Abstract

covid -19 pandemic is having a huge impact on national economies. Although many studies have focused on the consequences at the macroeconomic level, especially in terms of forecasts and long-term repercussions, few have investigated the effects on entrepreneurship. The impact of lockdown on the economy represents a novel field of research, which has yet to be addressed in depth in the entrepreneurship literature. Our focus is on Italy, which experienced a strong decrease in the number of startups during the two months of lockdown. This paper aims to test whether there has been a geographical effect of covid -19 on the decline of startups through an econometric analysis at the provincial level. Controlling for several local socio-economic features, we found a high significant effect of the spread of covid -19 on the decrease in startups, but not on the level of firms closures. Moreover, the results show also that the reduction in startup activity occurred especially in the more competitive provinces, in terms of R&D expenditure and economic growth before the outbreak of the pandemic.