Skip to main content

Financial and Institutional Reforms for the Entrepreneurial Society

Periodic Reporting for period 2 - FIRES (Financial and Institutional Reforms for the Entrepreneurial Society)

Reporting period: 2016-06-01 to 2018-05-31

If there is anything we know for sure, it is that the future is uncertain. To prepare Europe for that uncertain future is to enhance its flexibility, resilience and adaptability. To restore innovative, inclusive and sustainable growth to the European economy, it must make the transition to an Entrepreneurial Society. Answering the call (EURO-2-2014) for a reform strategy, the FIRES-project proposed Financial and Institutional Reforms for an Entrepreneurial Society. In the project we conclude that reforms are urgent, necessary and desirable and should in general take Europe towards more contestable systems of knowledge, labour and capital allocation.

An Entrepreneurial Society allocates talent, finance, labour and knowledge to small scale, early stage, experimental economic activity and promotes an entrepreneurial attitude among European business owners, employees, citizens and policy makers alike. Our project has shown an Entrepreneurial Society to create jobs, opportunities and well-being while helping Europe to maintain its competitive position in global markets and develop the solution for the social and environmental challenges of the 21st century (WP3).

We also recognise, however, that designing and implementing institutional reforms to achieve such a transition must be different across the Union. The starting positions have historically evolved and are deeply rooted in history and culture (WP2). Moreover, case studies (WP5) illustrate the general point that deep historical roots, co-evolved institutional complementarities and global megatrends are important to map out before reform proposals can be considered. Anyone proposing a one-size-fit-all approach to promoting entrepreneurship in Europe makes a false start.

This sits somewhat uncomfortably with the general approach in economics and economic geography, where researchers implicitly or explicitly assume that the same model applies across space and time. In light of the above, such research should be treated with caution. FIRES-research nonetheless has shown that job creation, well-being, pro-social behaviour, corporate responsibility, smart-specialization, growth and innovation all correlate positively with entrepreneurial activity in Europe and thus convincingly established the urgency and desirability of making the transition to a more open and entrepreneurial economy.
To help policy makers identify priorities, we have developed a tool (WP4) then summarizes the quality of the entrepreneurial ecosystem in a single index. The value of this index lies in its ability to identify bottlenecks in the ecosystem and highlight priorities for tailored reform strategies. To complement the algorithmic, databased diagnostic tool the FIRES-project also collected new, more qualitative data from surveys across three European members states. This dataset contains detailed information about start up processes across institutional complexes. Careful analysis allowed us to triangulate our data based diagnosis with more direct and qualitative information for Italy, Germany and the United Kingdom. By confronting a thorough diagnosis of the state and functioning of the ecosystem with a long list of possible policy interventions and reform proposals that was developed in close dialogue with different stakeholder groups, we then illustrated the building of a tailored reform strategy for these member states in three country studies and corresponding policy briefs that were presented to national policy makers in the member states themselves.

An elaborate legal and political assessment, in which the entrepreneurship policy landscape in Europe was first mapped out and then legal competencies and political feasibility of the FIRES reform proposals were assessed, completed the work.

FIRES is unique in its multi- and transdisciplinary approach. Scholars from such diverse disciplines as geography, law, history, economics, business and innovation management engaged with stakeholders along the way. The research was fine-tuned and drafted with stakeholders with appositive stake in the entrepreneurial society, whereas reform proposals were discussed with representatives of the groups that are likely to experience or have to implement the largest changes to shape the transition. Finally the resulting reform strategies were discussed intensively with policy makers at the regional, national and European levels.
FIRES has delivered all foreseen deliverables with minimal delays. As foreseen 27 of the projects main results were reported in the form of manuscripts that have been published, are under review or submitted to peer reviewed journals. We have also secured contracts for the publication of a book and an edited volume, to publish the FIRES capstone deliverable D5.12 that contains the developed gross list of 62 reform proposals and the elaborated country studies for Italy, Germany and the UK. The FIRES-project has supported the presentation of FIRES-research at three academic conferences (WINIR2017, IECER2016 and 2017) and numerous seminars and presentations of individual FIRES-researchers as well as an open special issue on Financial and Institutional Reforms for the Entrepreneurial Society in Small Business Economics, that was published in the spring of 2018.
The contributions of the FIRES-project go beyond the papers and chapters that were published. FIRES’ most relevant progress beyond the state of the art is probably that our project has shown that multi- and transdisciplinary research has practical value and policy relevance. By combining insights and methods from different scholars and schools of thought and by triangulating their methods and approaches, a richer analysis resulted. By engaging stakeholders a list of creative and broadly supported policy proposals have been formulated. And by confronting analysis with proposals in specific local contexts, tailored reform strategies have been proposed. In the FIRES-project we believe and show that reform strategies should and can be tailored to locally diverse needs and bottlenecks and should be complemented with more fundamental institutional reforms to fuel the entrepreneurial society. The FIRES-project has pushed the scientific frontier and enhanced our understanding of (failing) entrepreneurship in Europe. More importantly it is pushing policy makers to go beyond the traditional boundaries of entrepreneurship policy making and in doing so consider the cultural and historical embeddedness of the economy. To restore innovative, inclusive and sustainable growth in Europe, we need to build a more open society in which it is safe to try, fail and take a risk. We have been pushing the frontiers of science in this project, but we hope to also have shifted the frontiers of policy making in Europe. The project has already been successful in reaching out to relevant policy makers at the regional, national and European level. We will present our work to the committee of the regions and the European network of SME envoys. Moreover, the work on assessing ecosystem quality will be further developed into a toolkit that can be used by policy makers throughout the Union. It is not up to the FIRES-project to actually implement the reforms proposed, but the project has gone as far as possible in delivering its pertinent messages to the stakeholders that may benefit from our work.