Abstract
The article examines the importance of active labor market programs (ALMP) targeted at entrepreneurship to explain cross- country differences in aggregate entrepreneurship rate. Using GEM data over the period 2002-2013 on 25 countries, the results suggest that start-up incentive programs are important driver of necessity entrepreneurship. However generous unemployment benefits reduce the positive outcome of ALMP on aggregate rate of necessity entrepreneurs. Because ALMP is the main determinant of necessity entrepreneurs, we find that the economic spin-off of such programs in terms of unemployment reduction is limited.
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