Po­licy le­vers can strengt­hen in­cen­ti­ves for en­tre­pre­neurs­hip and im­pro­ve the li­ke­lihood of suc­cess­ful new bu­si­ness star­tups

La Jornada (Canada) - - ENGLISH SECTION -

No doubt the­re are a host of country-spe­ci­fic ex­pla­na­tions for the var­ying ra­tes of de­cli­ne in en­tre­pre­neurs­hip. Ho­we­ver, the fact that all in­dus­tria­li­zed coun­tries are ex­pe­rien­cing po­pu­la­tion aging - at the sa­me ti­me en­tre­pre­neurs­hip is de­cli­ning - un­ders­co­res the po­ten­tial ad­ver­se ef­fects of de­mo­grap­hic chan­ges on en­tre­pre­neurs­hip.

Whi­le the­re’s little that go­vern­ments can do to stem po­pu­la­tions aging, a num­ber of po­licy le­vers are avai­la­ble to strengt­hen in­cen­ti­ves for en­tre­pre­neurs­hip and im­pro­ve the li­ke­lihood of suc­cess­ful new bu­si­ness star­tups. A re­cent set of es­says by lea­ding scho­lars in Ca­na­da, the U.S. and Eu­ro­pe ex­plo­red pos­si­ble po­licy re­forms to pro­mo­te and im­pro­ve en­tre­pre­neurs­hip.

Key among po­ten­tial po­licy re­forms is tax re­lief, both in the form of re­duc­tions in mar­gi­nal tax ra­tes for in­di­vi­duals and bu­si­nes­ses, and re­duc­tions (or even the eli­mi­na­tion) of ca­pi­tal gains ta­xes. The­se re­forms we­re broadly de­ter­mi­ned to strengt­hen the in­cen­ti­ves for peo­ple to start and grow bu­si­nes­ses (i.e. ta­ke risks) and ex­pand the pool of en­tre­pre­neu­rial ca­pi­tal.

Ot­her key po­ten­tial re­forms in­clu­de re­du­cing red ta­pe to ma­ke it ea­sier to start new bu­si­nes­ses and grow exis­ting ones, chan­ges to ban­king and fi­nan­cial re­gu­la­tions that would ma­ke it ea­sier for en­tre­pre­neurs to ac­cess the fi­nan­cial ca­pi­tal nee­ded to start and grow their bu­si­nes­ses, and po­li­cies en­cou­ra­ging in­crea­sed im­mi­gra­tion of in­di­vi­duals with skills and ot­her at­tri­bu­tes that ma­ke them po­ten­tial en­tre­pre­neurs.

Mo­reo­ver, im­pro­ving edu­ca­tio­nal pro­grams that help build en­tre­pre­neu­rial skills, and strengt­he­ning net­works con­nec­ting uni­ver­si­ties to bu­si­nes­ses and re­sear­chers in ot­her ins­ti­tu­tions, could al­so in­crea­se the supply of en­tre­pre­neu­rial ta­lent.

Fi­nally, in one of the set’s mo­re pro­vo­ca­ti­ve es­says, no­ted eco­no­mists Deir­dre McC­los­key and Art Car­den ex­plo­red the po­si­ti­ve ef­fects of a cul­tu­re that va­lues and pro­mo­tes en­ter­pri­se and en­tre­pre­neurs­hip, as op­po­sed to dis­pa­ra­ging such ac­ti­vi­ties. The im­por­tan­ce of their es­say can’t be overs­ta­ted gi­ven the re­cent an­ti-bu­si­ness rhe­to­ric in Ca­na­da and many ot­her in­dus­tria­li­zed coun­tries.

The va­rious po­licy initia­ti­ves to en­cou­ra­ge en­tre­pre­neurs­hip put forth by scho­lars in the es­say se­ries apply to dif­fe­rent coun­tries in var­ying de­grees. It’s clear, ho­we­ver, that de­ve­lo­ped coun­tries, in­clu­ding Ca­na­da, fa­ce a long-term de­cli­ne in en­tre­pre­neurs­hip that is at least par­tially dri­ven by de­mo­grap­hics.

Sin­ce de­mo­grap­hic trends can’t be ea­sily re­ver­sed, coun­tries will have to im­pro­ve the en­vi­ron­ment in which en­tre­pre­neurs and bu­si­nes­ses ope­ra­te to en­cou­ra­ge mo­re and bet­ter en­tre­pre­neurs. -TROYMEDIA

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