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April 14, 2009

Where the U.S. is still number 1

There's a lot of negativity during recessions. At the same time, there's a feeling that the U.S. has lost its lead in many economic measures. But there's one area where the U.S. is still number 1. What is it?

Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"It's what economists call entrepreneurship, or the creation of new businesses. There's no country in the world where people can come and take risks to start a new business, hire people and grow those businesses like the U.S. We are by far and away the leader in entrepreneurship. And I think there are several reason for that. First of all, U.S. companies have a lot of freedom, much more compared to other countries, to, for example, hire and fire workers. The U.S. has the most mature venture capital sector. Venture capital is simply a fancy term for investors who want to invest money in business start-ups. Thirdly, we have a very unusual and very close relationship in this country between universities and industry. There's a lot of interplay, where industry can tap into inventions and new ways of thinking at universities. Universities are not ivory towers, sitting out there by themselves. In a lot of countries, they are. That, we think, helps spur this entrepreneurship. And then, lastly, very controversial, but, I think, a factor, is we have a relatively open immigration policy, and immigrants have historically been a big source of many small business starts."

Posted by Dave at April 14, 2009 08:00 AM