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Institutions and Venture Capital

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  • Lerner, Josh

    (Harvard Business School)

  • Tåg, Joacim

    ()
    (Research Institute of Industrial Economics (IFN))

Abstract

We survey the literature on venture capital and institutions and present a case study comparing the development of the venture capital market in the US to Sweden. Our literature survey underscores that the legal environment, financial market development, the tax system, labor market regulations, and public spending on research and development correlates with venture capital activities across countries. Our case study suggests these institutional differences led to the later development of an active venture capital market in Sweden compared to the US. In particular, a later development of financial markets and a heavier tax burden for entrepreneurs have played a key role.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 897.

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Length: 35 pages
Date of creation: 03 Jan 2012
Date of revision:
Publication status: Published as Lerner, Josh and Joacim Tåg, 'Institutions and Venture Capital' in Industrial and Corporate Change, 2013, pages 153-182.
Handle: RePEc:hhs:iuiwop:0897

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Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Phone: +46 8 665 4500
Fax: +46 8 665 4599
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Web page: http://www.ifn.se/
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Keywords: Financial market development; Institutions; IPOs; Labor markets; Legal environment; R&D; Taxation; Stock markets; Venture capital;

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