Abstract
The number of businesses starting up from a home base has been growing steadily over the past decade in many countries. Home-based businesses have been seen as a ‘safe’ way to test a new business idea and a low risk option for a person wishing to start a new business. As such they have caught the attention of governments. However, generally governments have been slow to develop policy to guide those that invest in these businesses or to regulate them. What governments have tended to do instead is group them with other small businesses and view them all as an avenue to promote small business ownership as a way of increasing economic activity, particularly in regional areas. Whether public support for home-based businesses provides a return on investment (ROI) has received little attention. The question therefore is, do home-based businesses make a sufficient economic and social contribution to the public purse to warrant the use of public funds to support and promote them? While a home-based business may add to the social fabric of a community, and be a real financial option to mainstream employment for the owner, does it add economic value to a region? This paper aims to develop a policy measure for targeting the support of home-based businesses and focus in on whether public support for home-based businesses provides a ROI.