Financing future job creators
Wennberg, K. & Elmoznino Laufer, M. (2014). Financing future job creators. Rapport oktober 2014. Stockholm: Ratio och Företagarna.
Wennberg, K. & Elmoznino Laufer, M. (2014). Financing future job creators. Rapport oktober 2014. Stockholm: Ratio och Företagarna.
Research has shown that young businesses with growth ambitions are important for job creation and innovation. A major obstacle to economic growth is the lack of financing for young firms.The Ratio Institute and the Swedish Federation of Business Owners have conducted a study to outline the financial sources of young and small businesses in Sweden and to investigate the challenges for financing the firms.
We use a sample of 380 limited liability firms in Sweden that are members of the Swedish Federation of Business Owners. The majority of the firms were founded 2010-2013. For our sample, the results show that the majority of the firms (87 %) use personal savings to finance their firms, while 28 % use bank loans which is the second most common type of finance. However, many of the firms that were approved bank loans report that they had to use personal assets as collateral and personal guarantees to back up their loans. Also, many entrepreneurs took a temporary employment elsewhere and didn’t take out any salary at some time.
Our results suggest that economic policies should focus on measures that improve personal wealth accumulation. The results give further support to the findings of recent studies that have been conducted in Sweden that personal wealth accumulation is important and that it is difficult to obtain bank loans for young businesses.
Wennberg, K. & Elmoznino Laufer, M.
2014
2024
Small Business Economics, 62(2), 775-806
The dominant ‘sand in the wheels’ view holds that entrepreneurship is strongly inhibited by corruption. Challenging this, the ‘grease the wheels’ view maintains that corruption might increase entrepreneurship in highly regulated economies. We extend the basic predictions of these theories by examining entrepreneurs’ start-up decisions, as well as their location choices, in a seemingly low-corruption environment: Swedish municipalities. Combining a validated index of corruption perceptions in local government with population data on new entrepreneurs, nested logit models reveal that even in a low-corruption setting such as Sweden, perceptions of corruption can deter latent entrepreneurs. We also find that a minority of entrepreneurs relocate from their home municipalities to establish their start-ups elsewhere. Surprisingly and contrary to expectations, these relocating entrepreneurs often relocate from relatively low-corruption municipalities to others that are more corrupt. Implications for future research and public policy are discussed.
2024
In Moonshots and the New Industrial Policy (pp. 125–143). Springer.
This chapter reviews theoretical rationales for mission-oriented innovation policy and provides an empirical overview of extant 28 papers and 49 cases on the topic. We synthetize varieties of mission formulations, actors involved, and characteristics of missions described as more or less failed or successful. Fifty-nine percent of the studied missions are still ongoing, 33 percent are considered successful, and 8 percent as failures. Sixty-seven percent of the studied missions have taken place in Europe, 24 percent in North America, and 8 percent in Asia. The majority of innovation projects referred to as missions do not fulfill the criteria defined by the OECD. Results suggest that missions related to technological or agricultural innovations are more often successful than broader types of missions aimed at social or ecological challenges. Challenges regarding the governance and evaluation of missions remain unresolved in the literature. We find no case that contains a cost-benefit analysis or takes opportunity cost into account.
2024
Foundations and Trends® in Entrepreneurship, 19(8), 664-772.
While considerable efforts have been made to conceptualize and outline the theoretical and normative logic of mission-oriented innovation policies and the role of the entrepreneurial state, there is a stark lack of empirical studies concerning how missions are designed and executed, and when they may work or do not. This monograph reviews theoretical rationales for mission-oriented innovation policy and provides an empirical overview of 30 articles which together cover 51 concluded or ongoing missions from around the world. We synthetize varieties of mission formulations, actors involved, and analyze characteristics of missions described as more or less failed or successful. Among the projects analyzed, many do not fulfill common definitions of “innovation missions.” Missions related to technological or agricultural innovations seem more often successful than broader types of missions aimed at social or ecological challenges, and challenges in the governance and evaluation of missions remain unresolved in the literature. None of the mission cases contain a cost-benefit analysis or takes opportunity cost into consideration.