Financing entrepreneurial activity in Chile: scale and scope of public support programs

摘要

This paper overviews the sources currently financing entrepreneurship in Chile, with special emphasis on public instruments, and uses the information gathered by Global Entrepreneurship Monitor (GEM) Chile between 2003 and 2006 to test the hypothesis that, despite public efforts, there is still a finance gap, and that this may significantly influence domestic economic performance in the long term. After a thorough bibliographic review regarding financial alternatives in Chile and a descriptive analysis of GEM data, results show that while there is sufficient available public funding in Chile, it is not being channeled to a sufficiently wide range of entrepreneurs. Some of the factors that reduce the impact of Chilean public financing policies and that require further research include the lack of competitive high-tech clusters within the country; the lack of attention given to informal investment and to the training of entrepreneurs; and the existence of centrally designed programs that do not take into account the geographical organization of capital markets and the spatial differences and gaps in private financing.