46th Congress of the European Regional Science Association: "Enlargement, Southern Europe and the Mediterranean", August 30th - September 3rd, 2006, Volos, Greece
Entrepreneurship is crucial to a vital and thriving economy, even on the neighbourhood level. This fits into current urban planning policy in the Netherlands, which aims at combining housing and economic functions within neighborhoods. Since an increasing number of entrepreneurs start from home, this calls for insight in the combination of work and home. However, there is limited knowledge about the specific role of the dwelling in the decision to start a firm from home and to stay put. This explorative paper focuses on the use of the dwelling as location of a firm, both in the start-up phase and beyond in the firm life course, and its explanations. Our research questions are: what determines the decision to start a firm within the dwelling of the entrepreneur and its duration in time, and how does this relate to the propensity and decision to move? In our empirical analyses a combination of quantitative and qualitative research methods is used. We analyzed data from 130 questionnaires send out in April 2005 to young entrepreneurs who owned a firm in two Dutch urban neighborhoods. These questionnaires were followed by in-depth interviews with 10 entrepreneurs. We have found that most home based businesses did start from home and are strongly tied to the dwelling - and therefore the neighbourhood. Both firms with past growth in number of personnel and firms with growth aspirations do want to move relatively often. With respect to firm relocation and the personal propensity to move, housing characteristics as adapted dwellings, and owner-occupied, single family and large houses are important. With respect to future home-based business, to most firms breaking the work-home combination is not a realistic option. Household characteristics and more specifically the care of small children keeps entrepreneurs home-based. Also entrepreneurs who work almost full-time are relatively strong attached to their home, which may point to an explicit -and maybe also longlasting- choice for home-basedness. Economic policy should therefore foster start-ups within urban neighbourhoods, as many of them seem to be firmly anchored locally by attachment to their home.