Policy Options for Equity Financing for Rural Entrepreneurs, Main Streets of Tomorrow: Growing and Financing Rural Entrepreneurs
نویسنده
چکیده
limited access to financing from venture capitalists. Of this situation, there is widespread evidence and agreement. There is not, however, agreement as to the principal reasons why entrepreneurs in rural areas have difficulty in acquiring equity capital for new business start-ups and expansions. On the one hand, some suggest (e.g., Florida and Kenney, 1988) that few venture capital investments are made in rural areas because relatively few rural businesses are in the sectors favored by venture capitalists (e.g., software, telecommunications, and biotechnology). On the other hand, others propose that market imperfections (e.g., the high information and transactions costs associated with rural investments) result in a lack of capital availability for promising rural businesses in the “right” industries (Freshwater and others, 2001; Rubel and Palladino, 2000). These alternative perspectives on rural equity markets provide negative reinforcements for one another. For example, a recent analysis of the South Carolina economic environment noted:
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Entrepreneurship in Rural America: The Big Picture, Main Streets of Tomorrow: Growing and Financing Rural Entrepreneurs
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