The Determinants of Venture Capital after the Financial Crisis:Evidence across Countries
Year: 2019
Type: dissertation
Abstract: This paper analyzes the determinants of venture capital (VC) investments after the 2008 Global Financial Crisis. We conduct a quantitative study using panel data methods with a data set of 17 OECD countries over the years 2007-2017. We use the reduced form models to analyze three main groups of factors affecting the demand for and supply of VC. The three groups include macroeconomic conditions, entrepreneurial environment, and technological opportunities. The results reveal that the short-term interest rate, market capitalization and the population percentage with tertiary education have a positive impact on venture capital investments, meanwhile, the unemployment rate, corporate profit tax and the growth of market capitalization are negatively correlated to VC investments. Moreover, we also perform regression analysis using the Financial Crisis period data and try to capture the effects of the crisis on the driving forces of VC investments. According to the comparison of regression results using data of different periods, we find that the Financial Crisis generates huge economic fluctuations, which makes the effects of determinants difficult to capture.
Author: Zhizheng Wang
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W3024650247