Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/108693
Authors: 
Caliendo, Marco
Hogenacker, Jens
Künn, Steffen
Wießner, Frank
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 8817
Abstract: 
Offering unemployed individuals a subsidy to become self-employed is a widespread active labor market policy strategy. Previous studies have illustrated its high effectiveness to help participants escaping unemployment and improving their labor market prospects compared to other unemployed individuals. However, the examination of start-up subsidies from a business perspective has only received little attention to date. Using a new dataset based on a survey allows us to compare subsidized start-ups out of unemployment with regular business founders, with respect to not only personal characteristics but also business outcomes. The results indicate that previously unemployed entrepreneurs face disadvantages in variables correlated with entrepreneurial ability and access to capital. 19 months after start-up, the subsidized businesses experience higher survival, but lag behind regular business founders in terms of income, business growth and innovation. Moreover, we show that expected deadweight losses related to start-up subsidies occur on a (much) lower scale than usually assumed.
Subjects: 
innovation
deadweight effects
entrepreneurship
start-up subsidies
evaluation
JEL: 
C14
L26
J68
Document Type: 
Working Paper

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