Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282614 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16487
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Mission-oriented innovation policies are becoming increasingly popular among policymakers and scholars. We maintain that these policies are based on an overly mechanistic view of innovation and economic growth, suggesting that a more bottom-up approach is called for. By invoking an entrepreneurial ecosystem perspective, we point out that innovative entrepreneurship requires many other actors—besides the entrepreneur—whose skills and abilities are necessary to realize an entrepreneurial project. When mission-oriented policies play a large role in the economy, connections between actors in the ecosystem risk becoming distorted. A functioning and well-balanced entrepreneurial ecosystem requires instead an institutional framework that levels the playing field for potential entrepreneurs and encourages productive entrepreneurship. To promote this kind of system, we discuss in more detail eight key areas where appropriate horizontal or bottom-up policy measures can foster innovation and, in the end, the welfare-enhancing productive entrepreneurship policymakers and scholars strive for.
Subjects: 
collaborative innovation bloc
entrepreneurial ecosystem
entrepreneurship policy
institutions
public choice
JEL: 
H50
L26
O31
P16
Document Type: 
Working Paper

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