A dual method policy and grassroots approach to creating healthier conditions for small business entrepreneurship in US-Mexico border cities

Abstract

The positive effects of entrepreneurship are linked to healthier business ecosystems, job creation, and innovation. However, most of the top-down entrepreneurship attention is centered around three main high-tech, scalable entrepreneurship hubs: Silicon Valley, New York, and Boston. However, 99% of the United States entrepreneurial ecosystem is composed of small business entrepreneurship. Why then are most of the policy efforts and conversations only surrounding the main hubs? This research advocate for a burgeoning need to focus on areas where the majority of U.S. entrepreneurship occurs. Moreover, The United States and Mexico border boast high levels of small business entrepreneurship. However, their levels of entrepreneurial activity are vastly different. What differentiates entrepreneurial activity in each of these countries? What is limiting the promotion of small business entrepreneurship around the border? Could governmental top-down policy mechanisms play an influential role, if any, in accelerating or promoting entrepreneurial growth to scale border city economies in a similar fashion to the above-mentioned hot spots? Are U.S. policies better or worse suited for this growth? If so, what mechanisms can be replicated so Mexico could follow suit? The foundation of this thesis explores the necessary conditions required to positively influence entrepreneurship. I propose that exploring confounding variables such as physical and commercial infrastructure or access to financial resources are critical to determining what conditions incentivize Latinx entrepreneurship within and between Mexican-American border cities. This thesis uses academic literature and qualitative interview data from small business and startup entrepreneurs on both sides of the US-Mexico border to establish healthy conditions for small business entrepreneurship. These qualitative conditions will then be cross-referenced with government policies and programs available for those same entrepreneurs. Specifically, I look at the moment of launch of an entrepreneur’s business; the resources available to grow their business; and the external conditions that promote or deter their healthy business ecosystem. Though many investors and policymakers assume access to financing and entrepreneurial business education to be the strongest mechanism for success in entrepreneurship, I argue instead that the physical and commercial infrastructure is a significantly more important factor to consider. This exploration into the potential gap in the existing literature could inform policymakers with a more holistic understanding of the needs of an entrepreneur.