The Silicon Valley Syndrome

Doris Kwon and Olav Sorenson

Entrepreneurship Theory and Practice, 2023, vol. 47, issue 2, 344-368

Abstract: How does expansion in the high-tech sector influence the broader economy of a region? We demonstrate that an infusion of venture capital in a region leads to: (i) declines in the number of establishments and in employment in non–high-tech industries in the tradable sector; (ii) increases in entry and in employment in the non-tradable sector; and (iii) a rise in income inequality in the non-tradable sector. Expansion in the high-tech sector therefore leads to a less diverse tradable sector and to increasing inequality in the region.

Keywords: geography; entrepreneurial finance; inequality; research methods; venture capital (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Working Paper: The Silicon Valley Syndrome (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:entthe:v:47:y:2023:i:2:p:344-368

DOI: 10.1177/10422587211050892

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