Regulatory Harmonization and the Development of Private Equity Markets

37 Pages Posted: 8 Nov 2005

See all articles by Sofia Johan

Sofia Johan

Florida Atlantic University - Finance; Tilburg Law and Economics Center (TILEC)

Douglas J. Cumming

Florida Atlantic University

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Abstract

This paper introduces a new dataset from 100 Dutch institutional investors' domestic and international asset private equity allocations. The data indicate that the perceived comparative dearth of regulations of private equity funds impedes institutional investor participation in private equity funds, particularly in relation to the lack of transparency. The data further indicate that the perceived importance of regulatory harmonization of institutional investors has increased Dutch institutional investor allocations to domestic and international private equity funds. The Financieel Toetsingskader (regulation of portfolio management standards such as matching of assets and liabilities) has had the most pronounced and robust effect, followed by Basel II (regulation of risk management and disclosure standards) and the International Financial Reporting Standards (regulation of reporting standards and transparency).

Keywords: Private Equity, Venture Capital, Law and Finance

JEL Classification: G23, G24, G28, K22, K34

Suggested Citation

Johan, Sofia A. and Cumming, Douglas J., Regulatory Harmonization and the Development of Private Equity Markets. Journal of Banking & Finance, Vol. 31, pp. 3218-3250, 2007. Available at SSRN: https://ssrn.com/abstract=842964

Sofia A. Johan (Contact Author)

Florida Atlantic University - Finance ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Douglas J. Cumming

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

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

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