Abstract

http://ssrn.com/abstract=2194450
 
 

References (42)



 
 

Footnotes (16)



 


 



Venture's Economic Impact in Australia


Douglas J. Cumming


York University - Schulich School of Business

Sofia Johan


York University - Schulich School of Business; Tilburg Law and Economics Center (TILEC)

December 28, 2012


Abstract:     
We empirically compare the contributions of venture capital (VC) and private equity (PE) backed firms, including those backed by government subsidized Innovation Investment Funds (IIFs), to the Australian economy by analyzing employment, R&D, patents, time to IPO, and market capitalization from market inception to August 2012. VC-backed firms exhibit no material difference in employment, but do exhibit higher levels of R&D and patents and, after the passage of sufficient time, have greater market capitalization relative to PE- and non-VC/PE/IIF-backed firms. IIF-backed firms likewise exhibit no material difference in employment, but do result in a higher percentage of investments that are publicly listed and a greater market capitalization relative to both VC- and PE- and non-VC/PE/IIF-backed firms, controlling for other things being equal. PE-backed firms generate higher levels of employment, counter to anecdotal claims to the contrary. Overall, the data highlight a central role for VC and IIF investment in facilitating R&D, innovation, and economic growth. The data indicate an expansion of venture investments would facilitate more innovation and economic growth in Australia relative to the expansion of other sources of capital, particularly in view of the comparative dearth of venture investments in Australia relative to other countries.

Number of Pages in PDF File: 42

Keywords: Venture Capital, Private Equity, Patents, R&D, Employment, IPOs, Market Capitalization, Government Policy

JEL Classification: G24, G28

working papers series


Download This Paper

Date posted: December 29, 2012 ; Last revised: January 3, 2013

Suggested Citation

Cumming, Douglas J. and Johan, Sofia, Venture's Economic Impact in Australia (December 28, 2012). Available at SSRN: http://ssrn.com/abstract=2194450 or http://dx.doi.org/10.2139/ssrn.2194450

Contact Information

Douglas J. Cumming (Contact Author)
York University - Schulich School of Business ( email )
4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
HOME PAGE: http://www.venturecapitalprivateequitycontracting.com/
Sofia A. Johan
York University - Schulich School of Business ( email )
4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
Tilburg Law and Economics Center (TILEC) ( email )
Warandelaan 2
Tilburg, 5000 LE
Netherlands
Feedback to SSRN


Paper statistics
Abstract Views: 540
Downloads: 134
Download Rank: 109,977
References:  42
Footnotes:  16
Paper comments
No comments have been made on this paper

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo5 in 0.468 seconds