Emergent Properties of a New Financial Market: American Venture Capital Syndication, 1960-2005

Bruce Kogut (), Pietro Urso () and Gordon Walker ()
Additional contact information
Bruce Kogut: INSEAD, Boulevard de Constance, Fontainebleau 77305, France
Pietro Urso: INSEAD, Boulevard de Constance, Fontainebleau 77305, France
Gordon Walker: Cox School of Business, Southern Methodist University, Dallas, Texas 75275

Management Science, 2007, vol. 53, issue 7, 1181-1198

Abstract: The recorded transactions of venture capital investments permit a direct examination of the Braudel hypothesis that regional markets evolve dynamically and interdependently in reference to a global system. This hypothesis contradicts the popular belief that regional financial development is anchored in dense clusters. Using methods of complex graphs, we analyze 159,561 transactions over nearly 45 years to demonstrate the rapid emergence of a national network of syndications. A giant component emerges early in the history of the industry, which subsumes the regional and sectoral subgraphs. The results confirm the Braudel hypothesis over the role of regional clusters, rejects preferential attachment in favor of repeated ties among trusted partners, and emphasizes the importance of dynamics and complex weighted graphs for the analysis of social and economic behavior.

Keywords: venture capital syndication; complex weighted graphs; giant components; financial market integration; network graphs (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.1060.0620 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:53:y:2007:i:7:p:1181-1198

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().