Does Competition Kill Ties?

Richard Lai ()

Others from University Library of Munich, Germany

Abstract: Venture capital firms (VCs) form syndicates that compete to invest in deals. Does more competition makes it less likely that VCs will choose syndicate partners based on past ties? Using over 200,000 observations on how VCs choose each other in 572 biotech deals in Massachussetts from 1967 through 2004, I find the answer is: yes. The theory of embeddedness argues that past ties can explain the pattern of who works with who. I interpret my finding as a first step in demarcating when embeddedness might apply and when atomistic, calculative, economic forces might be a better explanation of who works with who.

Keywords: economics of sociology; embeddedness; venture capital; ties; competition (search for similar items in EconPapers)
JEL-codes: G24 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2005-09-04
Note: Type of Document - pdf; pages: 30
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/othr/papers/0509/0509001.pdf (application/pdf)

Related works:
Working Paper: Does Competition Kill Ties? (2005)
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:wpa:wuwpot:0509001

Access Statistics for this paper

More papers in Others from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).