The Short-Run Effects of GDPR on Technology Venture Investment
43 Pages Posted: 5 Mar 2019 Last revised: 3 Jun 2019
Date Written: May 31, 2019
The General Data Protection Regulation (GDPR) was enacted in the European Union in April 2016 and went into effect in May 2018. We study its impact on investment in new and emerging technology firms. Our findings indicate negative post-GDPR effects after its 2018 rollout on EU ventures, relative to their US counterparts, but no such effects following its 2016 enactment. The negative effects manifest in the total amounts raised across funding deals, the number of deals, and the amount raised per individual deal, and are particularly pronounced for newer and data-related ventures.
Keywords: Data, Regulation, GDPR, Investment, Venture Financing
JEL Classification: L13, D8, L5, L15, D43
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