Return-to-hometown entrepreneurship and employment of low-income households: Evidence from national returned entrepreneurial enterprise data of China

Abstract

Employment is widely regarded as the most effective approach for eradicating poverty among low-income groups and preventing them from returning to poverty. Using national returned entrepreneurial enterprise data of China, this study empirically analyzes how “return-to-hometown entrepreneurship (RHE)” achieves antipoverty through a mediation effect model that incorporates moderating effects. Our findings reveal that: (1) RHE considerably enhances employment in low-income households. In particular, annual income and enterprise investment scale have a substantial positive impact on boosting the employment of low-income households. (2) Development- and value-oriented enterprises boost employment of low-income households more than survival-oriented enterprises. (3) The mechanism analysis indicates that entrepreneurship training plays a positive moderating role between the income of enterprises and the number of employed low-income households. Tax relief, loan guarantees, and industrial support policies have played multimediating roles in achieving antipoverty by RHE. These findings indicate that an effective interface between poverty alleviation and rural revitalization requires the government to attract additional high-quality RHE enterprises and actively fulfill its important institutional role in entrepreneurial training and various return-to-hometown entrepreneurial support policies.