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Subject matter of the paper includes the main factors necessary for the establishment of macroeconomic ambiance that fosters the development of innovations and entrepreneurship. The aim of the paper is to show that the role of the state (fiscal policy) is not only important, but often decisive in the forming of macroeconomic conditions for self-initiative economic efforts of entrepreneurs and innovators. Therefore, the method used in this paper is the analysis of the fiscal policy, its instruments and measures as well as other activities in its domain, which contribute to the increase of entrepreneurship and innovations. Additionally, the method of case study is also used. Namely, since the State of Israel is worldly known as the 'start-up nation', the secondary research is conducted by analysis of the efforts of the fiscal policy and other activities in the State of Israel as a good practice for continuous improvement of macroeconomic ambience that encourages the ever increasing innovations and entrepreneurship undertakings. The main conclusion refers to the fact that empowering the innovations and entrepreneurship is necessary for the economic growth, and for the change of the economy's structure towards the more technically and technologically developed economic sectors

Macroeconomic ambiance in the function of encouraging innovations and entrepreneurship: Case study of the state of Israel