Randomized Control Trial Data on Entrepreneurship and Innovation

Randomized control trials are a tool that have proved helpful in medicine and many other fields, and now they are becoming more and more routine within the study of entrepreneurship and innovation.

They are a tool for attempting to help identify the true impact of a path taken, or treatment given, because in the real world it is not possible to take two paths simultaneously with the same individual or company and observe both. Thus, in most of research and data we are left to observe correlation – tempering our findings on what works or does not in promoting entrepreneurship.

But this is starting to change – slowly. The trends in Economics to use more randomized controls have been on the uptick for some time, but the formalization of the trend in entrepreneurship and innovation has only taken form in recent months. 

trials databaseNESTA, a charity from the United Kingdom with a mission to help people and organizations bring great ideas to life, announced the formation of their Innovation Growth Lab (IGL), which is solely devoted to this topic. IGL is an ambitious effort to begin to form a global partnership focused on randomized control in the following areas:

  • The Effectiveness of Goal Setting and Accountability in Group-Based Entrepreneurship Initiatives
  • A Randomized Control Trial to Identify the Effect of Tech Incubators on Startups
  • Mini-Sales Accelerator with Corporate Match Making
  • Business-science links and technology transfer
  • Unbundling the effect of entrepreneurship education programs
  • Rethinking Innovation Spaces

As a part of building the field, the IGL will be curating and collecting data from as many randomized control experiments as possible. Currently they have identified 54 trials that fit the topic, with 23 of these studies still underway. The data, which will become available through IGL, will continue to grow as the field expands. Kauffman and IGL have partnered to fund some new randomized control projects in the area. A new solicitation for projects has also been announced with a deadline in January 2015.

As we seek to broaden the types of entrepreneurship research and conclusions that can be drawn from such research, randomized control trials will be a good tool. They will never be the only tool given the cost they often require and difficulty of real-life implementations, but with a broadening community and more forethought, there are many ways in which staggered interventions or other techniques can also be used to identify causation.



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e.j. reedy data maven

E. J. Reedy

As a director in Research and Policy, E.J. Reedy oversees the Ewing Marion Kauffman Foundation’s research initiatives related to education, human capital development, and data.

Since joining the Kauffman Foundation in 2003, Reedy has been significantly involved in the coordination of the Foundation’s entrepreneurship and innovation data-related initiatives, including the Kauffman Firm Survey, for which he served as a principal investigator, and the Foundation’s multi-year series of symposiums on data, as well as many web-related projects and initiatives. He is a globally recognized expert in entrepreneurship and innovation measurement and has consulted for a variety of agencies.