Scandinavian Working Papers in Economics
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Research Institute of Industrial Economics (IFN) Working Paper Series

No 826:
Taxation, Labor Market Policy and High-Impact Entrepreneurship

Magnus Henrekson (), Dan Johansson () and Mikael Stenkula ()

Abstract: Public policy affects the prevalence and performance of both productive and high-impact entrepreneurship. High-impact entrepreneurship prospers when knowledge is successfully generated and exploited in the economy. This process depends on complementary key ac-tors who use their competencies in what we denote a competence bloc. Although variations in economic contexts make prescribing a general panacea impossible, a number of relevant policy areas that affect key actors can be identified. In this paper this is done in the areas of tax policy and labor market policy. It is shown that high and/or distortive taxes and heavy labor market regulations impinge on the creation and functioning of competence blocs, thereby reducing high-impact entrepreneurship.

Keywords: Entrepreneurship; Gazelles; High-growth firms; High-impact entrepreneurship Innovation; Institutions; Labor market policy; Tax policy; (follow links to similar papers)

JEL-Codes: H32; L25; L50; M13; O31; P14; (follow links to similar papers)

33 pages, March 23, 2010

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This paper is published as:
Henrekson, Magnus, Dan Johansson and Mikael Stenkula, (2010), 'Taxation, Labor Market Policy and High-Impact Entrepreneurship', Journal of Industry, Competition and Trade, Vol. 10, September, No. 3-4, pages 275-296

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