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19 - Finance and Innovation Policies

from Part IV - Public Policy

Published online by Cambridge University Press:  16 March 2018

Simon C. Parker
Affiliation:
University of Western Ontario
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Summary

The present chapter focuses on an important set of entrepreneurship policies dedicated to promoting entrepreneurial finance and innovation. Previous chapters have explained why free markets may generate insufficient amounts of both of these goods: a set of policies to correct for these deficiencies are analyzed theoretically before evidence is brought to bear on their effectiveness and impact. These policies include loan guarantee schemes designed to unlock bank credit to entrepreneurs who lack collateral; grants and subsidies to talented but credit-constrained entrepreneurs; and regulatory and taxation policies designed to stimulate the market for equity finance. The chapter then turns its attention to innovation policies, including policies encouraging the commercialization of academic research; the protection of intellectual property rights; R&D spending; and political leadership. Lessons are drawn at the end of the chapter about which entrepreneurial finance and innovation policies work well, and which work less well.
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Publisher: Cambridge University Press
Print publication year: 2018

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