12 - Knowledge, Power, and Entrepreneurs: A First Pass at the Politics of Entrepreneurship Policy

Summary

The politics of entrepreneurship policy are underdeveloped. Entrepreneurs have their hands full building businesses and typically ignore, if not disdain, collective action aimed at the public good. Yet entrepreneurial success depends critically on good governance, which can only emerge through collective action of some sort. Policymakers, on the other hand, are acutely aware that their terms in office depend heavily on the vitality of the economy and the industries that drive its growth, but they often lack the knowledge and power to devise and implement policies that would enhance economic growth by fostering entrepreneurship.

The entrepreneurial and policy communities have much to offer one another. The involvement of entrepreneurs in designing and supporting entrepreneurship policy could make the efforts of policymakers more politically viable and economically effective. The links between them are thin at best, however, and sometimes nonexistent. Skeptics on both sides of the entrepreneur/policymaker divide have reasonable grounds for their doubts. Entrepreneurship policy advocates must build institutions and change ingrained beliefs if they want to construct durable coalitions that bridge the divide and produce good policy outcomes.

This chapter explores the problems and promise of coalition building between entrepreneurs and policymakers. The argument is largely theoretical and hypothesis-framing, since little empirical work has been done in this area. I begin by making the case for the importance of this coalition, arguing that there is no adequate substitute for the power and knowledge that a politically engaged entrepreneurial community can bring to the policy process.