Introduction to Entrepreneurship, internship MKB Amsterdam, week 45, Benjamin Collins

Introduction to Entrepreneurship, internship MKB Amsterdam, week 45, Benjamin Collins

Hi everyone,

This week we didn’t have a meeting with our supervisor at MKB Amsterdam, instead we spent a whole day looking up if there is any existing research concerning the encouragement of sustainable entrepreneurship by means of subsidies from governments around the world. A few interesting outcomes are stated in the papers that we found. Government credit subsidies exert strong effects on the allocation of credit to targeted entrepreneur, but at the cost of non-targeted entrepreneurs (Li, 1999). This means that although some SME’s profit from these regulations, it has a negative effect on performance of the SME’s that are not in these programs. The cost of these negatively influenced SME’s should also be calculated in the big picture, at least, that is our opinion. Other papers suggest that it is not in the nature of entrepreneurs to rely on government credit programmes to maintain a successful business case. This can result in situations where not all of the money that has been reserved for subsidies is used by SME’s. On the other hand it can also occur that the regulations surrounding the government credit on products can be too different from the current situation in the market, in which case the subsidies for instance grant unrealistically positive prices for the producers, and thereby creating an excess of the product being released on the market. All these problems have to be taken into consideration in our internship research. Furthermore we are expecting a lot from this research if we can specify it down, because this will hopefully generate a more detailed end result that different parties can use in the real world.

Benjamin Collins

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