Productive knowledge, scaling, enterprise richness and poverty in a group of small U.S. counties

Abstract

The socioeconomic and entrepreneurial characteristics of a group of 68 small (fewer than 120000 persons) U.S. counties exhibit extensive orderliness. There is a geographically-insensitive log-log (power law) relationship between the number of enterprises and enterprise richness (the number of enterprise types) in the counties. Enterprise richness is used as a proxy for productive knowledge, i.e., the explicit and tacit knowledge to produce and deliver things and services. Enterprise richness quantifies the number of times a new business idea is successfully introduced. The numbers of population, enterprises, employees in enterprises, total county employees, and higher-educated persons all scale super-linearly in relation to levels of productive knowledge. Thus, there are significant agglomeration effects associated with increases/decreases of productive knowledge. The ratios between two entrepreneurial types i.e., new and existing entrepreneurs, have been quantified in relation to the size of the counties. Smaller counties have a greater need for new entrepreneurs than for existing entrepreneurs, and the opposite is the case for larger counties. The notion that the level of poverty is related to the level of productive knowledge in countries, led to exploration of the relationship of various characteristics to poverty levels in the selected counties. Poverty is an important moderating factor in the entrepreneurial wellbeing of the 68 counties. The demographic-socioeconomic-entrepreneurial nexus of U.S. counties deserves further research attention.

Keywords:

• power laws
• scaling
• enterprise richness
• business diversity
• enterprise dynamics
• productive knowledge
• poverty
• U. S. counties
• human settlements

PUBLIC INTEREST STATEMENT

Concerns about distressed communities in the U.S., requires investigation of the potential presence of statistically significant log-log (power law) relationships between their demographic, socioeconomic and entrepreneurial characteristics. Publicly-available data sets of a group of 68 smaller U.S. counties (fewer than 120000 residents) have been used to address this issue. Power laws are present and scaling based on population numbers and on levels of productive knowledge (i.e. the ability to successfully start enterprises of types not previously present) is a common feature. Counties with more productive knowledge have disproportionately fewer enterprises but also disproportionately more people, more employees, more people with higher degrees and also more officially poor people. Smaller counties face different development challenges than larger counties. The possibility that these findings could be generally true for U.S. counties, indicates that more of this type of research is needed to enhance efforts to assist distressed communities.

Acknowledgements

The Centre for Environmental Management, University of the Free State, provided administrative and research support. Alumnus services of the Massachusetts Institute of Technology provided online scholarly journal access.

Additional information

Funding

The author received no direct funding for this research.

Notes on contributors

Danie Francois Toerien

Danie Francois Toerien The past decade has been dedicated to studies of the enterprise structures and their relationships with demographic and socioeconomic characteristics of South African towns. Inordinate orderliness was detected, expressed in many different regularities/proportionalities. In particular, an enduring and geographically insensitive log-log (power law) relationship was detected between the total number of enterprises and the number of different enterprise types. This relationship, which has been used as a proxy for productive knowledge (i.e. the ability to successfully start enterprises of types not yet present), has provided a platform for investigations of the nexus between demographic, socioeconomic and entrepreneurial characteristics and has yielded much predictability. This research was extended to the demographic, socioeconomic and entrepreneurial domains of smaller (<120000 people) counties of the U.S., a developed country. This study reveals that a seemingly geographically insensitive log-log relationship is present and could well be characteristic of all smaller human settlements in the U.S.