We have the example of the attempt of a French Silicon Valley [1] while there is no incentive for entrepreneurs to build a company (sure, after some hassle, you can still set up your start-up, but if your idea gets success, your best hope is to be bought by an American company like Google). Another more recent example is the "cloud à la Française" where the government catch the buzzword for cloud-computing and wanted to have its own Amazon super-star company. Basically, what they did is try to make a big company out of thin air [2] while just ignoring all that already existed in the domain.
The current party detaining majority is the Socialist Party (PS) so the idea that innovation comes from the state and individual action is just a burden might be due to this situation, but I doubt it would have been a lot better with the other major party (UMP, more right-wing oriented), who has been in majority most of the time without improving the administrative maze of entrepreneurship.
I don't know about much the other countries of Europe (although I have heard that it was not so much better) but the situation of France is very frustrating.