Insights from research at HEC Lausanne – Many governments currently provide financial support for startups that want to launch themselves into the adventure of entrepreneurship. Subsidies for R&D are a common example. But recent research by Professor Annamaria Conti at HEC Lausanne (UNIL) shows that budding businesses may well turn away from financial support, depending on the policy that underpins it.
As a country of successful start-ups, Israel was the ideal location for the study carried out by Prof. Conti. With a population of barely 8.5 million, Israel has the highest number of startups in the world, with one for every 1,400 inhabitants.
Despite this, it has taken policymakers several attempts to find the right approach for supporting business creation. Initially, the government applied a policy of subsidies combined with restrictions on transferring know-how, fearing that its investment would be siphoned off to other countries.
What was the impact on the most promising start-ups? Should the policymakers better incentivize or sanction? What are the most effective financial support policies for both startups and the country’s economy?
Find the answers in the article by Prof. Annamaria Conti published on HEC Lausanne’s research blog, HECimpact.
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