Public Economics Gone Wild: Lessons from Venture Capital

36 Pages Posted: 7 Nov 2013

Multiple version iconThere are 2 versions of this paper

Date Written: November 4, 2013

Abstract

A recent article in the Journal of Public Economics has asserted, among other things, that government venture capital funds in Europe have crowded out private venture capital. I explain that the findings in that paper are based on empirical measures that are completely flawed. Moreover, I show with data spanning 13 countries and the years 1989-2011 that government venture capital funds in Europe have not crowded out private venture capital investment. Finally, I draw implications for studying venture capital and public policy for other countries such as India and China.

Keywords: Venture capital; Public Policy; Government sponsorship; Tax; Crowding out

JEL Classification: G24, G28, G32, G38, K22

Suggested Citation

Cumming, Douglas J., Public Economics Gone Wild: Lessons from Venture Capital (November 4, 2013). International Review of Financial Analysis, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2349817

Douglas J. Cumming (Contact Author)

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

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

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