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Public cluster policy and new venture creation

Author

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  • David B. Audretsch

    () (Indiana University, School of Public and Environmental Affairs)

  • Erik E. Lehmann

    () (CCSE, Faculty of Business and Economics
    University of Augsburg, Faculty of Business and Economics)

  • Matthias Menter

    () (University of Augsburg, Faculty of Business and Economics)

Abstract

Abstract Entrepreneurship polices are perceived as an effective means to shape regional development and facilitate innovation. However, empirical evidence on the full scope of public cluster policy and the associated impact on entrepreneurial engagement is scarce. This paper addresses this issue and investigates the impact of public cluster policy on new venture creation in Germany. Based on a unique dataset ranging from 1998 to 2012 encompassing all 150 German labor market regions, we examine the effects of the ‘Leading-Edge Cluster Competition’ on new venture creation. Applying treatment and difference-in-differences estimation techniques, we evaluate whether the treated cluster regions show different entrepreneurial performance paths compared to the control group, i.e. non-government-subsidized regions. Our results confirm that public cluster policies positively affect regional entrepreneurial activities, but only in part. The overall effect of governmental subsidization—the treatment effect—is rather low compared to the impact of local research intensive universities and the innovative milieu on new venture creation.

Suggested Citation

  • David B. Audretsch & Erik E. Lehmann & Matthias Menter, 2016. "Public cluster policy and new venture creation," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 43(4), pages 357-381, December.
  • Handle: RePEc:spr:epolin:v:43:y:2016:i:4:d:10.1007_s40812-016-0050-9
    DOI: 10.1007/s40812-016-0050-9
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    Cited by:

    1. Andrea Bellucci & Luca Pennacchio & Alberto Zazzaro, 2016. "Public subsidies for SME research and development: Empirical evaluation of collaborative versus individual place-based programs," Mo.Fi.R. Working Papers 133, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.

    More about this item

    Keywords

    Public cluster policy; New venture creation; Knowledge spillovers;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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