Researchers at Stanford have found that making bankruptcy laws less punitive motivates the most promising entrepreneurs to start successful businesses. The new study introduces the concept of a “failure barrier” and how lowering it can yield powerful and positive economic results.
Experts in Stanford’s Department of Management Science and Engineering (MS&E) studied entrepreneurial activity in Japan before and after the nation reformed its bankruptcy laws in 2003. The laws went from being a mechanism for punishing poor managers and forcing debt recovery, to a more forgiving set of policies that allowed executives to keep their jobs and reorganize their failed firms.
To read the full, original article click on this link: Spurring Successful Entrepreneurship by Bringing Down ‘Failure Barriers’ | Stanford Technology Ventures Program
