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How attractive is central Eastern Europe for risk capital investors?

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  • Groh, Alexander Peter
  • von Liechtenstein, Heinrich
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    Abstract

    This paper addresses the attractiveness of Central Eastern European countries for risk capital investors by the construction of a tailored composite measure. Based on a survey among institutional investors, we define six key drivers that determine an emerging country's attractiveness for this type of investment. Using 42 socio-economic data series as proxies for these six key drivers, we benchmark the Central Eastern European countries with EU-15, Norway, and Switzerland and identify six tier groups of country attractiveness. We highlight socio-economic strengths and weaknesses of Central Eastern Europe and provide guidelines for policy improvements to attract more risk capital funding to spur innovation, entrepreneurship, employment, competitiveness and growth in the emerging region.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of International Money and Finance.

    Volume (Year): 28 (2009)
    Issue (Month): 4 (June)
    Pages: 625-647

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    Handle: RePEc:eee:jimfin:v:28:y:2009:i:4:p:625-647

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    Web page: http://www.elsevier.com/locate/inca/30443

    Related research

    Keywords: Central Eastern Europe Economic transition Emerging markets Venture Capital Private Equity;

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    Cited by:
    1. Suma Athreye & Georgios Batsakis & Satwinder Singh, 2013. "Subsidiary Embeddedness is a Strategic Choice: Complementarity and the factors associated with different types of embeddedness," DRUID Working Papers 13-05, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    2. Schertler, Andrea & Tykvová, Tereza, 2011. "Venture capital and internationalization," International Business Review, Elsevier, vol. 20(4), pages 423-439, August.
    3. Judit Karsai, 2012. "Development of the Hungarian Venture Capital and Private Equity Industry over the Past Two Decades," IEHAS Discussion Papers 1201, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
    4. Schertler, Andrea & Tykvová, Tereza, 2010. "What lures cross-border venture capital inflows?," ZEW Discussion Papers 10-001, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    5. Bubák, Vít & Kocenda, Evzen & Zikes, Filip, 2011. "Volatility transmission in emerging European foreign exchange markets," Journal of Banking & Finance, Elsevier, vol. 35(11), pages 2829-2841, November.
    6. Groh, Alexander Peter & von Liechtenstein, Heinrich & Lieser, Karsten, 2010. "The European Venture Capital and Private Equity country attractiveness indices," Journal of Corporate Finance, Elsevier, vol. 16(2), pages 205-224, April.

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