Endogenous Growth Through Knowledge Spillovers in Entrepreneurship: An Empirical Test

Endogenous growth theory suggests that technological knowledge stimulates growth, yet the micro-foundations of this process remain obscure. Knowledge spillover theory posits that growth is contingent on the technology dependence of industries, forming the landscape for entrepreneurs to launch and grow ventures. We investigate these theoretical contingencies with two research questions using comprehensive employee-employer data documenting the science and technology labor force in Sweden. First, do industries with a greater need for new technology-based entrepreneurship grow disproportionately faster than other industries? Second, are the knowledge spillover effects fostering the growth of new technology-based firms contingent on certain industry structures?