This is an open access book. Europe faces significant challenges in the coming decades:
geopolitical demographic technological increased competition climate-related and health
issues due to an aging population to mention a few. Given these challenges technological
progress and new ways of handling complex issues will be key to continued prosperity and
growth. To accomplish a growth process driven by innovation and entrepreneurship the
institutional environment must take into account a multitude of different policy areas that
interact to either strengthen or weaken an economy's innovative potential. Innovation is not
only about R&D and higher education but is also intimately related to entrepreneurship.
Similarly entrepreneurship is not only about low start-up costs and favorable tax rates. Hence
a consistent and coordinated policy environment conducive to innovation and entrepreneurship is
required to translate innovation into high-growth firms and macro-level growth. This book
presents the basic cornerstones required to provide a policy regime that can nurture such
dynamics. The authors draw extensively on empirical analysis of the development of the Swedish
economy which has been transformed from a so-called sclerosis state in the 1980s until the
early 1990s to an economy characterized by successful entrepreneurship and innovation. This
transformation resulted from a reform agenda that has been gradually rolled out beginning in
the mid-1980s. The authors argue that the Swedish experience provides useful lessons for other
nations as well.
