What Is the Relationship Between Economic Freedom, Education, & Economic Development

Venture capital and the start of new business ventures are considered a driving force in developing technologies and are regarded as a significant indicator of regional economic development. The purpose of this research is twofold. First, it seeks to extend the investigation by Florida and Smith (1993), who developed statistical models for both the location and supply of venture capital funding across regions in the U.S., including their link to creative activities (nontraditional source of innovation). Second, it explores educational variables not previously studied that are used to further our understanding of the spatial location and availability of venture capital and new business start-ups by exploring economic development activity and the link to microeconomic freedom variables. We tested and found evidence demonstrating the significance of graduate education level and economic freedom in driving economic development (Venture Capital activity) using 2006-2019 data made available by U.S. Bureau of Labor Statistics, U.S. Census Bureau, Fraser Institute, National Venture Capital Association, and Federal Reserve Bank of Minneapolis.