The Spatial Scope of Competition and the Geographical Distribution of Entrepreneurship: Magazine Foundings and the U.S. Post Office

Abstract

Abstract:We propose that the geographic distribution of entrepreneurship evolves as developing communication systems alter the spatial scope of competition Our arguments imply that as spatial barriers to communication diminish founding events will be less sensitive to local context and more sensitive to distant competition. We test this argument with data on the first modern communication system, the US post office, and foundings of organizations that depended on it for distribution: magazine-publishing ventures. We find that as the postal system expanded, the spatial scope of competition among magazines increased: magazines in distant locations exerted more negative effects on local founding rates, whereas magazines in the focal location exerted less positive effects on local founding rates These findings reveal how spatial barriers to competition shape the geography of entrepreneurial activity.

All we want is authentic beer: the role of geographic communities and authenticity on breweries' reactions to competition

“…Beyond their business orientation, such places can become important social and cultural landmarks of a region (Carroll and Torfason, 2011). Under such circumstances, spatial proximity greatly determines the scope of competition facing producers and their responses to it not only because of potential co-location between firms and the subsequent risk of attracting similar customers (Beck, 2008; Haveman and Nonnemaker, 2000; Haveman and Rider, 2014), but also because when firms and customers are geographically proximate to each other, customers will more likely favor firms which manage to play a relevant role within the community and which foster social and cultural interactions.…”