This paper introduces a new factor, *entrepreneurship capital*, and links it to economic output in the context of a production function model. The authors define entrepreneurship capital as the capacity for economic agents to generate new firms and measure it through regional startup intensities, particularly in high-tech manufacturing and ICT industries. Using a production function model estimated for German regions, the study finds that entrepreneurship capital is a significant and important factor shaping output and productivity. The results suggest that policies focusing on enhancing entrepreneurship capital could be a new direction for economic policy, potentially improving regional economic performance.This paper introduces a new factor, *entrepreneurship capital*, and links it to economic output in the context of a production function model. The authors define entrepreneurship capital as the capacity for economic agents to generate new firms and measure it through regional startup intensities, particularly in high-tech manufacturing and ICT industries. Using a production function model estimated for German regions, the study finds that entrepreneurship capital is a significant and important factor shaping output and productivity. The results suggest that policies focusing on enhancing entrepreneurship capital could be a new direction for economic policy, potentially improving regional economic performance.