Economist GMAT Reading Comprehension Challenge #37
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Economist Article
Table of Contents
Economist Article: One way to make Europe more like Silicon Valley
Link: https://www.economist.com/business/2021/08/14/one-way-to-make-europe-more-like-silicon-valley
Paragraph Summaries
In Silicon Valley…
European entrepreneurs face much more pressure to succeed on their first endeavor than do their American counterparts.
In the past, French public authorities…
French entrepreneurs who were attached to failed businesses used to be flagged in public records, but this policy was changed in 2013.
Cristophe Cahn and Mattia Girotti…
Since the end of the flagging system, managers who were previously in the database receive more credit for less interest and are 19% more likely to set up a new business.
The impact was largest…
Young entrepreneurs with short records saw the biggest positive impact by the end of the flagging system.
The outcome is a vindication…
The end of the flagging system was pushed by French policymakers to encourage entrepreneurs to continue starting new businesses and this has largely had successful results.
Primary Purpose
To discuss the outcomes of a policy decision in a particular country
Main Idea
The French policy decision to stop publicly labeling entrepreneurs attached to failed ventures is a contributing factor for the recent increase in their likelihood to start new businesses.
Happy Studies
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