In the growing start-up culture in India, the need to enforce non-compete clauses in employee agreements has become relevant. However, according to a study conducted by James Rauch, the enforcement encourages original ideas to find a way more easily than spin-offs and will restrict entry of socially profitable spin-offs. That said, Rauch says that non-enforcement helps the social welfare of the company more. In fact, entrepreneurs might also face constraints if lenders know that they have to buy out their non-competes to start the company.
To compete or non-compete
The enforcement of non-compete clauses in employee agreements encourages originality
Summer wine and salad
Kishore Singh - January 19, 2015
A double topping for growth
Meghna Maiti - January 15, 2015
The million-dollar question: Is investing a game of luck or skill?
Shankar Sharma - May 04, 2021
Scriptures for success
Kripa Mahalingam - January 27, 2015
Where's the party tonight?
Aditi Saxena - January 27, 2015