Agglomeration theory is focused on large firms and why they cluster in cities. Economic theory thus far has very little to say about small businesses, their location choices and growth. This paper is original in that it seeks to fill this research gap through empirically investigating how small businesses – including those that are based in the owners’ homes – grow in agglomerations and whether small businesses can overcome their smallness disadvantage only in cities. This is the first paper that uses robust data to investigate the growth of non-employer businesses into employer businesses in cities in comparison with areas outside cities. Unique longitudinal business data are used and ‘real’ business growth measured. The findings reveal that city economies facilitate the growth of home grown businesses and that small businesses are an essential part of city economies.

This paper provides a new perspective on the role of housing in economic geography and thus advances knowledge of the interrelationship between housing and economic systems. It shows, for the first time, how people’s housing choices are shaping their decision to become self-employed and that home-based self-employment has distinct features. Different mechanisms how housing can influence people’s self-employment decisions are theoretically derived and tested using longitudinal microdata for the UK. In particular, and advancing existing empirical studies, it controls for endogeneity of housing to self-employment using a novel technique from health research.

This paper makes two novel contributions to economic geography and planning. First, it studies microbusinesses (those employing less than ten staff) including those that are based in the owner’s home which have been ignored in developed country contexts. Second, it links hitherto disconnected literatures in economic geography/ management and urban/neighbourhood studies and develops a concept of local resources for microbusinesses. It explores empirically the relevance of local resources for microbusinesses over the business cycle which have been overlooked in existing literatures. It uses a random sample of microbusinesses that includes informal (hidden) businesses. It enhances the dataset through data linkage with small-area census data.

Working Papers and Thinkpieces

Microbusinesses (those that employ less than 10 people) represent a significant proportion of the economy. However, microbusinesses have been neglected in urban economic research and policy, which have focussed more on flagship investments and large firms. This working paper summarises own empirical work on microbusiness growth and locational requirements of microbusinesses including those that are based in the owners home.

  • Wilkins, A. (2017) Profiles of Coworking Networks in Homes and Neighbourhoods in the UK, France and Sweden. ERC WORKANDHOME. University of Southampton. Coworking research profiles

This working paper examines coworking in homes and neighbourhoods in the UK, France and Sweden. It draws upon qualitative research on coworking that takes place in people’s homes, including Hoffice (Stockholm) and Cohome (Paris), as well as coworking that takes place in public spaces including cafes, community and leisure centres (Wimborne, Somerford and Winchester Jellies). The paper examines the background, organisation structure, location and users of each network, and provides information on the activities that take place as part of coworking in each case. Photographs taken by the researcher and participants are also included to visually document the coworking spaces and activities. This working paper forms part of the ERC WORKANDHOME project, which examines the economic, social and spatial drivers of home-based business.