbone 2006).…”

“…95–112; Klofsten et al . 2019). Accordingly, rural authorities are expected to make specific efforts to catalyse entrepreneurship in rural regions and it should be expected that these efforts would be fully exploited (North and Smallbone 2006).…”

“…Similarly, it has also been claimed that entrepreneurs’ reluctance to apply support may stem from a problematic relationship between the policymakers and entrepreneurs (e.g., Niska and Vesala 2013; Klofsten et al . 2019). Accordingly, previous research has suggested that the role of authorities in the business support is crucial, but calls for more elaboration since their actions in the business support have received little attention (Pyysiäinen and Vesala 2013).…”

“…The excessive bureaucracy has been acknowledged as one explanation that hinders entrepreneurs' interest in business development measures (North and Smallbone 2006;Niska and Vesala 2013;Stępień and Czyżewski 2016;Kujala 2019). Similarly, it has also been claimed that entrepreneurs' reluctance to apply support may stem from a problematic relationship between the policymakers and entrepreneurs (e.g., Niska and Vesala 2013;Klofsten et al 2019). Accordingly, previous research has suggested that the role of authorities in the business support is crucial, but calls for more elaboration since their actions in the business support have received little attention (Pyysiäinen and Vesala 2013).…”