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This paper reviews the literature concerning the impact that venture capital investments have on economic growth, mainly focusing on the firm level. The authors consider new insights gained in the 1990s as well as North American and European practices. The authors provide an overview of recent explanations for the existence of venture capital and explore the impact of formal venture capitalists on growth and thus exclude informal or private investors. The authors summarize trends in venture capital in the United States and Europe, stressing the impact of government initiatives on macroeconomic growth. The authors conclude with theoretical progress made in venture capital research and offer suggestions for paths to take in the future.

This paper explores what small and medium-sized enterprise (SME) policy is about, how it is pursued in Europe, and the differences between the European countries. According to the author, the overall objectives of SME policy are to create employment, foster economic growth, improve competitiveness, and regional/structural development. The SME-related policy pursued in most European countries involves a collection of various objectives and fields of economic policy rather than a conceptual framework. The author discusses the various approaches of SME policy that take place in the following European countries: Germany, Spain, Portugal, Italy, the Netherlands, the United Kingdom, Denmark, France, and Belgium. The author also discusses the variation of instruments used in the following fields of SME policy: start-ups, finance, exports and internationalization, information, research and development, labor, and red tape.