Does private equity investment spur innovation? Evidence from Europe

We provide the first cross-country evidence of the effect of investment by privateequity firms on innovation, focusing on a sample of European countries and usingKortum and Lerner’s (2000) empirical methodology. Using an 18-country panelcovering the period 1991-2004, we study how private equity finance affects patentapplications and patent grants. We address concerns about causality in several ways,including exploiting variation in laws regulating the investment behaviour of pensionfunds and insurance companies across countries and over time. We also control forthe standard determinants of innovation like...

MoreLess

Year of publication:	2009-06-17
Authors:	Popov, Alexander ; Roosenboom, Peter
Institutions:	European Central Bank
Published in:	Working papers published in 2009 ECB Working Paper Series No. 1063, June 2009
Subject:	Risikokapital \| risk capital \| Innovation \| Eigenkapital \| 1991 - 2004

freely available

Full text |

More access options

Check Google Scholar

In libraries world-wide (WorldCat)

In German libraries (KVK)

I need help

Abstract
Non-technical summary
1 Introduction
2 Risk capital and the fi nancing of younginnovative companies
3 Data
4 Empirical methodology and initial estimates
4.1 Patent production function
4.2 Initial estimates
5 Addressing the causality problem
5.1 A simple model
5.2 Instrumental variable estimation
5.3 Accounting for technologicalopportunities
6 Robustness tests
6.1 Accounting for the country-leveldeterminants of innovation
6.2 Evidence from the Europeanbiotech industry
7 Conclusion
References
Tables
Appendices
European Central Bank Working Paper Series

Persistent link: https://www.econbiz.de/10005866520