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Evalution fiscal entrepreneurship


Publication number: 2017-17
Authors: B. ter Weel, S. Vriend, T. Smits, J. Witteman & N. Rosenboom
Commissioned by: The Ministry of Economic Affairs
Publisher: SEO Amsterdam Economics

In the Netherlands there are several fiscal policies with as their primary goal to stimulate entrepreneurship. The Ministry of Economic Affairs has commissioned SEO Amsterdam Economics to analyze the effectiveness and efficiency of eight of such fiscal policies. In the analysis, a broad welfare perspective is taken into account. The empirical analysis has been done by means of CBS-microdata from the period 2007-2014.

First of all, the study shows who has used the fiscal policies as of 2007 and how these companies have developed since. There are relatively many entrepreneurs in the Netherlands but their growth is limited. A large part consists of ZZP-ers or small companies with less than 10 employees. The size of this group and the composition of the total group of companies that is taxable with Income tax has influence on the fiscal incentives in the system. Starting a company in the Netherlands is fiscally supported which may explain the large number of starting companies. The average profit of companies taxable with Income tax was in 2014 roughly € 36.000. The most profitable companies are less dependent on the fiscal policies.

The second goal of the evaluation was to examine whether the policy instruments added to the general welfare of the Netherlands. The analysis shows that there is limited growth amongst the companies and profits are low. Hence it is questionable whether these companies contribute to increasing economic growth, dynamic and employment. In terms of flexibility and participation there are positive effects of facilitating modern forms of cooperation. The question is however whether this form of cooperation would not also have arisen in the market without these fiscal policies.

Fiscal policy instruments for starting companies lower the threshold to start a company and hence stimulate entrepreneurship in the Netherlands. By temporarily sharing the entrepreneurial risk between government and companies it is more interesting for employees to switch to entrepreneur. Furthermore, it provides the opportunity for outsiders to participate on the labor market. The empirical analysis shows that the use of the policy instrument for starters does not lead to a substantially higher survival rate for starting companies. It shows that starters are not above average profitable, on average starters are the ones with the lowest profit.


Category: 2017, Bas ter Weel, Sandra Vriend, Tom Smits, Joost Witteman, Nicole Rosenboom, Competition & Innovation, Healthcare & Social Security, Financial Markets & Finance