The spatial impact of entrepreneurial zones: firm, city and inter-city evidence

We investigate the impact of a decade-long large public entrepreneurial infrastructure investment programme in an emerging European economy. Using a unique dataset, we examine the short-run firm, city, and inter-city effects of entrepreneurial zones (EZs). EZs have a positive impact on business investment, sales, and especially the export revenues of firms located within them. The positive economic effects of EZs are limited to host and neighbouring towns and cities, decrease with distance, and eventually become negative. This points to the localised nature of the effects of EZs and their potential for spatial redistribution and clustering of economic activity.