Höheres Beschäftigungswachstum durch Venture Capital? / Does Venture Capital Affect New Firms' Growth?
The paper deals with the analysis of causal effects of venture capital finance for new firms' growth. The crucial criterion for venture capitalists to invest in young firms is the expectation of growth of those investments. Hence, selection biases between the group of venture-backed firms and non-venture-backed firms are evident. Most of recent studies take only a small amount of firm-specific characteristics into account to consider potential biases between both groups of firms. Therefore, the estimation of the causal effect of venture capital finance for new firm growth is potentially biased. Within a statistical matching procedure an adequate control group for comparison with the group of venture-backed firms is drawn. Matching procedure is successful, because the group of venture-backed firms does not differ from the control group regarding a large amount of firm-specific, founder-specific and firm-location characteristics. The estimation of causal effects shows significant higher average annual employment growth rates of German venture-backed firms. However, differences between industries on the one hand and regions on the other hand are observed.
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Volume (Year): 223 (2003)
Issue (Month): 1 (February)
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References listed on IDEAS
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- Bürgel, Oliver & Fier, Andreas & Licht, Georg & Murray, Gordon, 2000. "Internationalisation of high-tech start-ups and fast growth-evidence for UK and Germany," ZEW Discussion Papers 00-35, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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- James J. Heckman & Hidehiko Ichimura & Petra Todd, 1998. "Matching As An Econometric Evaluation Estimator," Review of Economic Studies, Oxford University Press, vol. 65(2), pages 261-294.
- Sapienza, Harry J., 1992. "When do venture capitalists add value?," Journal of Business Venturing, Elsevier, vol. 7(1), pages 9-27, January.
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- Almus, Matthias & Engel, Dirk & Prantl, Susanne, 2000. "The Mannheim Foundation Panels of the Centre for European Economic Research (ZEW)," ZEW Dokumentationen 00-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Amit, Raphael & Brander, James & Zott, Christoph, 1998. "Why do venture capital firms exist? theory and canadian evidence," Journal of Business Venturing, Elsevier, vol. 13(6), pages 441-466, November.
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