Impact of the Innovative Entrepreneurship Program in Uruguay

The objective of this research is to evaluate the impact of the Innovative Entrepreneurship instrument, implemented by the National Agency for Research and Innovation (ANII by its Spanish acronym) of Uruguay. This study presents several significant contributions. First, it uses data from innovative start-ups funded between 2008 and 2021, which were compiled into one of the largest databases used for this type of research. As well, an innovative econometric technique is applied that allows to work with unbalanced panels —an especially important aspect when analyzing a program that supports innovative start-ups, for which mortality rate is high— while also estimating the duration of the treatment effect. The findings provide evidence of investment leverage in innovation activities of 195%, indicating that firms supplement public funds with their own resources. Furthermore, it is observed that participation in the program induces persistent changes in the innovative behavior of companies, which persist over time. No impacts were found on the economic performance of companies.