Fencing off Silicon Valley: Cross-Border Venture Capital and Technology Spillovers

Ufuk Akcigit, Sina T. Ates, Josh Lerner, Richard R. Townsend and Yulia Zhestkova

No 27828, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The treatment of foreign investors is a contentious topic in U.S. entrepreneurship policy. We model a setting where foreign corporate investments in Silicon Valley may allow U.S. entrepreneurs to pursue technologies that they could not otherwise, but may also lead to knowledge spillovers. We show that despite the benefits from such inbound investments for U.S. firms, it may be optimal for the U.S. government to raise their costs to deter these investments. Using as comprehensive as possible a sample of investments by foreign corporate investors in U.S. startups, we find evidence consistent with the presence of knowledge spillovers to foreign investors.

JEL-codes: G24 O33 O34 (search for similar items in EconPapers)
Date: 2020-09
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino and nep-sbm
Note: CF EFG PR
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Citations: View citations in EconPapers (3)

Published as Ufuk Akcigit & Sina T. Ates & Josh Lerner & Richard R. Townsend & Yulia Zhestkova, 2023. "Fencing off Silicon Valley: Cross-border venture capital and technology spillovers," Journal of Monetary Economics, .

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Journal Article: Fencing off Silicon Valley: Cross-border venture capital and technology spillovers (2024)
Working Paper: Fencing Off Silicon Valley: Cross-Border Venture Capital and Technology Spillovers (2020)
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