Advanced Search
MyIDEAS: Login to save this paper or follow this series

Financing Technology-Based Small Firms in Europe: a review of the empirical evidence

Contents:

Author Info

  • Valérie Revest
  • Sandro Sapio

Abstract

This paper reviews the empirical evidence of the financial sources used by technology-based small firms (TBSFs) in Europe. We shed light on cross-country differences and similarities in the capital structures of TBSFs, in the organization and dynamics of the venture capital industries and high-tech stock markets, as well as in policy-making. We focus on the main European economies, i.e. France, Germany, Italy and the UK. The evidence of a pecking order among capital sources, the rather conservative investment behaviors of venture capital funds in all countries, and the differential performances of hi-tech stock markets cannot be accounted for by the market-based vs. bank-based taxonomy widely used in the research on financial systems.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.lem.sssup.it/WPLem/files/2008-23.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2008/23.

as in new window
Length:
Date of creation: 07 Nov 2008
Date of revision:
Handle: RePEc:ssa:lemwps:2008/23

Contact details of provider:
Postal: Piazza dei Martiri della Liberta, 33, 56127 Pisa
Phone: +39-50-883343
Fax: +39-50-883344
Email:
Web page: http://www.lem.sssup.it/
More information through EDIRC

Related research

Keywords: Technology-based small firms; capital structure; venture capital; high-tech stock markets; public support.;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Gordon Murray, 1999. "Early-stage venture capital funds, scale economies and public support," Venture Capital, Taylor & Francis Journals, vol. 1(4), pages 351-384, October.
  2. Demirguc-Kunt, Ash & Levine, Ross, 1996. "Stock Markets, Corporate Finance, and Economic Growth: An Overview," World Bank Economic Review, World Bank Group, vol. 10(2), pages 223-39, May.
  3. Franklin Allen & Douglas Gale, 2001. "Comparative Financial Systems: A Survey," Center for Financial Institutions Working Papers 01-15, Wharton School Center for Financial Institutions, University of Pennsylvania.
  4. Carlin, Wendy & Mayer, Colin, 1999. "Finance, Investment and Growth," CEPR Discussion Papers 2233, C.E.P.R. Discussion Papers.
  5. Mayer, Colin, 2002. "Financing the New Economy: financial institutions and corporate governance," Information Economics and Policy, Elsevier, vol. 14(2), pages 311-326, June.
  6. Guiso, Luigi, 1998. "High-tech firms and credit rationing," Journal of Economic Behavior & Organization, Elsevier, vol. 35(1), pages 39-59, March.
  7. Wilson, David & Souitaris, Vangelis, 2002. "Do Germany's federal and land governments (still) co-ordinate their innovation policies?," Research Policy, Elsevier, vol. 31(7), pages 1123-1140, September.
  8. Andrew Ellul & Marco Pagano, 2006. "IPO Underpricing and After-Market Liquidity," Review of Financial Studies, Society for Financial Studies, vol. 19(2), pages 381-421.
  9. Vos, Ed & Yeh, Andy Jia-Yuh & Carter, Sara & Tagg, Stephen, 2007. "The happy story of small business financing," Journal of Banking & Finance, Elsevier, vol. 31(9), pages 2648-2672, September.
  10. Ljungqvist, Alexander P., 1997. "Pricing initial public offerings: Further evidence from Germany," European Economic Review, Elsevier, vol. 41(7), pages 1309-1320, July.
  11. Giovanni Dosi & Patrick Llerena & Mauro Sylos Labini, 2005. "Science-Technology-Industry Links and the ”European Paradox”: Some Notes on the Dynamics of Scientific and Technological Research in Europe," LEM Papers Series 2005/02, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  12. Engel, Dirk, 2002. "The Impact of Venture Capital on Firm Growth: An Empirical Investigation," ZEW Discussion Papers 02-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  13. Rajan, Raghuram & Servaes, Henri, 1997. " Analyst Following of Initial Public Offerings," Journal of Finance, American Finance Association, vol. 52(2), pages 507-29, June.
  14. Massimo Colombo & Luca Grilli, 2007. "Funding Gaps? Access To Bank Loans By High-Tech Start-Ups," Small Business Economics, Springer, vol. 29(1), pages 25-46, June.
  15. Laura Bottazzi & Marco da Rin, 2003. "Financing Entrepreneurial Firms in Europe: Facts, Issues, and Research Agenda," CESifo Working Paper Series 958, CESifo Group Munich.
  16. Aydin Ozkan, 2001. "Determinants of Capital Structure and Adjustment to Long Run Target: Evidence From UK Company Panel Data," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 28(1-2), pages 175-198.
  17. Leleux, Benoit & Surlemont, Bernard, 2003. "Public versus private venture capital: seeding or crowding out? A pan-European analysis," Journal of Business Venturing, Elsevier, vol. 18(1), pages 81-104, January.
  18. Charles P. Himmelberg & Bruce C. Petersen, 1991. "R&D and internal finance: a panel study of small firms in high-tech industries," Working Paper Series, Macroeconomic Issues 91-25, Federal Reserve Bank of Chicago.
  19. Atanasova, Christina V. & Wilson, Nicholas, 2004. "Disequilibrium in the UK corporate loan market," Journal of Banking & Finance, Elsevier, vol. 28(3), pages 595-614, March.
  20. Abimbola Adedeji, 1998. "Does the Pecking Order Hypothesis Explain the Dividend Payout Ratios of Firms in the UK?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 25(9-10), pages 1127-1155.
  21. E. Santarelli & M. Vivarelli, 2000. "Is Subsidizing Entry An Optimal Policy?," Working Papers 378, Dipartimento Scienze Economiche, Universita' di Bologna.
  22. Salim Chahine & Igor Filatotchev & Mike Wright, 2007. "Venture Capitalists, Business Angels, and Performance of Entrepreneurial IPOs in the UK and France," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 34(3-4), pages 505-528.
  23. Rahim Bah & Pascal Dumontier, 2001. "R&D Intensity and Corporate Financial Policy: Some International Evidence," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 28(5-6), pages 671-692.
  24. James Faulconbridge & Ewald Engelen & Michael Hoyler & Jonathan Beaverstock, 2007. "Analysing the Changing Landscape of European Financial Centres: The Role of Financial Products and the Case of Amsterdam," Growth and Change, Gatton College of Business and Economics, University of Kentucky, vol. 38(2), pages 279-303.
  25. Jeng, Leslie A. & Wells, Philippe C., 2000. "The determinants of venture capital funding: evidence across countries," Journal of Corporate Finance, Elsevier, vol. 6(3), pages 241-289, September.
  26. Tantazzi Angelo, 2001. "Il sistema bancario e la Borsa nello sviluppo italiano," L'industria, Società editrice il Mulino, issue 4, pages 715-726.
  27. Vitols, Sigurt, 2004. "Changes in Germany's bank-based financial system: A varieties of capitalism perspective," Discussion Papers, Research Unit: Institutions, States, Markets SP II 2004-03, Social Science Research Center Berlin (WZB).
  28. Ostgaard, Tone A. & Birley, Sue, 1996. "New venture growth and personal networks," Journal of Business Research, Elsevier, vol. 36(1), pages 37-50, May.
  29. Bascha, Andreas & Walz, Uwe, 2002. "Financing practices in the German venture capital industry: An empirical assessment," CFS Working Paper Series 2002/08, Center for Financial Studies (CFS).
  30. Rajan, Raghuram G & Zingales, Luigi, 2003. "Banks and Markets: the Changing Character of European Finance," CEPR Discussion Papers 3865, C.E.P.R. Discussion Papers.
  31. Günseli Baygan, 2003. "Venture Capital Policy Review: Norway," OECD Science, Technology and Industry Working Papers 2003/17, OECD Publishing.
  32. Booth, James R. & Smith, Richard II, 1986. "Capital raising, underwriting and the certification hypothesis," Journal of Financial Economics, Elsevier, vol. 15(1-2), pages 261-281.
  33. A. W. Coats, 1996. "Introduction," History of Political Economy, Duke University Press, vol. 28(5), pages 3-11, Supplemen.
  34. Dosi, Giovanni, 1990. "Finance, innovation and industrial change," Journal of Economic Behavior & Organization, Elsevier, vol. 13(3), pages 299-319, June.
  35. Jerry Coakley & Leon Hadass & Andrew Wood, 2007. "Post-IPO Operating Performance, Venture Capital and the Bubble Years," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 34(9-10), pages 1423-1446.
  36. Breschi, Stefano & Malerba, Franco & Orsenigo, Luigi, 2000. "Technological Regimes and Schumpeterian Patterns of Innovation," Economic Journal, Royal Economic Society, vol. 110(463), pages 388-410, April.
  37. Antonelli, Cristiano & Teubal, Morris, 2008. "Knowledge-intensive property rights and the evolution of venture capitalism," Journal of Institutional Economics, Cambridge University Press, vol. 4(02), pages 163-182, August.
  38. Josh Lerner, 2002. "When Bureaucrats Meet Entrepreneurs: The Design of Effective "Public Venture Capital" Programmes," Economic Journal, Royal Economic Society, vol. 112(477), pages F73-F84, February.
  39. Christian Pierdzioch & Andrea Schertler, 2007. "Sources of Predictability of European Stock Markets for High-technology Firms," The European Journal of Finance, Taylor & Francis Journals, vol. 13(1), pages 1-27.
  40. Chahine, Salim, 2004. "Long-run abnormal return after IPOs and optimistic analysts' forecasts," International Review of Financial Analysis, Elsevier, vol. 13(1), pages 83-103.
  41. Giudici, Giancarlo & Paleari, Stefano, 2000. " The Provision of Finance to Innovation: A Survey Conducted among Italian Technology-Based Small Firms," Small Business Economics, Springer, vol. 14(1), pages 37-53, February.
  42. Levine, Ross, 1996. "Financial development and economic growth : views and agenda," Policy Research Working Paper Series 1678, The World Bank.
  43. Judith Jordan & Julian Lowe & Peter Taylor, 1998. "Strategy and Financial Policy in UK Small Firms," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 25(1&2), pages 1-27.
  44. Mayer, Colin & Schoors, Koen & Yafeh, Yishay, 2005. "Sources of funds and investment activities of venture capital funds: evidence from Germany, Israel, Japan and the United Kingdom," Journal of Corporate Finance, Elsevier, vol. 11(3), pages 586-608, June.
  45. Cristiano Antonelli, 2008. "The new economics of the university: a knowledge governance approach," The Journal of Technology Transfer, Springer, vol. 33(1), pages 1-22, February.
  46. Jay R. Ritter, 2003. "Differences between European and American IPO Markets," European Financial Management, European Financial Management Association, vol. 9(4), pages 421-434.
  47. David B. Audretsch & Erik E. Lehmann, 2004. "Financing High-Tech Growth: The Role Of Banks And Venture Capitalists," Schmalenbach Business Review (sbr), LMU Munich School of Management, vol. 56(4), pages 340–357, October.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Valerio Vacca, 2013. "Financing innovation in Italy: an analysis of venture capital and private equity investments," Questioni di Economia e Finanza (Occasional Papers) 209, Bank of Italy, Economic Research and International Relations Area.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ssa:lemwps:2008/23. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.