The ambiguous effects of public assistance to youth and female start-ups between job creation and entrepreneurship enhancement

Marco Mariani (marco.mariani@irpet.it), Alessandra Mattei (alessandra.mattei@unifi.it), Lorenzo Storchi and Daniele Vignoli (vignoli@disia.unifi.it)
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Alessandra Mattei: Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Università di Firenze, https://www.disia.unifi.it

No 2017_04, Econometrics Working Papers Archive from Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti"

Abstract: Public support to start-ups often has the dual ambition of fostering self-employment of disadvantaged individuals while nurturing entrepreneurship. In this paper we evaluate a female and youth start-up program recently implemented in Tuscany (Italy), which provides public guarantees and subsidized interest rates to new firms. Under the assumption of strong ignorability of the assignment mechanism, we use a propensity score matching approach to draw inference on causal effects of the program on firms’ survival and job creation. Results suggest that public support in this area may have rather ambiguous effects. It helps females and young people escape unemployment or inactivity, and may lead to further job creation. Unfortunately, all this occurs at the price of committing public resources towards entrepreneurial projects that hardly gain efficiency over time.

Keywords: entrepreneurship; self-employment; program evaluation (search for similar items in EconPapers)
JEL-codes: J68 L26 R50 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2017-06
New Economics Papers: this item is included in nep-cse, nep-ent, nep-eur and nep-sbm
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