The legacy of the Gold Rush is still evident in entrepreneurship today

The Gold Rush in 19th-century America drew hundreds of thousands of people westward in hopes of finding gold. But it may also have left a much more lasting impact. A new study shows that areas shaped by the Gold Rush have generally had higher levels of entrepreneurship than comparable areas for more than a century.

The researchers examined migration patterns using historical census data from 1850 to 1950 and compared entrepreneurial activity across different regions using data from 1910 onward. One possible explanation for the persistent differences lies with the people who moved westward.

Entrepreneurial people headed west

The gold rush created business opportunities far beyond the mines. As the population grew, there was a need for transportation, trade, hotels, restaurants, and other services. There were ways to make money beyond just finding gold.

But it wasn’t just anyone who was drawn to these areas. Researchers have found evidence that newcomers were more likely to come from regions where self-employment was already common. They were also more likely to work in occupations where many people were self-employed.

The gold rush did not merely mean that more people moved westward. It was particularly attractive to people from communities where entrepreneurship was already well established.

The environment also seems to play a role

It wasn’t just a matter of who moved. The researchers also examined what happened afterward. People who were not entrepreneurs to begin with and who moved to a gold rush area were about 7 percent more likely to later become self-employed than comparable people who moved to other areas.

One possible explanation is the people around them. Where many people run businesses, there are more role models, contacts, and opportunities to learn from others. The researchers also discuss attitudes toward failure. In an environment where many people are trying to start their own businesses, it may be more acceptable to fail, which in turn may make it easier for more people to dare to try.

In this way, migration may have helped to strengthen entrepreneurship even after the first gold rush had ended.

The differences persisted

The effects become apparent much later. According to data from 1910–1950, gold rush areas generally had a higher proportion of self-employed individuals than neighboring areas not affected by the gold rush. This pattern reappears in later analyses of new business formation from the 1970s onward.

The researchers also find clues as to how these differences may have persisted. Today, people in former gold rush areas have, on average, a more entrepreneurial personality profile than people in comparable areas that did not experience a gold rush.

Entrepreneurship is built over time

Researchers cannot determine exactly how migration, culture, and entrepreneurship have influenced one another. Other factors, such as urbanization and industrial development, may also have contributed to these differences.

The results suggest why it can be difficult to quickly create new environments with a strong entrepreneurial spirit. Entrepreneurship in a region is shaped not only by today’s capital, support programs, and infrastructure. It can also be influenced by the people who once moved there—and by the role models, connections, and conditions that have emerged since then.

The gold drew people westward. Entrepreneurship became a legacy that lived on.

More about the article and the authors:
The article “Migrating to a Golden Opportunity: The Gold Rush and the Roots of Persistence of Interregional Differences in Entrepreneurship” ( free to download) is published in the academic journal *Journal of Business Venturing*.

The authors are Michael Stuetzer, Baden-Württemberg Cooperative State University, Germany; Michael Wyrwich, University of Groningen, the Netherlands; Abel Brodeur, University of Ottawa, Canada; Martin Obschonka, University of Amsterdam, the Netherlands; David B. Audretsch, Indiana University, USA, and Austria; Peter J. Rentfrow, University of Cambridge, the United Kingdom; Jeff Potter, Atof Inc., USA; and Samuel D. Gosling, University of Texas at Austin, USA.