We speak frequently in class about the role of government in fostering entrepreneurship. From easing regulations to making access to additional financing more readily available, government plays an pivotal role in cultivating entrepreneurship.
This article highlights a recent speech given by the head of the IMF. In the article, Christine Lagarde talks about the delicate role that governments must balance. She advocates the role of government in providing funding to certain technologies, while cautioning government to be aware enough to remove unnecessary barriers to competition and cut red tape. She advocates for providing more state funding to R&D and pushes the notion that it would boost GDP. The intersection of public and private financing in entrepreneurship and the competing policy agenda’s that stem from these divergent financing schemes provide for an interesting debate.
If the government and start up companies and entrepreneurs are able to work together on the same platform and trajectory, then innovation would be spurred. Social benefits for entrepreneurs can be increased greatly if the avenues from the government would be easier to navigate and maneuver. If governments restrict these opportunities, then companies must find ways to get to their goals in a more difficult manner.