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Private equity: spice for European economies




Private equity has become a substantial force in the European financial system. This paper describes some of the recent developments and looks at the structural relationship between private equity investments and economic growth. The econometric analysis of a set of panel data from 20 European countries for the period between 1994 and 2004 fails to reject the hypothesis that private equity investments are associated with economic growth. According to this analysis, an ncrease in private equity investments of 0.1% of GDP is associated with an increase in real economic growth of between 0.2 pp (buyouts)and 0.8 pp (early-stage investments) — other things being equal.

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  • Meyer, Thomas, 2006. "Private equity: spice for European economies," Journal of Financial Transformation, Capco Institute, vol. 18, pages 61-69.
  • Handle: RePEc:ris:jofitr:0840

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    References listed on IDEAS

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    More about this item


    Private equity; venture capital; financial markets; growth;

    JEL classification:

    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage


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