Direct and indirect effects of private- and government-sponsored venture capital

Erik Engberg, Patrik Gustavsson Tingvall and Daniel Halvarsson ()
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Erik Engberg: The Swedish Agency for Growth Policy Analysis
Patrik Gustavsson Tingvall: The Swedish Agency for Growth Policy Analysis
Daniel Halvarsson: The Ratio Institute

Empirical Economics, 2021, vol. 60, issue 2, No 7, 735 pages

Abstract: Abstract Starting from the discourse on the impact of private and governmental venture capital investments, we examine the effects of different types of venture capital on firms’ sales, employment and investment. Our results show that both private and governmental venture capital investments boost firm sales with a delay of 2–3 years. The results suggest that VC impacts sales primarily through efficiency gains and to some extent, investments in physical capital investments, whereas no employment effects can be traced. Finally, we find indications of governmental VC investors being more prone to make follow-up investments in stagnating, non-growing firms than private investors.

Keywords: Venture capital; Start-ups; Firm growth; Investments; Governmental venture capital (search for similar items in EconPapers)
JEL-codes: C21 C23 D22 G24 G28 H44 L25 L26 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s00181-019-01770-w

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