Labour,the Enterprise Gap and the Red Queen

Abstract

This paper shows that Labour's enterprise policy targeted a closure of the ‘enterprise gap’, which is a disparity in the number of enterprises per 10,000 of the resident adult population in less prosperous compared with wealthier regions. Labour's policy has assumed that this gap can be closed through an increase in startup rates in these less prosperous regions. The paper shows that while Labour has managed to deliver an improvement in start-up rates, this has not brought about a closure of the enterprise gap as they expected. It uses the Red Queen Effect as a metaphor to explore the reasons for Labour's failure to close the enterprise gap, concluding that the scale of the increase in start-up rates that would be necessary to begin closing the enterprise gap may be unrealistic.