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Europe's Entry into the Venture Capital Business: Efficiency and Policy

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  • Michael Stolpe

Abstract

This paper provides new evidence on Europe's experience with venture capital in the 1990s. Individual countries' activity is not solely determined by country characteristics and a purely domestic history, but also by a common European experience: the interdependence of valuations in primary equity markets. Each country must seek to improve the efficiency of its venture capital sector independently. Specific policies should depend on initial conditions and on the evolution of micro-efficiency. Initial public offerings backed by venture capital provide the appropriate window to look at the relative efficiency of individual venture capital organizations and their learning process over time. This paper is part of the international research programme on European Integration, Financial Systems and Corporate Performance (EIFC) carried out within the European Commission's specific programme "Improving the Human Research Potential and the Socio-Economic Knowledge Base". A first draft was discussed at the final EIFC programme workshop held on February 23, 2004, at the Kiel Institute for World Economics. Helpful comments from Douglas J. Cumming and other workshop participants as well as financial support from the European Union, DG Research (Contract No. HPSE—CT—1999—00039), are gratefully acknowledged. The project homepage is maintained by Anthony Bartzokas at www.intech.unu.edu/whoswho/index.htm.

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1223.

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Length: 78 pages
Date of creation: Aug 2004
Date of revision:
Handle: RePEc:kie:kieliw:1223

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Keywords: Venture capital; New techno­logy-based firms; Initial public offe­rings; Underpricing; Social multiplier;

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References

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Cited by:
  1. Michael Stolpe, 2004. "Non-Market Interaction in Primary Equity Markets: Evidence from France and Germany," Kiel Working Papers 1211, Kiel Institute for the World Economy.

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