A new study conducted by researchers at Butler University, in collaboration with the Institute for Entrepreneurial Communities, offers new insight into the forces behind Elkhart County’s sustained economic growth—highlighting the power of a diverse and interconnected entrepreneurial community. 

By many measures, Elkhart County stands out as a regional success story. According to the U.S. Bureau of Economic Analysis, income per capita reached $58,662 in 2023, while poverty rates have declined over the past decade. While these indicators point to improving economic well-being and quality of life, the study moves beyond surface-level metrics to examine the underlying drivers of this progress. 

The findings suggest that Elkhart County’s success cannot be attributed to a single factor. Instead, prosperity appears to emerge from the coexistence and interaction of multiple types of entrepreneurial firms operating within the same region. 

The research adopts a comprehensive definition of entrepreneurship—one that extends beyond startups to include established firms that pursue opportunity through innovation, industry clusters and specialization, international engagement, and community impact. 

Among the study’s key insights: 

• Innovation-driven firms expand the technological frontier through patenting and startup activity, boosting productivity, employment, and regional resilience to economic disruption. 
• Industry clusters, particularly in recreational vehicles and advanced manufacturing, benefit from geographic proximity, shared labor markets, and specialized suppliers that strengthen competitiveness. 
• Exporting firms connect regions to global supply chains, introducing new technologies and practices while expanding opportunity beyond local demand. 
• Impact-oriented nonprofits support workforce development and community institutions, helping ensure economic growth translates into broader well-being. 

Each of these dimensions plays an important role. However, the study’s central conclusion is that regions do not thrive because of any one type of firm. They thrive because different forms of entrepreneurial activity reinforce one another. 

“Too often, communities search for a one-size-fits-all explanation for economic success,” Stephanie Fernhaber, Butler University Professor of Entrepreneurship & Innovation, said. “Our findings suggest that long-term prosperity emerges from specific configurations of entrepreneurial activity, and more than one configuration can produce similarly strong outcomes if it fits a region’s underlying strengths.” 

The research team from Butler University’s Lacy School of Business included Fernhaber, Hessam Sarooghi, Associate Professor of Entrepreneurship and Innovation, and Marleen McCormick Pritchard, Associate Professor of International Business and Strategy. Using data from all U.S. counties between 2014 and 2020, the researchers analyzed how combinations of innovation activity, exporting, industry specialization, and nonprofit capacity relate to economic well-being across rural, small metro, and large metro regions.

Rather than prescribing a single “right” development strategy, the study identifies multiple viable pathways associated with economic success. For Elkhart County, the findings most strongly align with a model centered on manufacturing-based industry clusters, high levels of exporting, and patent activity. Nonprofits also play a supporting role within certain pathways. Elkhart County has five industry clusters, of which the most recognized is the RV industry. Notably, Elkhart’s startup rate is lower than the small metropolitan average, suggesting that its economic strength is driven more by established, innovation-oriented firms than by high startup intensity alone. 

This integrated approach provides evidence-based insight into how existing strengths can be aligned more intentionally and how peer regions with similar profiles may serve as benchmarks for learning and collaboration. 

“Understanding regional economic success requires moving beyond isolated explanations,” the report concludes. “Long-term prosperity depends on how innovation activity, international engagement, industry specialization, and community capacity interact within a community.” 

The study offers practical implications for policymakers, business leaders, and nonprofit organizations. By recognizing the interconnected nature of entrepreneurial activity, communities can design development strategies that leverage complementary strengths rather than relying on a single sector or initiative. 

“What makes this research powerful is that it defines how communities are successful through a combination of factors that move beyond theory and speaks directly to what communities can do,” Liz Borger, Chief Strategic Advisor, Institute for Entrepreneurial Communities, said. “Elkhart County demonstrates that growth is strongest when businesses, nonprofits, and institutions operate as part of a connected system. That insight gives community leaders a practical framework for sustaining entrepreneurial momentum.” 

For Elkhart County, the findings affirm the value of sustaining innovation, supporting industry clusters, expanding global engagement, and investing in community institutions as mutually reinforcing drivers of economic well-being.