

Countries with social safety nets have many more startups - neilk
http://www.samefacts.com/2011/10/safety-nets-hammocks-or-trampolines/

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dan85
How did the author connect the number of startups with the safety net and
reached the conclusion that the safety net is a good (or a bad) thing?

What if in countries with social safety nets it is much more cheaper to spawn
a new extra company than to let your current one grow too big? For example, a
country might require a lot less paperwork from companies with less than 10
employees. The same country might require a lot of extra regulation for a
company with more than 20 employees. So you might be BETTER OFF WITH _3
companies x 10 employees_ than with _1 company x 30 employees_.

I am curious to know:

(1) what is the ratio of startups that grow beyond the stage of a small
company in those contries.

(2) what is the ratio of startups which provide jobs for at least 2 other
people besides the owners. I'm willing to bet that in the European ex-
communist countries, the vast majority of startups are actually small shops
which barelly allow a family to survive (with the only employees being husband
and wife).

.

The number of startups as presented in the article doesn't really say much at
all and the conclusion really was just pulled out of thin air. One could as
well say _"Safety nets: ball and chain (You can't grow beyond startup level)"_
without changing a single word in that article.

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paulhauggis
They might have more startups.

However, typically, once you get your company past the startup level, there
are many more restrictions and taxes associated with running a company.

So you have a small short-term gain.

