Topic: Economics
The 2011 State Entrepreneurship rankings have arrived fresh from the University of Nebraska. Like so many other state comparisons, this one has its flaws. The recent spate of patent wars between corporations dueling for litigation rights skews the results with Oregon jumping from 45th to fifth with no real increase in that state's entrepreneurship involved.
Neither does the study help the reader understand the complex relationship between entrepreneurship and downturns in the general economy. In North Dakota for example, the comparisons do not reflect the entrepreneurship borne of necessity after the massive layoffs experienced recently in other states. The rankings don't always account for such fine points.
The rankings also tend to promote entrepreneurship as an economic panacea akin to improved innovation or productivity gains. This would be fine, except that so many fledgling entrepreneurs must settle for a decrease in personal income when they become their own bosses.
The greatest gains to the economy come from businesses growing out of the sole owner and operator mode into an organization of three or more employees. The rankings reveal little as to how well a state does in helping businesses achieve this important transition. A bit more attention to detail, statistical outliers and important disclaimer notes will have to appear with these rankings before this reader puts much stock in the University of Nebraska findings.
