Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling
Understanding the drivers of regional economic growth requires examining the mesoeconomic conditions that influence the ability of small firms to scale. This study investigates how the local composition of firms—by size and sector—along with socio-economic and geographic characteristics, affects the...
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| Format: | Article |
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MDPI AG
2025-05-01
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| Series: | Economies |
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| Online Access: | https://www.mdpi.com/2227-7099/13/5/138 |
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| author | Omar S. López |
| author_facet | Omar S. López |
| author_sort | Omar S. López |
| collection | DOAJ |
| description | Understanding the drivers of regional economic growth requires examining the mesoeconomic conditions that influence the ability of small firms to scale. This study investigates how the local composition of firms—by size and sector—along with socio-economic and geographic characteristics, affects the prevalence of Scaled Firms across U.S. labor market areas. Using cross-sectional data from 2022, the analysis applies a log-linear regression model to examine the relationship between the density of micro, midsize, and large firms and the share of Scaled Firms (defined as employing 5–99 workers) within industry sectors. Covariates include household wealth, educational attainment, unemployment, population diversity, and metropolitan classification. The results show that the presence of midsize and large firms, along with regional human capital and economic context, is significantly associated with higher levels of small firm scaling. These findings suggest that the mesoeconomic context plays an important role in shaping regional economic growth outcomes and that the composition of local firm ecosystems may influence a region’s capacity for resilience and inclusive development. |
| format | Article |
| id | doaj-art-a2657fe45123408097a96ee2ebcf41db |
| institution | Kabale University |
| issn | 2227-7099 |
| language | English |
| publishDate | 2025-05-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj-art-a2657fe45123408097a96ee2ebcf41db2025-08-20T03:47:49ZengMDPI AGEconomies2227-70992025-05-0113513810.3390/economies13050138Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm ScalingOmar S. López0Department of Organization, Workforce, and Leadership Studies, Texas State University, Round Rock, TX 78665, USAUnderstanding the drivers of regional economic growth requires examining the mesoeconomic conditions that influence the ability of small firms to scale. This study investigates how the local composition of firms—by size and sector—along with socio-economic and geographic characteristics, affects the prevalence of Scaled Firms across U.S. labor market areas. Using cross-sectional data from 2022, the analysis applies a log-linear regression model to examine the relationship between the density of micro, midsize, and large firms and the share of Scaled Firms (defined as employing 5–99 workers) within industry sectors. Covariates include household wealth, educational attainment, unemployment, population diversity, and metropolitan classification. The results show that the presence of midsize and large firms, along with regional human capital and economic context, is significantly associated with higher levels of small firm scaling. These findings suggest that the mesoeconomic context plays an important role in shaping regional economic growth outcomes and that the composition of local firm ecosystems may influence a region’s capacity for resilience and inclusive development.https://www.mdpi.com/2227-7099/13/5/138regional economic growthfirm scalingmesoeconomicslabor marketssmall business developmenthuman capital |
| spellingShingle | Omar S. López Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling Economies regional economic growth firm scaling mesoeconomics labor markets small business development human capital |
| title | Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling |
| title_full | Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling |
| title_fullStr | Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling |
| title_full_unstemmed | Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling |
| title_short | Unlocking Regional Economic Growth: How Industry Sector and Mesoeconomic Determinants Influence Small Firm Scaling |
| title_sort | unlocking regional economic growth how industry sector and mesoeconomic determinants influence small firm scaling |
| topic | regional economic growth firm scaling mesoeconomics labor markets small business development human capital |
| url | https://www.mdpi.com/2227-7099/13/5/138 |
| work_keys_str_mv | AT omarslopez unlockingregionaleconomicgrowthhowindustrysectorandmesoeconomicdeterminantsinfluencesmallfirmscaling |