Public Policy, Entrepreneurship, and Venture Capital in the United States

43 Pages Posted: 7 Aug 2009 Last revised: 21 Nov 2014

Douglas J. Cumming

York University - Schulich School of Business

Dan Li

The University of Hong Kong - School of Economics and Finance

Date Written: April 23, 2013

Abstract

This paper empirically examines business starts, deaths, venture capital and patents in relation to U.S. public policy. The most consistent evidence in the data shows that lower levels of labor frictions and higher levels of SBIR awards are associated with more business starts and higher levels of venture capital per population. Counter to expectations, the data indicate a positive impact from the homestead exemption only among the bottom quartile homestead exemption states, and otherwise a negative impact. We analyze a variety of other policy instruments and compare the effects of policy in regular times with the financial crisis of 2008-2010.

Keywords: Entrepreneurial Finance, Venture Capital, Public Policy, Tax, Labor Law, Bankruptcy, SBIR

JEL Classification: G24, G32, G33, G38, K22, K31, K35, L26

Suggested Citation

Cumming, Douglas J. and Li, Dan, Public Policy, Entrepreneurship, and Venture Capital in the United States (April 23, 2013). Journal of Corporate Finance, Vol. 23, 2013. Available at SSRN: https://ssrn.com/abstract=1443508 or http://dx.doi.org/10.2139/ssrn.1443508

Douglas J. Cumming

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

HOME PAGE: http://booksite.elsevier.com/9780124095373/

Dan Li (Contact Author)

The University of Hong Kong - School of Economics and Finance ( email )

8th Floor Kennedy Town Centre
23 Belcher's Street
Kennedy Town
Hong Kong

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