Across the Globe: Do Governments Support or Stifle Innovation?

Although the number of entrepreneurs around the globe is heavily outnumbered by bureaucrats and government bodies you could still argue that they have a strong influence in shaping the world of commerce.

The big question is do governments go out of their way to assist their entrepreneurial endeavors or do they practice the politics of envy and try to stifle their progress?

Here are some thoughts to consider on the subject.

Encouraging innovation

Global corporations are widely viewed as having an advantage and cementing their dominant position over smaller rivals thanks to being well connected in government circles but you could argue that innovators also get a fair hearing in some countries.

A reasonable number of governments around the globe tend to offer access to funding that is intended to help fuel innovation and turn ambitious startup projects into a reality.

Most of the major developed countries offer some sort of financial aid and program that is intended to encourage entrepreneurs to do what they do best, innovate.

Small business owners represent a significant percentage of the economy and it could be argued that it would not be in a government’s interest to attempt to stifle innovation.

Misguided help?

Another point to consider is that because government bodies do not have the freedom or mindset to embrace an entrepreneurial mindset it could be argued that they could be getting their funding policies wrong rather than denying access to free money for businesses.

An example of this would be when a government measures the success of its innovating funding programs by the amount of money it gives out rather than monitoring whether it has borne fruit in helping a business to become successful.

It stands to reason that if someone withing the government, who does not have the commercial acumen required to make an accurate assessment of an application, is being left to decide which ventures to back and which ones to reject, it will almost certainly make some misguided decisions.

Look to the Eurozone for inspiration

It is encouraging to see positive government collaboration in action and the European Commission is a prime example of that.

The Horizon 2020 program, aimed at encouraging innovation in the Eurozone shows that governments can listen and do attempt to encourage creative business thinking rather than stifling it.

The program took clear inspiration from Silicon Valley and sought to replicate the success of that area in Europe.

A key feature of the program is the fact that it actively encourages entrepreneurs to network and provide feedback which gives startups some valuable insights and support at a time when they need it most.

Another accurate measure of how successful government support has been when it comes to innovation is how many jobs are created as a result of providing access to funds.

About a third of new jobs created within Europe are attributed to startups so it is abundantly clear that governments are more likely to be more interested in encouraging innovation than stifling it.

They might not always get it right but at least you can find examples of their willingness to offer access to money that could be used to create a successful business venture.