How Does Your State Rank for Entrepreneurship?

New York is at the top of the list; South Carolina is at the bottom.

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New York was tops in the nation for entrepreneurial activity, according to a new report.

The 2010 State Entrepreneurship Index—developed by economists at the University of Nebraska-Lincoln—evaluates a state's percentage growth and per capita growth in business establishments, its business formation rate, the number of patents per thousand residents, and the gross receipts of sole proprietorships and partnerships per capita. States are ranked based on their performance compared to the nationwide average.

Rounding out the top five after New York were Washington, Massachusetts, New Jersey, and Oregon. (New York held on to the top spot from 2008, the last time the index was compiled, thanks to "strong performance in gross receipts per capita and substantial improvement in other two components, growth in employer establishments and establishments per capita," according to the Entrepreneurship in Nebraska report.)

Oregon got the Most Improved award, leaping 40 spots from the last index, thanks to growth in numbers of businesses and businesses per capita. Delaware was another big mover, leaping 28 spots to No. 14, as was Kentucky, up to No. 24  from its spot as No. 50 in the 2008 index.

The worst states for entrepreneurship? South Carolina was at the bottom, with Arizona, Mississippi, Nevada, and Alabama. Nevada fell the most, down 40 positions. Arkansas fell 26 spots, to No. 36.

Inc. contributing editor Courtney Rubin was for five years a London-based staff writer for People magazine. Rubin, a former senior writer for Washingtonian magazine, has written for the New York Times magazine, Time, Marie Claire, and other publications. She is the author of The Weight-Loss Diaries.