The goal of this project is to examine the determinants and employment impact of firm foundations and self-employment from theoretical and empirical viewpoints. In the theoretical part we will devise a model in order to explain start-up inclinations and the nexus between high start-up and shut-down rates on the basis of the existing neo-classical, or rather evolutionary economic approaches. It constitutes the basis for subsequent empirical analyses.

The aim of the empirical analysis it to identify similarities and dissimilarities for start-ups and self-employment between the European countries and to comprehend them against the background of the legal and economic framework conditions on the commodity and factor markets. The project focuses on self-employed university graduates and firms that were founded by jobless persons. We will place particular emphasis on start-ups in high-tech areas. Technology Politics and Innovation Activities in Private Enterprises The government accounts for a considerable share in the funding of research and development in Germany. Contrary to many other industrial nations, this share has not significantly declined during the nineties. Direct project support also accounts for a substantial share of funding. At the same time, direct project support by the Federal Ministry for Education and Research is frequently included in criticism levelled against regulations on governmental research and technology politics. Even though public technology politics hardly seem to have changed, a host of new regulations for the award of funding was adopted particularly since the mid-nineties. They applied especially to direct project support (e.g. primary projects, idea competitions such as BIOREGIO, INNOREGIO). Against this background, this project intends to improve evaluations on the latest development of direct project support by conducting a "historical" analysis of the relevant economic and political circumstances. In a second step, we will evaluate the implications of direct project support for R&D activities in private enterprises on the basis of data sets that have not been available for the Federal Republic thus far. In contrast to past analyses, our study will not focus on the implications of individual promotion programmes and projects, but rather on the evaluation of the direct promotion system as a whole.