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The present work provides an integrated view of rural entrepreneurship and sets the agenda for future research in the area. Rurality defines a territorially specific entrepreneurial milieu with distinct physical, social and economic characteristics. Location, natural resources and the landscape, social capital, rural governance, business and social networks, as well as information and communication technologies, exert dynamic and complex influences on entrepreneurial activity in rural areas. Rurality is viewed as a dynamic entrepreneurial resource that shapes both opportunities and constraints. Rural entrepreneurship is depicted as a three‐stage sequential process highly influenced by specific territorial characteristics. The proposed research agenda addresses issues related to theoretical studies concerning entrepreneurial processes in rural areas and more applied issues concerning the formulation of integrated and competent policies supporting entrepreneurship in such areas.

Assesses the job creation effects of capital subsidies provided to small and medium enterprises in rural and lagging areas. The proposed methodology takes account of extensive censoring of job creation among assisted rural firms, endogeneity of the capital stock change resultant from capital subsidies, and the extensive part‐time and seasonal job requirements in rural areas. Capital stock change, as a result of grant aid is negatively related to the decision to create new jobs and to the extent of job creation given that some employment is created. Evidence of this work provides the ground for discussing the effectiveness and implications of using capital subsidies as a job creation instrument within rural development policies.