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Strength of Market Forces and the Successful Emergence of Israel's Venture Capital Industry. Insights from a Policy-Led Case of Structural Change

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  • Gil Avnimelech
  • Morris Teubal

Abstract

Through a microeconomic analysis of companies in Israel?s Venture Capital (vc) industry this paper aims to contribute to the discussion of targeted policies directed to the emergence of new industries, particularly but not only Venture Capital and High Tech industries. It integrates a firm-level dimension to previous work on vc Emergence which was wholly conducted at the industry or meso-economic level. The central contribution of the paper is the notion of ?Class A Market Forces? which our analysis shows characterized vc companies and vc-related activity during pre- and ?early? Venture Capital emergence in Israel. The paper argues that this ?high quality? feature of ?early? market agents in the area was an important factor in the successful policy-led emergence of Israel?s vc industry. The theme is part of a wider agenda of analyzing two types of links and related co-evolutionary processes: those between Structural Change, particularly policy-led Structural Change, and Economic Growth; and in a more indirect fashion, between Economic Growth on the one hand and the successful implementation of high-impact targeted ?industry emergence? policies on the other.

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  • Gil Avnimelech & Morris Teubal, 2004. "Strength of Market Forces and the Successful Emergence of Israel's Venture Capital Industry. Insights from a Policy-Led Case of Structural Change," Revue économique, Presses de Sciences-Po, vol. 55(6), pages 1265-1300.
    • Handle: RePEc:cai:recosp:reco_556_1265
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    References listed on IDEAS

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    Cited by:

    1. Schwartz Dafna & Bar-El Raphael & Malul Miki, 2008. "A Joint Virtual Advanced Technology Incubator - A New Pattern of Israeli-Palestinian Economic Cooperation," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 14(2), pages 1-19, July.
    2. Dafna Schwartz & Raphael Bar-El, 2006. "Venture Investments in Israel - A Regional Perspective Dafna Schwartz and Raphael Bar-El Ben-Gurion University, School of Management, Israel," ERSA conference papers ersa06p868, European Regional Science Association.
    3. Ilanit Gavious & Dafna Schwartz, 2009. "The Valuation Implications of Sales Growth in Start-up Ventures," Journal of Entrepreneurial Finance, Pepperdine University, Graziadio School of Business and Management, vol. 13(2), pages 1-24, Fall.
    4. Miki Malul & Raphael Bar-El & Dafna Schwartz, 2010. "Patterns of Cooperation in High-Tech—Constraints, Feasibility, and Benefits: Results of a Study among Palestinians and Israelis," Conflict Management and Peace Science, Peace Science Society (International), vol. 27(1), pages 67-84, February.
    5. Avnimelech, Gil & Teubal, Morris, 2006. "Creating venture capital industries that co-evolve with high tech: Insights from an extended industry life cycle perspective of the Israeli experience," Research Policy, Elsevier, vol. 35(10), pages 1477-1498, December.
    6. Gabriela Dutrénit & Martín Puchet Anyul & Luis Sanz-Menendez & Morris Teubal & Alexandre O. Vera-Cruz, 2008. "A policy model to foster coevolutionary processes of science, technology and innovation: the Mexican case," Globelics Working Paper Series 2008-03, Globelics - Global Network for Economics of Learning, Innovation, and Competence Building Systems, Aalborg University, Department of Business and Management.
    7. Breznitz, Dan & Zehavi, Amos, 2010. "The limits of capital: Transcending the public financer-private producer split in industrial R&D," Research Policy, Elsevier, vol. 39(2), pages 301-312, March.
    8. Mai, Nhat Chi, 2011. "Building a VC Market in Vietnam: VC Policy Lessons from Europe and Asia," OSF Preprints 968ye, Center for Open Science.

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