Entrepreneurs in different countries face varying costs to start a business, influenced by government policies. This study looks at how international trade impacts government incentives to lower entry costs and how subsidies can be used strategically. In a model with two countries and different firms, entry subsidies in closed economies lead to more and better firms. In open economies, subsidies affect both domestic and foreign firms' exporting decisions. The research finds that entry subsidies increase then decrease with trade openness, creating a U-shaped relationship between openness and entry costs.