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The Spatial Dispersion of Informal Investment at a Regional Level: Evidence from the UK

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  • Dylan Jones-Evans
  • Piers Thompson

Abstract

Although there have been various studies on the geographical specialization of venture capital in the UK, there remains a gap in the research on regional differences in the behaviour of those informal investors who make a significant contribution to the funding of entrepreneurial ventures. Utilizing a unique data set from the Global Entrepreneurship Monitor project, this study will estimate the level of informal investment activity across the different regions of the UK. The relationship between informal investment and early stage formal venture capital availability is also examined to determine which areas display the greatest funding gaps in the provision of equity finance. It shows that while formal and informal investments are heavily concentrated in highly prosperous areas such as London and the South East of England, informal investments make a larger relative contribution to early stage and expansion equity capital within poorer regions.

Suggested Citation

  • Dylan Jones-Evans & Piers Thompson, 2008. "The Spatial Dispersion of Informal Investment at a Regional Level: Evidence from the UK," European Planning Studies, Taylor & Francis Journals, vol. 17(5), pages 659-675, May.
    • Handle: RePEc:taf:eurpls:v:17:y:2008:i:5:p:659-675
    DOI: 10.1080/09654310902782138
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    References listed on IDEAS

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    1. Michael Fritsch & Dirk Schilder, 2006. "Is Venture Capital a regional business? – The role of syndication," Papers on Entrepreneurship, Growth and Public Policy 2006-25, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
    2. Michael Fritsch & Dirk Schilder, 2008. "Does Venture Capital Investment Really Require Spatial Proximity? An Empirical Investigation," Environment and Planning A, , vol. 40(9), pages 2114-2131, September.
    3. Colin Mayer, 2001. "Institutional Investment and Private Equity in the UK," Economics Series Working Papers 2001-FE-10, University of Oxford, Department of Economics.
    4. Colin Mayer, 2001. "Institutional Investment and Private Equity in the UK," OFRC Working Papers Series 2001fe10, Oxford Financial Research Centre.
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    Cited by:

    1. Iman Seoudi, 2015. "Public Policy For Venture Capital: An Integrated Framework," Global Journal of Business Research, The Institute for Business and Finance Research, vol. 9(4), pages 31-51.
    2. Frank Lasch & Frank Robert & Frédéric Roy, 2013. "Regional determinants of ICT new firm formation," Small Business Economics, Springer, vol. 40(3), pages 671-686, April.
    3. Vanessa Diaz-Moriana & Colm O’Gorman, 2013. "Informal Investors and the Informal Venture Capital Market in Ireland," Journal of Asian Scientific Research, Asian Economic and Social Society, vol. 3(6), pages 630-643, June.
    4. Claudia Álvarez & David Urbano & José Amorós, 2014. "GEM research: achievements and challenges," Small Business Economics, Springer, vol. 42(3), pages 445-465, March.

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