Public cluster policy and new venture creation

David B. Audretsch (), Erik Lehmann () and Matthias Menter ()
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David B. Audretsch: Indiana University, School of Public and Environmental Affairs
Matthias Menter: University of Augsburg, Faculty of Business and Economics

Economia e Politica Industriale: Journal of Industrial and Business Economics, 2016, vol. 43, issue 4, No 2, 357-381

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.

Keywords: Public cluster policy; New venture creation; Knowledge spillovers (search for similar items in EconPapers)
JEL-codes: L26 O32 O38 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (18)

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DOI: 10.1007/s40812-016-0050-9

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