Performance Persistence in Private Equity: Skill, Structure, and Statistical Artefacts

Oylum Sehvez Erguzel
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Oylum Sehvez Erguzel: Sakarya University, Turkey

No 2026/03, Working Papers IES from Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies

Abstract: This paper reviews the empirical literature on performance persistence in private equity (PE). It argues that observed persistence reflects three interacting forces: managerial skill, structural advantages, and measurement artefacts. It compares findings across return metrics, units of analysis, datasets, geographies, and time periods, with attention to biases from cash flow timing, fund overlap, and selective reporting. The review finds a genuine skill component, especially in venture capital, but shows that persistence estimates often weaken under stricter methods and richer data. Implications are drawn for fund selection, performance evaluation, and future research design.

Keywords: Private Equity; Performance; Performance Persistence; Managerial Skill; Buyout; Venture Capital (search for similar items in EconPapers)
JEL-codes: G23 G24 O16 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2026-04, Revised 2026-04
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