Credit, venture capital and regional economic growth

Barbara Pistoresi () and Valeria Venturelli ()

Journal of Economics and Finance, 2015, vol. 39, issue 4, 742-761

Abstract: In this paper we investigate the role of credit and venture capital investments on regional economic growth. In particular, the paper investigates the nexus between finance and regional economic growth by means of an international comparison, making joint use of banking system structural indicators (i.e. the predominance of mutual bank circuits or large commercial banks) and risk capital values obtained in a local context. The dataset consists of a panel of 53 regions belonging to three countries, Germany, Italy and Spain, for the period 1995–2008. To avoid a problem of endogeneity, we estimate a dynamic panel using the generalised method of moments (GMM). The results underline the important role played by different types of financial intermediaries in regional economic growth: both mutual and commercial banks have a strong positive effect on regional economic growth, but the role of mutual banks is greater in economically deprived areas [EDAs]. Finally, the positive effect of venture capital investments is also more effective in EDAs regions. Copyright Springer Science+Business Media New York 2015

Keywords: Regional economic growth; Mutual banks; Venture capital operators; Economically deprived areas; Dynamic panel techniques; C21; G21; G24; O43; O57 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s12197-013-9277-8

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