We examine how three sources of asymmetric information affect the supply of entrepreneurs and unemployment. In the first case, banks cannot observe entrepreneurs' risk of failure so ration credit. This increases the number of entrepreneurs and the level of unemployment. In the second case, firms...

This paper surveys the various forms of market failure that can arise when innovating entrepreneurs consider entering an industry, and outlines possible implications for public policy. Externalities can arise from entrepreneurial activities such as spillover benefits from new innovations and...

The government policies that target start-up entrepreneurs have a significant effect on new firm success.In addition to government policy, many other factors act as sources of market failure for entrepreneurs. Initially, external factors related to firm failure are discussed.While these factors...