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Improved Framework Conditions for a More Entrepreneurial, Innovative and Resilient EU

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Abstract
In the wake of the Covid-19 crisis, the European Union must regain lost ground and create more favorable conditions for inclusive and sustainable economic growth. The best way to achieve this goal is by increasing the Union’s innovativeness. This effort requires extensive and broad-based institutional reforms aimed at strengthening the incentives for entrepreneurship. Innovative entrepreneurship requires collaborations with numerous agents that provide those skills and resources that the entrepreneur is lacking: inventors, key personnel, demanding customers, and early and later-stage financiers. Based on this ecosystem perspective, we propose reforms in the following six broad areas: (i) the rule of law and property rights, ii) taxation, iii) savings and finance, iv) labor market regulations and social security, v) entry and exit barriers in product markets, and (vi) human capital for entrepreneurship. The reforms would likely strengthen Europe’s innovation capacity at a time when it is needed more than ever.

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  • Elert, Niklas & Henrekson, Magnus, 2021. "Improved Framework Conditions for a More Entrepreneurial, Innovative and Resilient EU," Working Paper Series 1384, Research Institute of Industrial Economics, revised 23 Oct 2021.
  • Handle: RePEc:hhs:iuiwop:1384
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    References listed on IDEAS

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    1. Elert, Niklas & Henrekson, Magnus, 2021. "Innovative Entrepreneurship as a Collaborative Effort: An Institutional Framework," Foundations and Trends(R) in Entrepreneurship, now publishers, vol. 17(4), pages 330-435, June.
    2. William J. Baumol, 2005. "Education for Innovation: Entrepreneurial Breakthroughs Versus Corporate Incremental Improvements," NBER Chapters, in: Innovation Policy and the Economy, Volume 5, pages 33-56, National Bureau of Economic Research, Inc.
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    6. Niklas Elert & Magnus Henrekson, 2019. "The collaborative innovation bloc: A new mission for Austrian economics," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 32(4), pages 295-320, December.
    7. Steven Klepper, 2016. "Experimental Capitalism: The Nanoeconomics of American High-Tech Industries," Economics Books, Princeton University Press, edition 1, number 10614 edited by Serguey Braguinsky & David A. Hounshell & John H. Miller.
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    17. Elert, Niklas & Henrekson, Magnus & Stenkula, Mikael, 2017. "Institutional Reform for Innovation and Entrepreneurship: An Agenda for Europe," Working Paper Series 1150, Research Institute of Industrial Economics, revised 16 Feb 2017.
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    More about this item

    Keywords

    Entrepreneurship; European Union; Innovation; Institutions; Policy reform; Regulation; Self-employment;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights

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